Sheikh Shahariar Zaman
Foreign loan repayment of Bangabandhu Bridge has increased by about 50 per cent due to revision of special drawings rights (SDR) price.
The installment amount was increased from June payment as the Bangladesh Bridge Authority (BBA) earlier fixed the SDR rate at over Tk 60 but now it has been revised to over Tk 100, an official of the BBA told the FE.
The BBA pays its three major lenders – JICA, World Bank and ADB – four installments a year.
“The government paid about Tk 260 million to each for the first three quarters of the last fiscal but in the fourth quarter the amount rose to over Tk 370 million due to revision of the SDR rate,” he said.
“We don’t have any conversion problem with Japanese credit as JICA loan is pegged with yen while the repayment of ADB and WB is pegged with SDR,” he explained.
Each of the multilateral lenders gave $200 million for the construction of the bridge.
The bridge was inaugurated in 1998 and in the first 10 years of grace period, the government only repaid interest and since 2007/08 it started to pay interest and principal, said another official of the BBA.
“The installment figure will be almost double from 2014 as per the lending agreement,” he said adding, “The government will have to repay all the foreign loans by 2034 and according to amortisation schedule, the repayment amount will be increased by about 80 per cent after four years.”
The authority earns Tk 2.0 to 2.2 billion each year from the bridge toll and a major portion of it goes to repayment of loans, the official said.
“The bridge authority has plan to float Tk 2 billion bonds through securitisation, but it may defer the floating as it doesn’t want to take any loan burden right now,” he said.
The bonds have a tenure of 10 years and bear interest rate at 11.5 per cent for individual investors and 8.5 per cent for institutional investors, he added.
The floatation proposal was placed before the BBA board in June and the board members agreed to defer the floatation date.
Finance minister in January disclosed that the BBA would raise Tk 2 billion capital from the market to fund Padma Bridge.