Xi's visit to take China-Bangladesh ties to new height

Raft of accords to be signed during the president's visit
The ensuing visit of the Chinese President Xi Jinping's to Dhaka has stirred huge media hype as country's leaders and business community said that the event would elevate ties between the two countries to a new height.
During his around 22-hour visit beginning on October 14, Jinping will meet top political leaders, ministers, businessmen and others and is likely to sign around a dozen of agreements, protocols and MoUs.
Ahead of Jinping's visit, the Cabinet on Monday approved a draft of the proposed bilateral agreement between Bangladesh and China chaired by Prime Minister Sheikh Hasina. The agreement on the productivity assistance development would be signed during the visit," Cabinet Secretary Shafiul Alam said.
Before disbursing any money from its exchequer, China wants to sign a bilateral agreement with Bangladesh, "Productivity Assistance Development Agreement between Bangladesh and China," for building capacity and credibility to handle Mega projects in proper manner.
However, a framework agreement was signed between the two nations as Bangladesh has been carrying out a hectic effort for getting over US$300 billion financial assistance from China.
"The agreement is aimed at developing capacity and productivity. As per the deal, we'll be able to transfer technology and develop our capacity," he added.
The signing of formal loan agreements on nearly two dozens of infrastructure projects that saw their major negotiations completed between Dhaka and Beijing on $13 billion Chinese investment will be on top of the talks from the Bangladesh side.
Besides, Bangladesh may seek support from China in addressing acts of militancy and violent extremism.
Officials concerned in the Finance Ministry said their highest priority would be to persuade the Chinese authorities to step up their efforts towards inking the almost negotiated draft deals at the forthcoming bilateral talks.
The Chinese leader will be accompanied by a large official delegation, including the external affairs minister, finance minister, commerce minister, shipping minister, transport minister and power minister to sign agreements on concern projects.
According to the Economic Relation Division (ERD) from 2002 to 2009, the Chinese government gave $200 million to Bangladesh and $900 million between 2009 and 2015.
"In 2014-15, following Prime Minister Sheikh Hasina's visit to China, it committed to give Bangladesh $23 billion in the next five years but there has not been any written response," senior official of ERD told the Daily Observer.
Earlier, Bangladesh sent lists of dozens of projects to the Chinese government for soft loan. The Chinese side also gave verbal commitment for assistance amounting to $10 billion to $30 billion.
"Everything is yet to be finalise, let we wait and see," the ERD official said.
According to the Finance Ministry Bangladesh is borrowing from China's Banks from last 6 to 7 years to implement projects.
"We want to discus about the interest rate this time, at 2 per cent interest rate with tenures up to 20 years, but these rates could not be compared to those of the World Bank and the Asian Development Bank as Chinese financing entails one problem as the biddings are unsolicited and do not go through a tender process," a Finance Ministry official said.
"This time we want usual tendering process as through this process we can negotiate hard for the rates, terms and conditions for a loan," he added. Bangladesh is getting ready to sign six mega projects involving $6.07 billion with China during the upcoming visit, according to sources in the Foreign Ministry and Economic Relations Division (ERD)
Sources said several agreements and memorandums of understanding, including inauguration of Karnaphuli tunnel project, installation of rail tracks on the Padma Bridge, construction of trade fair centre at Purbachal, garments village, investment park at Anwara and marine drive expressway from Sitakunda to Cox's Bazar will be signed during the visit.
The projects in which negotiations for commercial contracts are under process are expansion and strengthening of power system network under DPDC area project involving $2.35 billion, Padma Bridge rail link (phase-1) at a cost of $1.65 billion, Padma Bridge rail link (phase-2) at a cost of $917 million, power grid network strengthening project under PGCB costing $1.32 billion, construction of Dhaka-Ashulia elevated expressway at $1.39 billion, modernisation of telecommunications network for digital connectivity at $200 million and establishment of full-fledged five TV stations of Bangladesh television costing $127.88 million.
The projects include construction of a marine drive expressway and coastal protection from Sitakunda to Chittagong and Cox's Bazar ($2,856.56 million), conversion of the middle-gauge rail track into a dual-gauge one from Akhaura to Sylhet ($1,756.05 million), pre-payment meeting project for the Bangladesh Power Development Board's (BPDB) distribution zones ($521.56 million), expansion and modernisation of Mongla Port facilities ($249.17 million) and extension of the existing underground mining operations of Barapukuria coal mine to increase the production capacity of the mine ($256.41 million) are also in the list.
However, China wanted to invest about $350 million in various sectors of Bangladesh for product diversification, value addition as well as enhancement of exports for mutual benefits of the two countries.
According to the ERD sources, China has given an assurance to implement these six projects under limited tender. However, Bangladesh side is yet to give any decision in this regard, it is just examining the option whether the project would be implemented under limited tender or direct procurement method.
 "The signing of formal loan agreements on nearly two dozens of infrastructure projects that saw their major negotiations completed between Dhaka and Beijing on $13 billion Chinese investment will top the talks from Bangladesh's side," a senior official of ERD said.
Officials of the Finance Ministry said their highest priority would be to persuade the Chinese authorities to step up their efforts towards inking the almost negotiated draft deals at the forthcoming bilateral talks.
Finance officials have said currently four types of developments involving 19 projects are lying pending for a kick start. They are projects for which commercial contracts have been signed and loan applications sent to Chinese Eximbank, projects on which negotiations for commercial contract have been under process, projects for which recommendation letters have been given to Chinese companies and projects having no response as yet.
The projects having commercial contract signed and loan application sent to Eximbank are development of National ICT infra-network for Bangladesh government phase -3 (Info-Sarkar) involving $150 million, construction of tunnel under the River Karnaphuli at a cost of $705.50 million, surface water treatment plant in Rajshahi at $500 million and installation of single point mooring with double pipeline at $500 million.
The projects in which negotiations for commercial contracts are under process are expansion and strengthening of power system network under DPDC area project involving $2.35 billion, Padma Bridge rail link (phase-1) at a cost of $1.65 billion, Padma bridge rail link (phase-2) at a cost of $917 million, power grid network strengthening project under PGCB costing $1.32 billion, construction of Dhaka-Ashulia elevated expressway at $1.39 billion, modernisation of telecommunication network for digital connectivity at $200 million and establishment of full-fledged five TV stations of Bangladesh television costing $127.88 million. Recommendation letters given to a Chinese company for funding involve construction of inland container depot near Dhirasram Railway Station costing $200 million, replacement of overloaded distribution transformer for providing reliable electricity in rural electrification system at a cost of $280.59 million, water supply, sanitation, drainage and solid waste management for small sized municipalities costing $150 million, balancing modernisation rehabilitation and expansion of the public sector jute mills of Bangladesh jute mills corporation at a cost of $280 million, construction of a DG Track Parallel to the existing MG line in Joydebpur-Mymensingh section costing $258.36 million and construction of double line (dual gauge) between Joydebpur-Ishwardi section costing $752.79 million.
The project called 'establishing digital connectivity' at a cost of $1.0 billion got no response from the Chinese authorities, sources said.