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Yunus Govt Of Bangladesh Requests To China For Loan

  • By Thetripurapost Desk, Dhaka
  • Sep 14, 2024
  • 497

Just a month after Sheikh Hasina left the country, Bangladesh has now started pleading with China. 

The interim government of Bangladesh led by Mohammad Yunus has requested China to reduce the interest rate on the current loan to one percent. Along with this, it has requested to extend the loan repayment period to 30 years. 

Bangladeshi media outlet 'The Daily Star' has reported that the Economic Relations Division (ERD) of the Finance Ministry of Bangladesh sent a letter to Beijing in this regard earlier this week. 

Currently, the interest rate on Chinese loans is between 2-3 percent, which is to be repaid in 20 years.

On Wednesday this week, the chief advisor of the interim government Mohammad Yunus addressed the nation and mentioned the poor economic condition of the country. 

He said that Bangladesh's foreign exchange reserves are depleting rapidly. To reduce the pressure on this, Bangladesh is demanding lower interest rates and extended repayment for foreign loans.

Professor Yunus said Bangladesh has requested China to reduce interest rates on its loans and extend the repayment period. During his visit to Bangladesh in October 2016, Chinese President Xi Jinping promised $20 billion over the next four years to implement 27 projects. 

This is the largest amount committed by any country to Bangladesh. According to ERD data, till this January, Dhaka and Beijing had managed to reach agreement on only 9 projects, totalling $8.08 billion. Of this, Bangladesh has been able to use only $4.91 billion.

Mohammad Yunus said Bangladesh has also urged Russia to reduce interest rates and allow extended repayment. Yunus said the government was negotiating with Russia regarding advance payments for the Rooppur nuclear power plant and outstanding loans. Dhaka has taken a loan of $11.38 billion from Russia for the nuclear plant, which covers 90 percent of the project cost. 

Apart from this, Bangladesh has also taken an additional loan of $500 million for the primary work of the project