NEW DELHI: Bangladesh’s efforts to clear debts of more than $1 billion owed to Indian power companies are being hampered by its inability to access the dollars it requires to pay them, according to sources familiar with the matter.
The country has been struggling to pay its bills due to costly fuel and goods imports since the 2022 war in Ukraine, while political turmoil which led to the ouster of Prime Minister Sheikh Hasina last month has added to its troubles.
Bangladesh is urgently seeking $5bn in financial aid from international lenders to stabilise its dwindling foreign exchange reserves and its central bank has raised key interest rates to tame soaring inflation. Last year, it sought a $4.7bn bailout from the International Monetary Fund.
“Efforts are on to clear the outstanding payments, but the current dollar crisis is complicating the process significantly,” an official at the Bangladesh Power Development Board (BPDB) said on Friday.
Of the more than $1bn owed to India’s power companies, some $800 million is to Adani Power, he added.
Adani Power did not respond to a request for comment.
Two Indian firms, PTC India and SEIL Energy, have written to the BPDB to recover about $80m and $190m, respectively, in payment for power they provided to Bangladesh, documents show.
“PTC has a long-term business relation of supplying power to BPDB since 2013 and the power supply under (the) current contract is from 2022,” a PTC India spokesperson said.
An SEIL spokesperson said it had informed the Bangladesh authorities about what it called an “unsustainable situation”.
Published in Dawn, September 21st, 2024
