Costly nuclear power project to get final nod today
The Rooppur nuclear power plant project involving Tk 113,093 crore is set to get the green light today, making it the most expensive project in the history of Bangladesh.
In fact, the project's cost is more than the national budget of fiscal 2009-10, which stood at Tk 110,520 crore, according to the Economic Review.
The expenditure for the nuclear power plant is about one-third of the current fiscal year's budget of Tk 340,605 crore.
Russia's state export credit will account for Tk 91,040 crore or 80.5 percent of the total project cost, with the government chipping in with the remaining amount, according to the project's proposal.
For the Russian loan, the rate of interest will be 1.75 percent plus Libor and the loan has to be repaid over 20 years with a grace period of 10 years. The interest rate will never be more than 4 percent, and the loan is neither concessional nor commercial.
Bangladesh has already received $500 million for initial work of the 2,400-megawatt power plant project, which kick-started in July 2016. The project is expected to be complete by December 2025.
Russia's state-owned Rosatom State Atomic Energy Corporation will implement the project.
As per the plan of Rosatom, the main construction work will start in 2017. The first unit is expected to go into production in 2022 and the second in 2023.
The plant would use a new generation reactor that has a lifespan of 60 years with the option of extending it for another 20 years, according to a planning ministry official.
The reactor contains improved safety features, and its passive safety system is capable of working for 72 hours in case of any critical or emergency situation, the official added.
However, the Russian loan for the plant would be a major debt burden considering the current level of Bangladesh's foreign borrowing.
The country's debt burden is now $18 billion, and at the current pace of external borrowing it will go up to $30 billion in five years' time, according to an estimate of the finance ministry. It would balloon to $42 billion if the Russian loan is included.
In 2009, the government had initially estimated that the nuclear power plant would cost between $3 billion and $4 billion.
However, similar plants are now being built by Russia in different countries with price tags ranging from $10 billion to $13 billion.