Mega projects propel foreign fund release | 2018-07-01 |

Mega projects propel foreign fund release

Hasibul Aman     1st July, 2018 12:30:34 printer

Mega projects propel foreign fund release

Release of loan and grants from development partners marked a sharp rise in the first 11 months of the current fiscal year after the implementation of some mega projects gathered pace.


Total foreign fund disbursement during the July-May period of FY 2017-18 was $4.69 billion, which is $1,963 million or 72 percent higher than the same period last fiscal year, according to Economic Relations Division (ERD) data.   


During the same period a year earlier, release of grants and loans totaled $2,728.1 million. Total fund disbursement was $3.6 billion last fiscal. 


The released fund was 74 percent of the yearly fund release target of $6,311 million set by ERD for the current fiscal year.


ERD officials said though the achievement was slightly behind the target, it was the highest in the country’s history. However, they expected that fund release will improve further at the yearend.


“This year is the most productive in terms of foreign fund release because we’ve already got $4.6 billion fund disbursed against the target of $6 billion,” said ERD Secretary Kazi Shofiqul Azam.


It is very important for the country since project aid utilisation soared to nearly 72 percent out of the total ADP expenditure in 11 months compared to local resource segment’s 58 percent performance, he added.


He attributed this performance to intensified implementation of some mega projects. He informed that Padma rail link project is fetching $500 million from China, while Rooppur nuke power is getting $200 million to $250 million from Russia this fiscal year.


Fund commitments, on the other hand, more than doubled to $12.27 billion against ERD’s yearly target of $6 billion mainly thanks to some large fund commitments from JICA, World Bank, ADB and China.


Last year, total fund commitments soared to as high as $17 billion supported mainly by $11.38 billion loan for Rooppur nuke power plant, ERD secretary said.


He expected that total fund commitments may soar to $14.5 billion at the end of this fiscal year.


Of the released funds, $4,381.6 million is loan and $309.4 million is grants, while development partners released $2,398.4 million loans and $329.7 million grants in the same period a year earlier, suggest latest data released by ERD.


This year’s committed funds include $11,765.3 million loans and $506 million grants.


In the first 11 months in 2016-17FY, total fund commitments stood at $15,998.8 million including $15,635.3 million loans and $363.5 million grants.


Meanwhile, the government has managed to repay $1,315.3 million loans including $1,037.4 million as principal amount and $277.5 million as interests.


During July-May period this year, Japan released the highest amount of $1,328.2 million, while the World Bank released $1,075.3 million and Asian Development Bank (ADB) $772.1 million, ERD officials informed.


Economic analysts, however, suggested for enhancing implementing agencies’ capacity in utilizing the aid pipeline beyond mega projects to sustain the high fund disbursement trend.