Touhid in Beijing: China agrees to extend loan repayment period by 10 years for Bangladesh

Meeting of Touhid Hossain-Wang YI

• Two sides emphasised continued cooperation under the Belt and Road Initiative
• Expressed willingness to work closely on proposed Chinese-funded projects
• Some of the projects are - Dasherkandi Sewage Treatment Plant, Upgradation of Mongla Port, and 4G Expansion

China has agreed to extend the loan repayment period for Bangladesh from 20 years to 30 years for both the Preferential Buyer's Credit (PBC) loan and Government Concessional Loan (GCL).

Praising Bangladesh's good track record in loan repayment, Chinese Foreign Minister Wang Yi agreed in principle to extend the loan repayment period during a bilateral meeting with Bangladesh Foreign Adviser Touhid Hossain, who is visiting the country on a three-day official trip, reads a press statement issued today (21 January).

At the meeting, held this morning at the Diaoyuitai State Guest House in Beijing, Touhid requested China to "reduce interest rates from 2-3% to 1%, waive commitment fee and extend loan repayment period from 20 years to 30 years for both the Preferential Buyer's Credit (PBC) loan and Government Concessional Loan (GCL)."

The Chinese minister also "assured to look into the request for the interest rate reduction. He assured to continue the DFQF access of Bangladeshi products to the Chinese market for three years after the LDC graduation", says the foreign ministry statement.

"Upon Bangladesh's request, Foreign Minister Yi conveyed China's decision to especially designate 3 to 4 recognised hospitals in Kunming for treatment of Bangladeshi patients," the press statement further said.

He also welcomed Bangladesh's proposal of establishing a specialised tertiary level Chinese hospital in Dhaka as a gesture of goodwill on the occasion of the 50th anniversary of Bangladesh-China diplomatic relations.

The Chinese minister also gave positive responses to consider Bangladesh's requests for financial, technical and capacity building cooperation and support in sectors such as education, railway, agriculture, water resource management, livestock, fisheries, shipbreaking, sustainable and renewable energy, and the blue economy.

During the meeting, the two countries reaffirmed their commitment to Comprehensive Strategic Cooperative Partnership. 

Adviser Touhid is paying the official visit to China at the invitation of the Chinese foreign minister. This is his first bilateral visit abroad after assuming charge of the foreign ministry.

Senior officials from the ministries of commerce, water resources and the Economic Relations Division are accompanying the adviser.

This visit also coincides with the celebration of the golden jubilee of diplomatic relations between the two friendly nations.

Adviser Hossain was warmly welcomed by Foreign Minister Wang Yi before the bilateral talks, reads the press statement.

The talks were held in a very cordial atmosphere covering a wide range of topics, including development cooperation, trade and investment, infrastructure development, sectoral cooperation, and people to people exchanges. Both sides expressed their commitment to deepening collaboration in areas of mutual interest and leveraging opportunities for shared prosperity, it adds.

At the meeting, Adviser Touhid emphasised that his first bilateral visit to China reflects Bangladesh's strong intent to engage with China in a robust partnership to give the relationship a new momentum.

He reiterated Bangladesh's firm commitment to 'One China Principle' and unwavering support for UNGA Resolution 2758.

The adviser said the July-August 2024 uprising in Bangladesh gave an opportunity to rebuild the nation on the principles of equality, non-discrimination, corruption free system and equal access to resources for all.

During the talks, the Chinese minister stated that the people of Bangladesh have given an important responsibility to Chief Adviser Muhammad Yunus, who has dedicated himself in maintaining civility and unity of the country, and his government has done many tangible good things for Bangladesh.

"China places Bangladesh at a very important position in its neighborhood diplomacy and it praises the existing warm relations between the two nations," he also said.

He recalled his fruitful meeting with Chief Adviser Muhammad Yunus on the sidelines of the last UNGA. 

Wang Yi reaffirmed that China respects the sovereignty and territorial integrity of Bangladesh and reiterated continued Chinese support for the stability, reforms, democratic transition, and development initiatives of Bangladesh.

He also mentioned that China wants to see Bangladesh's economic development in pace with their own development.

"China would continue supporting projects conducive to the livelihood of the people of Bangladesh," he stated.

During the meeting, both sides conveyed their readiness to organise a host of activities to celebrate the 50th anniversary of the diplomatic relations between Bangladesh and China in a grand manner.

Recognising Bangladesh's strategic position, two sides emphasised continued cooperation under the Belt and Road Initiative (BRI).

They expressed their willingness to work closely on proposed Chinese funded projects namely Dasherkandi Sewage Treatment Plant, Upgradation and Modernization of Mongla Port, Establishing Digital Connectivity and 4G Expansion.

"Both leaders discussed the Rohingya crisis and reaffirmed their shared commitment to work on a roadmap to finding a durable solution to the issue. Foreign Minister Wang Yi reassured China's continued engagement with Myanmar to address the situation and promote regional stability," the press statement reads.

Wang Yi also requested Bangladesh to consider joining Chinese President Xi's three global initiatives namely GDI, GSI and GCI. 

In response, Bangladesh conveyed its intention to examine the proposals and to remain engaged with China in deliberations on the issues.

They also agreed to collaborate on each other's candidature in multilateral fora including in the United Nations.

The talks concluded with the signing of the 'Implementation Plan of the MoU on Exchange of Hydrological Information Sharing of the Yaluzangbu-Jamuna River'.

Adviser Touhid extended an invitation to Minister Yi to visit Bangladesh at a mutually convenient time.

The Chinese minister hosted a lunch in honour of the adviser and his delegation.

Foreign Adviser Md Touhid Hossain also had a meeting with the Minister of International Department of the Chinese Communist Party.

During the meeting, they discussed Chinese funded development projects in Bangladesh. They also talked about the reform initiatives of the interim government in Bangladesh.

The Chinese minister reaffirmed China's continued support for the interim government and peaceful transition to democracy through a free, fair and participatory election.

'Will consider further reduction of interest rate': CIDCA chairman

Hossain also held a meeting with the Chairman of China International Development Cooperation Agency (CIDCA) this afternoon.

They had an elaborate discussion on the China funded projects in Bangladesh.

Adviser Touhid requested the CIDCA chairman to consider reducing the interest rate of GCL and PBC Loan from 2-3% to 1% and to extend the maturity period from 20 years to 30 years.

He also requested to waive the commitment fee and management fee for Chinese loans to Bangladesh.

The CIDCA chairman mentioned that they have already extended the maturity period and they will consider further reduction of interest rate. 

The adviser requested the CIDCA chairman to increase the amount of concessional loans and grants, and number of projects.

The CIDCA chairman responded positively and requested Bangladesh to provide a list of priority projects.

Both sides also discussed financing of projects in metro rail and Southern Infrastructure Development Initiative (SIDI) in Bangladesh.

The CIDCA chairman noted that China may consider larger projects in Bangladesh in future some portion of which will be given as grants.

As a result, this will reduce the average loan interest rate. 

Adviser Touhid arrived in Beijing yesterday at midnight.

He was received by Bangladesh Ambassador to China Md Nazmul Islam and high-level officials from the Chinese Foreign Ministry.