BTRC plans to borrow €157m from HSBC for satellite
The telecom regulator yesterday sent a proposal to the government to borrow 157 million euros from HSBC for the country's first space satellite.
The interest rate for the loan will be Libor plus 1.51 percent. The London interbank offered rate is considered to be one of the most important interest rates in finance.
Bangladesh Telecommunication Regulatory Commission sent its recommendation to the telecom division for its final approval on the loan. The proposal will also need vetting from the law ministry.
"We hope the approval will come within a short time and we can sign the loan agreement by the first half of August," said BTRC Chairman Shahjahan Mahmood.
The money will be spent on the spacecraft's design and installation with insurance coverage, according to senior BTRC officials.
The BTRC has already paid about 71 million euros in three instalments to Thales Alenia Space, a French aerospace manufacturer, by borrowing money from a local bank. The money will be adjusted after getting the loan from HSBC.
The fourth instalment has to be paid by August 22 and the BTRC chief is very hopeful it can pay it from the loan.
Apart from the loan, the government will also spend 56.5 million euros from its own resources for launching the satellite.
Last November, the BTRC signed a $248-million deal with Thales Alenia Space for the design, manufacture and launch of the satellite.
The satellite project's estimated cost is Tk 2,967 crore, of which Tk 1,314 crore will come from the Bangladesh side.
Officials said the cost would come down ultimately as the BTRC has received offers lower than the price estimated two years ago.
Mahmood said Thales Alenia Space has started manufacturing different parts of the satellite, and by the end of October it will start assembling it.
He said a team from the BTRC will go to France for attending the final meeting on the satellite design.
Thales Alenia Space will take a year to assemble the satellite and is scheduled to hand it over to the BTRC by November 2017.
Then, the BTRC will have to take it to Florida's Cape Canaveral for the launch.
Meanwhile, the telecom regulator is working to form a public limited company named Bangladesh Satellite Communication Ltd to look after the commercial and broadcast satellite.
Senior officials who are involved with the project said they have received approval from the Office of the Registrar of Joint Stock Companies and Firms for the new entity.
Currently, Bangladesh meets its need for satellite connectivity by renting bandwidth from operators, which costs the country almost $14 million a year. The satellite will save the money.
The project will reach break-even in seven years after the launch and allow the regulator to sell excess capacity to other nations.
The Bangabandhu-1 satellite is expected to provide services to all South Asian countries as well as Indonesia, the Philippines, Turkmenistan, Kyrgyzstan and Tajikistan, if its frequency is properly coordinated.
The government has further plans to launch two more satellites.