The government is looking forward to sign a $220 million credit assistance agreement with the Islamic Development Bank (IDB) by June for 400 MW Ashuganj (East) power plant efficiency improvement project in Bangladesh.
“Hopefully, we’ll be able to sign the credit agreement for the 400MW Ashuganj (East) power plant efficiency improvement project in the country by this June. It could be either signed in Dhaka or in Jeddah,” said an Economic Relations Division (ERD) official.
Following a recent inter-ministerial meeting, the official said, the draft credit deal with some proposed amendments to be sent to the IDB headquarters in Jeddah for their consent and the agreement will be signed then.
According to sources at the Power Division, the $220 million IDB assistance will help replace old steam and gas turbine power plants with a more efficient 400-MW gas-fired combined cycle power plant at Ashuganj Power Station complex.
It will also help upgrade and construct 72 kilometers of transmission lines, and four substations. The existing analog billing meters will be replaced by 700,000 prepaid meters in Dhaka division.
The 400-MW Ashuganj (East) power plant efficiency improvement project is a five-year term project (Jan 2016-Dec 2020) and the total cost of the project is estimated at $ 530 million.
Out of the amount, the ADB will provide $ 205 million from OCR, while $ 220 million will come from the IDB and $ 105 million from the national exchequer.
The Power Division is the executing agency and Ashuganj Power Station Company Ltd (APSCL), Power Grid Company of Bangladesh Ltd (PGCB) and Bangladesh Rural Electrification Board (BREB) are the implementing agencies of the projects under the programme.
The main objective of this programme is to enhance the capacity of power generation, transmission and distribution in Bangladesh.
Earlier on 16 February, the Board of Executive Directors of the Islamic Development Bank (IDB) approved the funding for the Ashuganj project.
The ERD official also said two other agreements were also signed with the Jeddah-based lending agency in April this year for sustainable housing for low-income urban communities and development of a technical teacher training institute.
The IDB will provide $ 20 million for sustainable housing for low-income urban communities and $ 8.3 million for a technical teacher training institute project in Bangladesh.
Under the sustainable housing for low-income urban communities project to be implemented by the Bangladesh Municipal Development Fund under the Ministry of LGRD, small flats will be constructed for the conservancy workers in Faridpur and Mymensingh municipalities while low-cost flats to be built in Gazipur targeting the RMG workers of that area.
The Bureau of Manpower, Employment and Training (BMET) will implement the technical teacher training institute project under the Ministry of Expatriates Welfare and Overseas Employment, aiming to build skilled manpower in line with the demand of national and international labour markets.
With the signing of the deals, according to the official, the government will be able to have this year’s target of receiving $ 250 million from the IDB fulfilled as the Jeddah-based lending agency had earlier committed.