The government on Tuesday signed Tk11,400 crore (165,861 million yen) loan agreements and exchange of notes with the Japanese government for two development projects under the official development assistance (ODA) loan package.
The loan will be given for Dhaka Mass Rapid Transit Development Project (Line-5 Northern Route) and Southern Chattogram Regional Development projects, said a press statement by the Economic Relations Division (ERD) under the finance ministry.
Officials also signed a grant agreement for another project.
According to the press statement, Fatima Yasmin, ERD secretary and Ito Naoki, Japan's ambassador to Bangladesh, signed the agreements on behalf of their respective governments.
Under the agreements, Japan will lend Bangladesh 133,399 million yen (Tk9160 crore), for the second tranche of the Dhaka Mass Rapid Transit Development Project (Line-5 Northern Route) and 34,462 million yen (Tk2366.4 crore) for the Southern Chattogram Regional Development project.
The Dhaka Mass Rapid Transit Development Project (Line-5: Northern Route), will build a 20km metro rail line. There will be a 6.5km elevated metro rail from Hemayetpur to Aminbazar and a 13.5km underground metro rail from Aminbazar to Bhatara.
In September 2019, the project received government approval.
The project will cost a total of Tk41,238 crore, of which Tk29,117 crore will come from Jica.
In 2020, Jica already provided 55,696 million Japanese yen (Tk4,528 crore) for the project. Now, the development agency is providing the second tranche of financing.
According to the implementing agency, Dhaka Mass Transit Company Limited (DMTCL), a feasibility study and basic design have been completed for launching the metro rail from Hemayetpur to Bhatara by 2028.
Work on various surveys, detailed design, and land acquisition is now ongoing. The detailed design is 51.60% completed, it added.
Land acquisition is 60% completed for the first east-west MRT corridor of Dhaka being constructed on this route.
Meanwhile, the standard of living for residents of Chattogram, Cox's Bazar and Bandarban districts, will improve with the infrastructure development under the Southern Chattogram Regional Development project. The project is set to be complete within 2028.
Besides, Japan will provide an additional 128 million yen (Tk9.57 crore) for improving meteorological systems in Dhaka and Rangpur by replacing two conventional radars with a Doppler radar system. The project, being implemented by the defence ministry, is expected to be complete by 2024.
The press statement said the Japanese government will loan the money for the projects at an interest rate of 0.70% for construction, 0.01% for consultancy services, and 0.2% for the front-end fee (at a time). The repayment period for the loans has been set at 30 years with a 10-year grace period.