Debt burden won't rise much

Bangladesh's debt burden would not increase much even if the government borrowed $12 billion from Russia to build the Rooppur nuclear power plant, Finance Minister AMA Muhith said yesterday.  

“Still we will be able to borrow $14 billion more thanks to the economy's sustainability,” he told reporters at the secretariat.

The Economic Relations Division has carried out a debt sustainability study recently. It shows the debt burden would be $36 billion in 2024 from $24 billion now, if the current pace of borrowing growth continued.

Muhith said he had done his own calculations, and it could be $40 billion in 2024.

He made the comments after a meeting with NN Spassky, deputy director general of Rosatom State Nuclear Energy Corporation, and Alexander Ignatov, ambassador of Russia to Bangladesh.

Rosatom is helping Bangladesh set up the 2,400-megawatt nuclear power plant in Rooppur of Pabna at a cost of $12 billion. 

Muhith said the debt burden because of the loan from Russia would not increase as its terms and conditions were good, with 30 years as repayment period and several years as grace period.

The minister said the government was not concerned about the safety issue of the power plant as it would use the latest technology and put in place stringent safety measures.

“I have some reservations about the cost. Had we used the traditional sources, we could have produced this amount of electricity with $3.5 billion.”

He said the plant would use a new technology so the cost had gone up.

He said the lifespan of a traditional power plant was 30 years whereas the Rooppur nuclear power plant's lifespan was 90 years.

Muhith visited Russia from June 15-19. During his trip, he visited an old nuclear power plant where another unit is also being constructed. The cost for the new plant almost equals to that of the Rooppur plant, said Muhith.

“After seeing the plant, I am convinced that there will not be any pollution as many fear.”

During the meeting, Muhith also talked about the schedules of the plant.

The Russian delegation advised the government to extend the time for preparatory work by another year, to December 2017 from December this year.

The construction of the power plant will begin in January 2018. The first unit of the plant is expected to complete in 2024 and the second unit in 2025.