Dhaka-Delhi to sign $2billion LOC deal Wednesday

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Dhaka and New Delhi will sign the final agreement on a $2 billion credit from India on Wednesday.

Additional Secretary Mohammad Asif-uz-Zaman of the Economic Relations Division (ERD) said the signing of the Line of Credit (LOC) deal will take place at the NEC Auditorium in Dhaka at 3pm.

The agreement will be signed by ERD Senior Secretary Mohammad Mejbahuddin of Bangladesh and the chairman and managing director of India’s Exim Bank.

Previously during Indian Prime Minister Narendra Modi’s Dhaka visit in June last year, a Memorandum of Understanding (MoU) was signed on the fresh ‘soft loan’.

About 65 to 75 percent of goods and services will be obtained from India.

A report on the final agreement has already been sent to the PM.

According to the report, the $ 2 billion credit carries 1 percent interest rate and 0.5 percent commitment fee. The repayment period will be 20 years with a grace period of five years.

Should Bangladesh fail to use the credit within the given time, an additional 2 percent penalty interest will have to be paid.

Source: Ittefaq

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