BTRC to take Tk 430cr from Sonali Bank to start satellite project

The telecom regulator will take a Tk 430 crore loan from Sonali Bank to finance the launch of the country’s first satellite Bangabandhu-1 in 2017, after it failed to secure foreign loans for the project.

Local loans are being sought to meet the deadline for the project, said Tarana Halim, state minister for telecom.

“We have time limitations. We are already in the sixth month since the deal was signed with the satellite company,” she added.

On November 11 last year, Bangladesh Telecommunication Regulatory Commission signed a $248-million deal with France-based Thales Alenia Space for the manufacture and launch of the satellite.

It was also mentioned in the project document that it will be a bidder-financed project, where the winning bidder will arrange the foreign loan.

Satellite Project Director Md Golam Razzaque had also mentioned that the total cost of the project will run into Tk 2,967.95 crore, with about 56 percent of the amount coming from foreign loans. The government would pay the rest.

A high official of the BTRC said local loan is being taken as the negotiation process for foreign loans is slow.

“The local loan will be used to kick-start the project. We will have the foreign loans later as the negations are under way.”

The BTRC is currently negotiating with HSBC, which has offered to lend Tk 3,000 crore at an annual interest rate of 0.5 percent, the official said.

But the telecom regulator is negotiating for the interest rate to be brought down to 0.2 percent, he added.

The bank also proposed that the loan be repaid in 10 years, but the BTRC has asked HSBC to extend the payment period by two more years.

HSBC had also wanted a 1.50 percent structuring and coordination fee, but it was finally fixed at 1.45 percent. The BTRC agreed to pay 0.38 percent as commitment fee, while HSBC has quoted 0.42 percent.

To get the loan from Sonali, the regulator has submitted a guarantee of Tk 870 crore, which it collected from mobile operators in the last five years under the Social Obligation Fund (SOF).

The SOF was supposed to be used to expand digital services to the remotest areas of the country.

Currently, Bangladesh meets its need for satellite connectivity by renting bandwidth from operators, which costs almost $14 million a year.

The project will break even in seven years and allow the regulator to sell excess capacity to other nations.

Bangabandhu-1 will be able to provide services to all South Asian countries as well as Indonesia, the Philippines, Turkmenistan, Kyrgyzstan and Tajikistan, if its frequency is properly coordinated.