The New Nation - Internet Edition

Staff Reporter

Bangladesh has decided to request the Islamic Development Bank (IDB) to double its financing for fuel oil imports to US$2 billion as the country is struggling to meet the increased requirement from local sources.

A meeting on fuel oil financing at the Planning Ministry also decided to request the IDB to double the limit of an instalment of the financing to US$100 million.

At present the IDB provides around US$1 billion annually at an average instalment of US$49 million to finance fuel oil imports by Bangladesh.

Finance and Planning Adviser Dr Mirza Azizul Islam will place the request to the IDB and its trade-financing window, Islamic Trade Finance Corporation (ITFC), during the IDB's annual conference.

Dr Aziz will leave Dhaka Wednesday to attend the 33rd annual conference of IDB to be held on June 3-4 in Jeddah.

"If IDB accepts our request, it will reduce the pressure on foreign exchange and local financial institutions," the Adviser told newsmen after the meeting.

Chief Adviser's Special Assistant for Power and Energy Dr M Tamim and senior officials concerned were present.

Dr Aziz said the ITFC has already agreed with Bangladesh's request to finance the fuel oil imports at a rate of LIBOR plus 1.75 per cent (over 4 per cent). They earlier demanded a fixed rate of 5.5 per cent.

ITFC will deal with the trade financing issues starting from this year.