Power Sector Debts Strain BD’s Foreign Loan Repayment Capacity

The government has decided to review contracts signed under the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act 2010, commonly known as the indemnity act, which allowed public contracts to be awarded without tenders and shielded government actions in the energy sector from judicial scrutiny.

Bangladesh is seeking a $6 billion budget support package from international lenders. The Ministry of Finance (MoF) aims to secure $1 billion each from the World Bank, the Asian Development Bank, and the Japan International Cooperation Agency, with an additional $3 billion requested from the IMF. The proposal letter has been sent following preliminary discussions, and formal negotiations are expected to begin soon.

The Advisers Council Committee on Economic Affairs approved, in principle, a proposal for emergency LNG procurement from the spot market to address the country's gas demand. The LNG will be sourced from 23 firms under Master Sale Purchase Agreements with Petrobangla, following Public Procurement Rules, 2008.

Linde Bangladesh Ltd has declared a 4,100% cash dividend, the highest since its Dhaka Stock Exchange (DSE) listing. This follows a dramatic 4,596.5% increase in profit to Tk 631.68 crore as of July 31, 2024, compared to Tk 13.45 crore the previous year. The earnings per share (EPS) soared to Tk 415.08 from Tk 8.84, mainly due to a capital gain from selling shares of its subsidiary, Linde Industries Pvt Ltd. Net operating cash flow per share (NOCFPS) also rose to Tk 13.19 from Tk 8.38. Linde's share price jumped 17.83% to Tk 1,547.30 after the dividend announcement.

Bangladesh's interim government will import liquefied natural gas (LNG) from the spot market following the Public Procurement Rules 2008, marking a first for the country. The advisory committee on economic affairs approved this new process and the import of LNG from 23 enlisted companies with Master Sale and Purchase Agreements (MSPAs) with Petrobangla.

The newly formed committee for the "White Paper on the State of Bangladesh Economy," led by Dr. Debapriya Bhattacharya, is set to review and analyze foreign loan agreements, with a focus on those related to the energy sector. Dr. Bhattacharya, a distinguished fellow at the Centre for Policy Dialogue, emphasized that the committee will evaluate these agreements and scrutinize available data against international standards. The committee aims to address a broad range of economic issues, including banking, resource mobilization, revenue collection, and poverty alleviation. They plan to consult with stakeholders and experts in various fields, both locally and internationally. The committee has allocated tasks among its members and intends to produce a comprehensive report within the next two months.