Bangladesh
Rooppur Nuclear Power Plant Russia wants repayment of nuclear power plant loan in ruble-yuan
Dhaka, October 3: Russia has loaned USD 500 million for the feasibility study of Rooppur nuclear power plant. Bangladesh has paid this loan in eight installments with interest. 9.84 percent of the loan or $10 crore is still outstanding.
Western countries have imposed sanctions on various Russian banks after the attack on Ukraine. Due to this complication, Bangladesh is not able to return 10 crore dollars to Russia. To solve the crisis, Russia has offered Bangladesh to pay the debt in its own currency, ruble and Chinese yuan. However, the Economic Relations Department (ERD) could not reach any decision in this regard.
According to ERD sources, Russia made this proposal in view of Western countries' sanctions and expulsion of Russian banks from SWIFT, a global trading system, after engaging in war with Ukraine. However, Bangladesh has not yet taken any decision regarding payment in ruble or yuan. The proposal is being reviewed by the ERD.
When the Rooppur nuclear power plant project was approved, certain agreements were made based on the law. If the new ruble or yuan is given, the contract will have to be revised. To pay in rubles or yuan, there are several steps to go through. One of these ruble or yuan should be bought by selling dollars. Because there is no solid source of ruble or yuan in Bangladesh. Also, rates fluctuate all the time. As such, the US dollar is very stable. So, Bangladesh will face loss in this. It is more beneficial for Bangladesh to pay in dollars. Because a lot of remittances come into the country in dollars. Besides, exports are also done in US dollars. If you want to pay any currency outside of this, you will have to buy and sell dollars.
According to the terms of the Russian loan, Bangladesh will have to pay interest only until 2026 and thereafter in interest and principal installments. Russia has sent two letters to Bangladesh regarding Rooppur loan repayment. The first letter was issued on June 23. It proposes to amend the clauses of the Inter-Governmental Credit Agreement (IGCA) signed between the two countries. Then on August 10, Russia sent another letter. It offers transactions in rubles in view of the ban on transactions in US dollars and euros.
