The Bangladesh-China joint working group will sit for its first meeting next week, incorporating a new agenda centring Beijing’s interest in investment and trade, to devise ways for expediting implementation of China-funded projects.
A deputy minister will lead some 30 representatives of China at the meeting at the Economic Relations Division on Monday when at least 10 issues of both sides will be discussed.
The joint working group was formed to probe slow progress of 27 projects involving around $20 billion that China had agreed to provide during President Xi Jinping’s Dhaka visit in October 2016.
During Prime Minister Sheikh Hasina’s visit to China in July this year the two sides signed an agreement to form the working group to identify reasons for the delay and eliminate those.
A finance ministry official said the Chinese side was likely to raise five issues in the meeting.
One would be on China’s interest on increasing investment and on the facilities that would be provided to Chinese companies to attract such funds.
The Chinese side will also talk on expanding cooperation for the rapid implementation of a special industrial park, where their nationals would invest in different sectors.
The official said China was interested in discussing public-private partnership (PPP) projects, in which Chinese companies would be able to invest and their nationals get employment.
China will raise the issue of strengthening cooperation between its companies and the local community to build good relations to ensure security of the companies.
This was to avoid repetition of an incident a few months back when a Chinese worker was killed at the Payara coal-fired power plant.
Besides, China will raise problems faced by its contractors in implementing projects like slow land acquisition and approval delays of engineering drawings.
The finance ministry official said Bangladesh was likely to raise issues such as rapid approval of the Chinese government’s project financing offers, terms and conditions of loans and approval procedures.
Bangladesh will discuss swapping some of the 27 projects for new ones as it does not want to implement those with Chinese financing.
For instance, the source of finance for the Dhaka-Sylhet four lane project has been switched to the Asian Development Bank.
With much pomp and circumstances, Xi Jinping arrived in Bangladesh in October 2016, the first visit by a Chinese president in 30 years.
He left with a promise to provide about $20 billion -- the largest amount yet by a single country -- over the next four years for Bangladesh’s development, as Beijing looked to one up New Delhi in their contest for geopolitical influence in South Asia.
Three years on, only one-fourth the amount entered the aid pipeline -- an anticlimax of sorts.
Some 27 projects are supposed to be funded with the $20 billion as per the initial agreement of October 2016.
As of this month, loan agreements -- which is the last step before the release of funds -- for seven projects involving $5.4 billion were signed. Till July $981.36 million was disbursed.
Red tape on both sides is largely to blame for the snail’s pace of loan processing for the implementation of projects, according to officials of finance and other ministries concerned.
“Having said that, whatever the amount China has released thus far is a big step up when viewed from a historical perspective. They always made negligible donations and their assistance was mostly in the form of cheaper contracts,” a senior finance ministry official told The Daily Star.
Since 2016, $1.8 billion was committed on an average each year, which is in line with what the multilateral lenders do.