The Asian Infrastructure Investment Bank (AIIB) has approved a loan of $60 million to install a 220 MW combined cycle power plant in the country’s largest island-district Bhola.
According to the AIIB officials, the Chinese (Beijing) based Infrastructure Investment Bank has approved the loan in last week. The total project cost is $271 million. Islamic Development Bank and local Infrastructure Development Company Limited will be financing rest of the project cost.
The Bhola Independent Power Producer (IPP) greenfield power plant will be developed by ShapoorjiPallonji Infrastructure Capital company through NutanBidyut (Bangladesh), which is a special-purpose vehicle incorporated in Bangladesh for the sole purpose of developing the project.
“We’re investing in this project because it will be one of the most efficient power plants delivering low-cost power in Bangladesh,” said AIIB Director General, Dong ik Lee. “This investment will also help mobilize private capital and provide critical long-term financing that is not readily available in Bangladesh for vital infrastructure projects.”
According to the sources from AIIB, the construction of the Bhola IPP began in the last quarter of the last year. The combined cycle power plant is expected to be operational from December 2019. According to Dong ik Lee, it will be one of the most efficient power plants delivering low-cost electricity in Bangladesh.
According to AIIB sources, the $60 million loan for Bhola IPP will take AIIB’s total loan portfolio in Bangladesh to $285 million, which is 6.6 percent of the total AIIB investment portfolio.