B Mirror Desk: Bangladesh has received additional time from Russia, the lender to the country’s largest infrastructure project, the Rooppur Nuclear Power Plant. The project’s principal and interest payments were supposed to start from March 2027. The government had asked for two years due to various complications. Russia responded and gave it one and a half years.
Meanwhile, the Putin administration has waived the fine of more than $160 million that was imposed for not paying the installment of the $500 million loan taken for the feasibility study of the project on time. However, Bangladesh could not pay the installment properly due to US sanctions on Russia. Russia has given such a waiver in the revised protocol of the Rooppur loan.
To reduce the pressure of foreign liabilities, the interim government has requested the Russian government to set a time to start paying the debt of the Rooppur nuclear project from March 2029. The revised protocol has set a new time to start payments on September 15, 2028.
On Wednesday, Dr. Mohammad Mizanur Rahman said that such a good decision has been made based on the government’s communication with Russia. Since the project work is still pending, the process of extending the period by two more years is underway. Russia has agreed to it.
He said that before the start of the project, the loan installments taken for feasibility study are being deposited in a separate bank account. Due to US sanctions, it cannot be paid in dollars. Discussions are underway on alternative processes. However, no solution has been reached yet.
The total cost of the Rooppur Nuclear Power Plant is estimated at $12.65 billion or Tk 113,930 crore. Russia is providing a total loan of $11.38 billion as 90 percent of the cost. The remaining 10 percent is Bangladesh’s own resources. Bangladesh has received about $7.70 billion of the Russian loan so far. The loan disbursement was delayed due to the Corona pandemic and the subsequent Russia-Ukraine war. The remaining $36.8 million of the total loan promised by Russia is scheduled to be disbursed by December next year. Russia’s Rosatom State Atomic Energy Corporation is implementing the project.
ERD sources said that after the current interim government took office, some lending institutions and countries asked for more time to repay the loan. A discount on the loan interest rate was also sought. On February 26, Rosatom Director General Alexei Likhachev agreed to amend the loan agreement for the Rooppur project in a meeting with Chief Advisor Muhammad Yunus. The government and Rosatom agreed to finalize the amendment in that meeting.
The draft of the recently revised protocol sent from Moscow removed the condition of paying late fees for a one-month delay in loan repayment. The original protocol had a condition of paying a penalty of 4.5 percent if the loan repayment was delayed by one month. Accordingly, Bangladesh had to pay a penalty of $164 million for the outstanding installments of the feasibility study loan from March 15, 2022 to March 15, 2025. ERD officials said that Bangladesh is not responsible for the delay in loan repayment.
The construction of the country’s first nuclear power plant in Rooppur, Ishwardi Upazila of Pabna, is scheduled to be completed next December. Construction of the project began in 2017. The project is being implemented by the Ministry of Science and Technology.
