Okay, okay, we will make sure this loans serves your pocket also.
--- In alochona@yahoogroups.com, Isha Khan <bdmailer@...> wrote:
>
> Loan from Delhi raisesbillion dollar questions
>
> *M. Shahidul Islam*
>
> The $1 billion loan agreement signed with India on August 7 begets some
> billion dollar questions: Whose interest will it serve and whether the fund
> was at all needed. Cynicism has exacerbated by the loan coming at a time
> when it is least needed; over $500 million of ADB, IMF and other
> source-loans lying idle in the government's coffer.
> Decoding the mindset of policy makers in Dhaka and Delhi has become a
> futile exercise since the coming to power of the AL-led regime in early
> 2009. While any definitive answers to such questions will remain unanswered
> for obvious reasons, a glance at the targeted projects where the borrowed
> money will be spent may provide some valuable clues to unearthing the real
> motive behind this unprecedented economic collaboration between the two
> South Asian neighbours.
>
> *Whose interest?*
> Of the 14 projects for which the predominance of the borrowed $1 billion
> is slated for spending, over 76 per cent of the fund is earmarked for the
> (1) construction of Ashugonj port and dredging of navigation route leading
> to Tripura border, (2) upgrading of railway tracks and purchase of railway
> locomotives and oil tankers to transport Indian goods across the border, (3)
> construction of bridges astride Indo-Bangladesh border, including over the
> Bhairab and the Feni river connection Tripura, (4) construction of
> Ramgar-Subrom land port and the connecting roads, and, (5) construction of
> Bheramara-Bahrampur 400 KV inter- connected lines at a cost of $150 million,
> to name but a few.
> The agreement stipulates that the pipeline projects must incur 85 per
> cent of the costs by procuring goods and services from India only, and, the
> consultants hired for advising must be from India too. That alone will
> divert back 90 per cent of the fund to India. Add to this .50 per cent
> penalty for non-completion of any project, 1.75 per cent annual interest and
> .5 percent commitment fee per annum. The entire venture has little or no
> value added dividend for Bangladesh, excepting an estimated $25 million or
> so that is expected to come annually from custom fee and the allied levies
> that are yet to be decided.
>
> Simply put: Delhi will plan, fund and complete all these strategically
> important projects inside Bangladesh with materials from India, to serve
> India's interest, while the cost incurred is a loan to Bangladesh which the
> country may not be able to pay off within the stipulated 20 years time
> frame. Besides, the loan's conditionality is so stringent that the negation
> of any future government to comply with the projects' completion will not
> absolve the nation from paying the interests and the penalties during the 20
> years amortization period.
>
> As well, the 1.75 per cent interest is too high, compared with the loan
> transactions occurring at public and private levels anywhere in the world;
> due to the recession-battered prime landing rate being either zero, or at
> best one per cent in the leading economies of the world. More disturbing is
> the 20 years payment deadline, which covers only half of the payment
> time-line usually offered by major international financial institutions
> while the stipulated interest rate is seven times of what the IMF loan
> charges, .25 per cent at best.
>
> *Why policy- shift?*
> Despite that, our finance minister is on record for accusing the
> opposition BNP of lying, as the latter insisted on not to sign the loan
> accord in consideration of upholding national interest. The gala and the
> glittering of the signing ceremony had also dwarfed the potential of an
> economic and geopolitical disaster this particular loan is sure to bring
> upon our nation.
>
> The finance minister is not alone in touting the issue as an epoch -
> making economic bonanza. Prior to Dhaka consenting to inking the agreement,
> few in the nation took pain to study the economic and the arithmetical
> rationale for doing so, especially at a time when the decision to borrow
> from external sources marked a radical shift from existing policies which
> proved successful over the decades by reducing debt-dependency on external
> sources, often phenomenally.
>
> We also feel numb as none among the policy makers even bothered to ask,
> why Dhaka needed $1 billion credit from India when its debt-GDP ratio stood
> at all time high, over 32 per cent of the GDP, or well over $50 billion, of
> which public debt alone rose by over $2 billion since the coming to office
> of the AL-led regime in late 2008 (Source: CIA fact sheet). Bangladesh bank
> data also reveals, total government borrowing was Tk. 597.9 billion in FY
> 2007, out of which Tk. 522.0 billion (87 percent) came from domestic sources
> while the net flow of public borrowing from external sources remained nearly
> stagnant in FY06-07, and declined further subsequently.
>
> *Deadly geopolitics*
> Such compelling economic rationales aside, India's generosity remains
> questionable; the loan coming to Dhaka at a time when India itself is
> bleeding under a slew of catastrophic afflictions spurred by a lingering
> recession, accelerated centrifugal drives spearheaded by insurgents from
> Kashmir to Mizoram to Assam, and the widespread public discontent created by
> a combustive mix of mass unemployment and hyper inflation which Delhi seems
> totally unable to tackle.
> Some observers say, this is hardly a micro-managed regional bonhomie to
> bolster fraternity with a smaller neighbour in crisis. Faced with
> unprecedented domestic crisis, Delhi had to display some geopolitical
> acrobatics to deflect attention outward and the scheme fitted neatly with a
> Machiavellian design to turn Bangladesh into an economic and military
> hinterland that has been in the making since Delhi decided to join the
> US-led anti terror bandwagon in 2001.
> They say, ever since, Delhi has been on the driving seat in Dhaka while
> irritating silence and procrastination remained our national hallmark amidst
> the gradual but systematic enfeebling of the nation by (1) rendering the
> armed forces impotent, and, (2) bludgeoning the economy through orchestrated
> destruction of the main export sector, the RMG.
>
> This line of analysis jibes well with the desperation Delhi felt lately
> as it witnessed, helplessly, Nepal turning into a Maoist state, Sri Lanka
> drifting away toward China and the Pakistani success in checkmating Delhi in
> Afghanistan amidst successive Taliban victory in the battles against the
> India-allied NATO forces. They say as most of the earmarked projects involve
> land and marine connectivity between India's north east with the mainland
> via Bangladesh, our nation is being turned into a virtual India corridor.
> This constitutes serious compromises of our territorial integrity and
> sovereignty.
>
> http://www.weeklyholiday.net/front.html#02
>
------------------------------------
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