On July 18, 2023, the Indian High Commissioner to Bangladesh, Pranay Verma, called on the Prime Minister of Bangladesh, Sheikh Hasina at her official residence in Gonobhaban, Dhaka. They discussed issues such as the Rupee-Taka exchange system between Bangladesh and India connectivity and ongoing projects under the Indian Line of Credits and Grants.
During the meeting, it was emphasised that Bangladesh will be launching three infrastructure projects, including a power plant, under India’s financial assistance in September 2023.
The first project is the construction of a 660-Megawatt superthermal power plant. The project, in an area of over 1,834 acres, is situated 14 kilometres north of the world’s largest mangrove forest, Sundarbans, which is a UNESCO world heritage site.
The Power Plant would be the second unit of the Rampal Powerplant in southwestern Bangladesh. The Maitree Super Thermal Power Plant has been built as a 50:50 joint venture project, while the first unit of the project, also having a 660 MW capacity, was commissioned in December last year.
The plant is a joint venture by India’s state-owned National Thermal Corporation and Bangladesh Power Development Board.
The second project is the 65-kilometre-long Khulna-Mongla Port Railway Link. It was constructed under an Indian Line of Credit. The 64.8-kilometre Khulna-Mongla single-track broad gauge railway project will connect the two abovementioned cities and thereafter to Central and northern Bangladesh and also to the Indian Border at Petrapole and Gede in West Bengal.
As per the agreement between India and Bangladesh, IRCON, a public sector enterprise under the Indian Railways, has executed work on the Indian side, whereas the Texmaco Rail and Engineering related worked on the Bangladeshi side.
The third and last project, the Akhaura-Agartala (India Railway Link), was built under an Indian grant. These projects will be coinciding with Prime Minister Sheikh Hasina’s planned visit to India in September for the G-20 Summit.
The Rs 862.58 crore rail link from India’s Tripura to Bangladesh has been built under an Indian grant. The 15.064-km railway line will link Bangladesh’s Akhaura, through an international immigration station at Nischintapur along the Indo-Bangladesh border, to the outskirts of Agartala, the capital of Tripura in India.
The Ministry of Development in the Northeastern Region is bearing the cost of laying the 5km link on the Indian side, and the cost of the remaining railway line (10.014 long track on the Bangladeshi side) will be provided by the Ministry of External Affairs (MEA)
Last week, India and Bangladesh launched a trade transaction in a local currency mechanism in a bid to reduce dependence on the US Dollar and strengthen regional currency and trade.
It was the first time that Bangladesh started bilateral trade with a foreign country in any other currency other than the US Dollar, although the two countries stage frontier trading in certain areas like the border huts in a semiformal manner where both currencies are exchanged on a limited scale.
Under the formal arrangement from now on, trade will be transacted in rupee and then gradually in Taka. According to the latest official data from Dhaka, exports from Bangladesh to India amount to USD two billion, while Bangladeshi imports from India are worth USD 13.69 billion.
According to Bangladesh Sangbad Sangstha, the national news agency of Bangladesh, the Rupee-Taka exchange system between India and Bangladesh was discussed in the meeting
A spokesperson of the Bangladesh Prime Minister’s office said that Verma informed Hasina that two types of credit cards, including one Indian rupee and the other, would be based on Taka, the currency of Bangladesh. He also told Hasina that a huge chunk of Bangladeshis visits India for various purposes, and they can use the card.
