Bangladesh looks to another development financier from the East -- New Development Bank (NDB) -- as the government is now scrutinising some priority projects for its fund support, officials say.
"We formally became member of the NDB in September last. Now the bank has recently offered us financial support for some development projects. We will request it for financing shortly," says a senior Economic Relations Division (ERD) official.
He says the NDB has assured funds for some 2-3 projects in the first year of launching of the financing to Bangladesh by the Shanghai-based lending agency. "So we are scrutinising the priority and better projects to be sent."
The maiden list of 2-3 projects will be sent shortly with the expectation for nearly US$1.0 billion within the next fiscal year (FY), 2022-23, the ERD official adds.
Established by BRICS countries in their latest stride on the economic front-with the neo-rich China at the head-the multilateral development partner, NDB, is going to be a new destination for Bangladesh's development financing.
So far, the World Bank, the Asian Development Bank, the Asian Infrastructure Investment Bank (AIIB) and the Islamic Development Bank are the key multilateral development partners for the country which is now on the trajectory of graduating out of the world's poor-country club, LDC.
Meanwhile, Bangladesh has already attained 2.0-per cent voting power at the NDB after joining as its sixth-shareholding member, officials said Thursday.
Bangladesh, getting the first membership after the five-core founding members, would pay $15 million in the first installment of its US$942 million worth of shares in the Shanghai-based lending agency early next year, the Ministry of Finance (MoF) officials said.
"Bangladesh has already paid $15 million in its first installment and qualified for obtaining loans from the multilateral lender against different projects and programmes," says one MoF official.
The BRICS (Brazil, Russia, India, China and South Africa) countries have established the NDB parallel to other older development financiers like the World Bank, the Asian Development Bank, the Islamic Development Bank and the African Development Bank.
In September last, Bangladesh finally attained 1.0-per cent shares in the up-and-coming lender as the country was offered one of three fortunate shareholders after the five founding BRICS nations.
The ERD officials said Bangladesh would have to pay a total of $188 million out of $942 million worth of shares in seven installments in as many years as it is the payable subscription.
The remaining $754 million worth of subscription will be treated as the "callable fee" which will not have to be paid at this moment, the officials said.
According to the MoF, currently Bangladesh would get 1.84-per cent voting right on the NDB board.
Bangladesh's finance minister is the governor and the ERD secretary alternative governor of the Shanghai-centric lender.
The board in September this year approved membership of three countries-Bangladesh, the United Arab Emirates and Uruguay. Bangladesh then negotiated with the lender for getting more than 1.0-per cent stake in the newly established BRICS nations' banking institution.
The NDB-founding members made an initial subscription for 500,000 shares totaling US$50 billion, which include 100,000 shares corresponding to a paid-in capital of US$10 billion and 400,000 shares corresponding to a callable capital of US$40 billion.
In 2016, Bangladesh joined the China-led Asian Infrastructure Investment Bank (AIIB).
The Beijing-based lender has been financing many projects in Bangladesh in several sectors, such as power, transportation, water supply and sanitation.
After the independence of Bangladesh in 1971, many multilateral and bilateral donors, including the World Bank, the Asian Development Bank, Japan, the Islamic Development Bank, UKAID, and USAID, have provided loans and grants for developing the country's infrastructure and reducing hunger.
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