Bangladesh signs power plant deal with India

DHAKA, February 20, 2010 (AFP) – Energy-hungry Bangladesh has signed a 1.7-billion-dollar deal with India to build two coal-fired power plants in the country’s south to ease a huge electricity shortage, an official said Saturday. The deal highlights Dhaka’s improving ties with New Delhi under its new secular government led by Sheikh Hasina’s Awami League party, Bangladesh analysts say. The two plants, which will have a total daily capacity of 1,320 megawatts, will help alleviate the severe power shortfalls suffered by impoverished Bangladesh.

The plants will be constructed by Dhaka’s Power Development Board and India’s National Thermal Power Corp and be ready in three years, Dhaka’s Power Development Board spokesman Bazlul Haque told AFP.

The two companies, both state-owned, will share the 1.7-billion-dollar cost of building the plants, which will be managed by the Indian company and will use imported coal, Haque said.

Officials from the two countries signed the agreement in Dhaka late Friday, he said, adding that a four-month feasibility study will be carried out before construction starts in July.

Bangladesh has long suffered severe power outages due to demands imposed by its fast-growing economy. The p