Govt okays $1.05b loans for Biman, BPC

The government has approved $1.05 billion in commercial loans to import fuel for Bangladesh Petroleum Corporation and procure two new aircraft for Biman Bangladesh Airlines.
The approval was given at a meeting of the hard-term loan committee yesterday.
A finance ministry official said the loan being taken to purchase oil is a short-term credit facility for six months.
Two companies of Malaysia and the Philippines will receive deferred payments and it will be treated as a loan for six months at an interest rate of 5.03 percent.
Petronas Trading Company of Malaysia will get a deferred payment worth $693 million and Philippines National Oil Co will receive $279 million.
An official of Bangladesh Petroleum Corporation said demand for diesel and furnace oil has shot up substantially for the set of new oil-based power plants.
They estimate fuel worth about $6 billion will have to be imported in the current fiscal year, which was $4 billion last fiscal year.
The official said Bangladesh Petroleum Corporation is going to borrow $1.45 billion from International Islamic Trade Corporation in 2011. Of the amount, it has already taken $660 million at an interest rate of 5.3 percent.
Bangladesh Petroleum Corporation will also borrow $200 million from Standard Chartered Bank, Citi Bank NA and HSBC at 5.3 percent interest.
Besides, Biman Bangladesh airlines will borrow $80 million from Standard Chartered Bank to procure two new aircraft. The rate of interest will be LIBOR for 3 months plus 5 percent.
A finance ministry official said they will require a minimum of $310 million to buy the planes, which includes the amount Standard Chartered will give. Biman will collect the rest from other sources.
Next year, two new Boeing-777-300 aircraft may be added to its fleet.