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Infrastructure & PPPs in Bangladesh, Nepal and Sri Lanka - Q3 2023 Update

YOG INFRA Q3 2023 insights

BANGLADESH took a notable step in its PPP journey through regulatory changes regarding independence of it's central PPP authority, and it remains to be seen its impact in terms of alignment of projects with relevant govenrment agencies. Both NEPAL and SRI LANKA have seen low PPP activity, with a fw projects planned by governent agencies, via support from multilateral development banks (MDBs).

Read more about key developments in Infrastructure and PPPs in the three countries in our insight.

 

Bangladesh

BANGLADESH LAWMAKERS CURTAIL PPP AUTHORITY'S INDEPENDENCE

Bangladesh passed a bill limiting the remit of the country’s Public-Private Partnership Authority. The Bangladesh Public-Private Partnership (PPP) (Amendment) Bill, 2023, was passed despite resistance from opposition lawmakers. In the amendment, the word independent has been dropped from the existing law that states that the authority will be impartial and independent while exercising its powers in discharging its duties.

The power to appoint a CEO has also passed over to the government, which was earlier with the board of governors of the PPP Authority. Opposition parties said the strict government control would increase complexity, hinder private investments and that the central PPP body was now weakened.


CHINESE RENEWABLES DEVELOPER CHINT PLANS BANGLADESH PROJECTS

Chint Energy is seeking to build its Bangladesh solar portfolio, with more than 250 MW of solar projects planned in the pipeline. The private-sector power group, which specializes in solar project development and equipment manufacturing, has submitted proposals to the Bangladeshi government for a few utility-scale solar projects, including a 200 MW solar farm and a 10 MW floating solar project. It is looking to secure commercial and industrial rooftop solar contracts either in the build, own, operate or engineering, procurement and construction method.

Chint will build some of the projects with local partners and will source equipment and systems from its factories for the assets it develops on its own. The company has recently received a letter of intent from the government to develop a 50 MW solar farm in Dimla township in Rangpur division and it has completed a feasibility study, land acquisition, environmental impact assessment and feed-in tariff negotiations. It will now aim to sign a power purchase agreement with the government at BDT 10.698 (USD 0.098)/kwh.


AIIB APPROVES USD 75 Mn FOR BANGLADESH HIGHWAY PROJECT

The Asian Infrastructure Investment Bank (AIIB) has approved USD 75 Mn in financing for a public-private partnership highway project in Bangladesh. The project involves the development of a four-lane, 13.5 Km access-controlled road connecting highways from Chittagong and Sylhet, and central Dhaka.

The proposed expressway is a 13.5 km four-lane, controlled-access, toll road including 9.4 km of elevated sections from Rampura point of Hatirjheel to the junction with the National Highway No.1 (Chittagong Road) and the National Highway N2 (Sylhet Road). About 9.4 km of the motorway will be elevated. The estimated project cost is USD 261 Mn.


JICA'S INTEREST IN BOOSTING INFRASTRUCTURE LOANS FOR BANGLADESH

Japan International Cooperation Agency (JICA) wants to invest in Bangladesh, with priority given to infrastructure projects. Besides, it is keen to provide loans for human resource development, especially health education and rural infrastructure. Bangladesh has also signed loan agreements with Japan totaling more than USD 25 Bn since the independence of the South Asian nation in 1971.


Sri Lanka

SRI LANKA SHIFTS EXPRESSWAYS SUPERVISION TO STATE-RUN AUTHORITY

The Sri Lankan Cabinet has cleared the transfer of management of expressways to state-run company Sahasya Investments (SIL). The expressway network was maintained by the country's Road Development Authority till now. The potential to implement a public-private partnership through SIL is being discussed and the company will look at using vacant land to generate renewable energy. The government will help SIL repay loans taken out to construct the expressways until its financial position has strengthened.


SRI LANKA TO DISCUSS RESTART OF RAIL PROJECT WITH JAPAN

The Sri Lankan Cabinet has given its nod to President to decide on a suitable timeline to reactivate the USD 2.2 Bn light rail transit (LRT) project with Japan.The island country suspended the rail project in 2020 due to financial issues. The Sri Lankan government will soon decide the way forward for a USD 4 Bn LRT line that it shelved in 2020.


Nepal

BHAIRAHAWA AND POKHARA AIRPORTS TO BE OPERATED IN PPP MODEL

The preparations are being made to operate the Gautam Buddha International Airport and the Pokhara Regional International Airport under a PPP (public-private partnership) model.

The government is preparing to operate both the airports built with huge investment through the PPP model and the work is going on according to the plan of Bhairahawa and Pokhara airports. The Work is being done with the plan of operating both the airports that were built with large investments and not only Bhairahawa and Pokhara, but also the airports of various districts which have been constructed but are not yet operational, are being prepared.

 

List of Key Transactions - Bangladesh Q3 2023

 

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