BANGLADESH

A final decision on financing the Padma bridge project is yet to be taken, the finance minister said Tuesday, even though the government is scheduled to sign a memorandum of understanding with Malaysia.

"If we decide to go for PPP (public-private partnership scheme) all previous agreements with others will have to be cancelled," A M A Muhith told journalists at the Secretariat, reiterating that the Malaysian government is keen on taking up Bangladesh's biggest-ever infrastructure project to date.

"Talks with the World Bank (WB) regarding the Padma bridge are not over yet. But they have extended the effectiveness of loan by six months. But it is unacceptable" he said.

"Now we have to do some job. If the funding is to be sourced from a new channel four agencies including World Bank will be asked, 'How can you do that'."

He noted that there are two ways – the first one is direct loans and the second is PPP.

"But PPP is quite expensive. Since it's a big project, we'll need to see if it can be done directly with more investors," the minister added.

He said Malaysia's interest in investing in the Padma bridge project is a "different issue". "It is a PPP offer. I know about it. They (communications ministry) know about it," he said.

There will be discussions with the World Bank and other donor agencies before taking a final decision about the new way of funding the bridge, Muhith said.

Apart from the $ 1.2 billion pledged by the global lender, the government signed deals with Asian Development Bank for a $ 610 million fund, Japan International Cooperation Agency $ 400 million and Islamic Development Bank $ 140 million.

After the World Bank suspended the fund following allegation of corruption in the project, Malaysia expressed its eagerness to build the 6.15 kilometre bridge.