Bangladesh and India have signed a framework agreement for utilisation of $500 million line of credit extended by New Delhi last year and two other memorandums of understanding for collaboration between the naval forces of the two countries.
The agreement and the MoUs were signed after talks between a defence delegation led by Lt Gen Mahufuzur Rahman, principal staff officer of Bangladesh Army, and Indian Defence Secretary Sanjay Mitra at the South Block in New Delhi on Wednesday, a senior Bangladeshi official said yesterday.
Under the framework agreement for use of the line of credit, Bangladesh will identify its defence hardware needs and India will examine the armaments it makes so that the two sides can move forward in this sector, said the official who was present at the meeting.
Bangladesh can also use a “certain percentage” of the $500 million line of credit to buy weapons from countries other than India subject to India's approval, the official added.
Besides, Bangladesh has to make a major part of the defence procurement under the line of credit from India.
This was the first formal meeting between the two countries specifically on defence cooperation since they signed their first overarching bilateral defence cooperation agreement during Prime Minister Sheikh Hasina's official visit to India in April last year. Under that agreement, India would provide $500 million to Bangladesh to procure military hardware.
Two separate MoUs were signed by the Bangladesh Navy's Khulna shipyard and Indian Navy for collaboration on joint projects, the official said.
Asked if this meant for joint production of warships, he did not specify.
Another MoU was signed for a programme of exchange of students of military schools in India and Bangladesh.
The meeting also discussed how the India-Bangladesh defence cooperation could be enhanced through more joint exercises and expeditions.
While economic and connectivity projects between India and Bangladesh have gone up substantially in the last eight years, the two countries for the first time diversified their cooperation in the defence sector in April 2017.
Prior to Wednesday's meeting and the signing of the MoUs, the visiting Bangladeshi delegation called on Indian Defence Minister Nirmala Sitharaman, Foreign Secretary Vijay Keshav Gokhale and chiefs of the Indian army, air force and navy, according to the official.