Bangladesh seeks $610 mln for Padma bridge project

DHAKA (Reuters) – Bangladesh will raise about $610 million from the capital markets to build the country’s largest bridge over the Padma river at Mawa, 50 kilometres south of Dhaka, a senior official said on Monday.

The bridge will cost $2.4 billion, of which donors have so far committed $1.24 billion, including $460 million from the World Bank.

After twice revising costs for the multipurpose 6.15 km bridge, the government planned to raise funds by issuing shares and securitised, convertible, zero-coupon and amortised bonds, the official said.

The state managed Investment Corporation of Bangladesh (ICB) has prepared the proposal and submitted it to the finance ministry for final approval. “Now we are awaiting … approval from the finance ministry,” said Iftikhar-uz Zaman, a senior official of the ICB.

Asian Development Bank, Jeddah-based Islamic Development Bank, Japan International Cooperation Agency and Abu Dhabi Fund have also committed finance.

The bridge will connect the southwestern region directly with the capital and other parts of the country.

“The proposed bonds or shares will be traded in both Dhaka and Chittagong stock exchanges,” the official told reporters.

Those who will invest in the bonds may enjoy tax benefits.

Given the social benefits of the project, the government may consider a relaxation of VAT (value added tax) from income from the bridge.

(Reporting by Serajul Islam Quadir; Editing by David Holmes)

($1 = 69.06 taka)