IDB keen to invest $400m in country's telecom project
The Islamic Development Bank (IDB) has shown keen interest in investing in the country's telecom project worth US $ 400 million to increase tele-density by providing one million new land phones.
The interest shown by the IDB is welcome news for the Ministry of Post and Telecommunication as the government is in a dilemma to implement the project under the suppliers credit from China.
"The economic relation division informed the ministry about the interest shown by the IDB during the first week of the current month," said a high official of the ministry of post and telecommunications.
The official could not say how much money will be invested by the bank that is financing the country's submarine cable project through lending some $ 60 million.
But the official said implementation of the project -- the expansion of digital telephone exchanges in metropolitan areas, important district towns and upazila growth centres -- is necessary for Bangladesh which has the poorest tele-density in the world.
Country's present tele-density is about 0.4 telephone per 100 persons.
The expansion of digital telephone exchanges in metropolitan areas, important district towns and upazila growth centres had been aimed to eliminate the unserviced demand and increase the teledensity from 0.4 telephone to 1 telephone for every 100 persons by the current year.
But due to lack of money, the government has failed to implement the project.
In the meantime, China proposed to pump in $211 million into the project under which nearly half a million connections will be given in the first phase of the project.
The proposal from Beijing, which was forwarded by the Chinese Embassy in Dhaka in last September for the loan, categorised as hard-term loans, included a five per cent down payment and a repayment period of 20 years.
China also wanted its procuring entity in Bangladesh to go for the limited bid evaluation process, meaning that it would bypass the international competitive bidding.
But stringent loan conditions and the pressure from the multilateral lending agencies to avoid receiving suppliers' credit forced the government to refrain from signing the deal so far.
The government has an agreement with the IMF not to cross a certain ceiling about the use of foreign currency in a single year for the procurement of goods at non-concessional terms.
The IDB, an international financial institution, are working to foster the economic development and social progress of member countries and Muslim communities across the world since 1973.