India, Bangladesh to sign investment pacts worth $9 billion

12 agreements will include an MoU of $2 bn in investments in Bangladeshi power sector by Adani Power

Agreements and memoranda of understanding (MoUs) worth $9 billion of investments into Bangladesh will be signed between the Indian public and private sectors and the Bangladeshi side on Monday. The 12 agreements will include an MoU of $2 billion in investments in the Bangladeshi power sector by Adani Power, a subsidiary of the Adani Group.

Agreements on the anvil

• 12 MoUs worth $9 billion in investments in Bangladesh to be signed on Monday
• These include one MOU of $2 billion for investments in the Bangladesh power sector by Adani Power
• Agreements by Reliance Power and NTPC Vidyut Vyapar Nigam 
• Agreement between Container Corporation of India and Container Corporation of Bangladesh
• India committed a $4.5-billion line of credit for implementation of infrastructure projects in Bangladesh

Agreements will be signed for investments in Bangladesh by Reliance Power and NTPC Vidyut Vyapar Nigam. An agreement will also be inked between the Container Corporation of India and the Container Corporation of Bangladesh.

The agreements will be signed in the presence of Bangladesh Prime Minister Sheikh Hasina, currently on a four-day visit to India, at a Confederation of Indian Industry (CII) event here on Monday.

On Saturday, India committed to a $4.5-billion line of credit for implementation of infrastructure projects in Bangladesh, and another $500 million for Dhaka’s defence procurements. In all, the two sides signed 22 agreements across an array of sectors. By the end of the Bangladeshi PM’s visit, as many as 34 agreements would have been signed.

This is the third line of credit to Bangladesh in the past six years, and the largest. For this line of credit, Delhi and Dhaka have identified 17 infrastructure projects. These comprise upgradation of three ports, one airport, new power transmission lines and railway lines.

Foreign Secretary S Jaishankar said on Saturday the message was that “India has a very positive and effective infrastructure development assistance programme”. He said there was a lot of emphasis from the ministry of external affairs for faster delivery on projects.

In October 2016, Chinese President Xi Jinping had visited Dhaka and promised Chinese investments worth $20 billion. Nearly all of India’s neighbours complain of Delhi being laggardly, as compared to the Chinese, in executing its infrastructure projects.

Some of the bigger investments by Indian companies will be in the power and energy sectors. India supplies 600 Mw of power to Bangladesh through two existing interconnections at Bheramara-Baharampur and Tripura-South Comilla. Another 500 Mw will be provided by India through the Bheramara-Baharampur interconnection.

The two sides have agreed to set up additional interconnection between Bornagar in Assam and Parbatipur in Bangladesh, and also Katihar in Bihar, for power evacuation facilities from which Bangladesh can draw 1,000 Mw of power. The two sides are also discussing supply of 340 Mw from various NTPC stations. 

Prime Minister Narendra Modi said on Saturday he hoped more Indian private sector investments in Bangladesh’s power sector would follow, including possibilities of joint ventures.

On Sunday, Hasina visited Ajmer Sharif to pay her respects at the shrine of Khwaja Moinudding Chishti, a 12th century Sufi saint. She concludes her visit on Monday evening. Her party, the Awami League, said on Sunday they planned a felicitation for her successful visit to India.

Also, however, in Dhaka, Bangladesh’s opposition leader Khaleda Zia accused Hasina of “selling out” the country to India, to translate into reality a “dream of staying in power for life”. Zia, 71, and Hasina, 69, are known as the ‘Battling Begums’ for a bitter rivalry for over three decades.