FIRST INSTALLMENT TO CHINA-LED AIIB : Govt to allocate Tk 212 crore

The ministry of finance is set to make an allocation of nearly Tk 212 crore against capital expenditure, to own one fifth of the 0.67 per cent share for Bangladesh in China-led Asian Infrastructure Investment Bank.
The allocation will be made from the head of ‘capital block allocation and misc capital expenditure’ of the current budget, a top finance official said. As the agreement of the Bank was signed at the end of June, no specific allocation in the budget to subscribe the share of the multi-lateral bank was made, he added.
The amount is equivalent to US$26.42 million, to be paid in the US currency. The amount is one fifth of the $132.10 million the country is to pay in five years equally in five installments, a senior economic relations division official under the finance ministry said.
The official, requesting anonymity, said the first installment of the paid-up capital share must be disbursed within 30 days after the agreement was made effective.
‘As the 57 member countries, including Bangladesh, are in the process of ratifying the agreement of AIIB, it is expected that first installment will be due sometime in November or December,’ the ERD official concerned told New Age.
‘We have sought the budgetary allocation from the finance division, ministry of finance.’
The official sources in the finance division said they had started the process to earmark Tk 212 crore from the Tk 5490 crore allocated against capital block allocation and misc capital expenditure in the budget.
The authorised capital of AIIB is $ 100 billion, while the paid-up capital is $20 billion to be subscribed by member countries based on their number of shares in the bank.
The finance ministry official sees ample scope to secure low-cost fund to kick start its much needed large infrastructure projects such as on power, energy and physical infrastructure from the 57-member infrastructure bank, which formally came into being on June 29 in Beijing.
While the amount of subscription to own the 0.67 per cent share stands at $US 660.50 million for Bangladesh, which is fixed for all 57 founding members on the basis of their GDPs, the country, however, has to pay only $US 132.10 million as paid-up capital in five installments in the next five years, state minister for finance and planning MA Mannan told New Age.
While all south Asian nations are members of AIIB, India holds the largest share of 8.52 per cent of the bank among the countries of the region. Being the sponsoring country, China’s share on the bank is 30.34 per cent, with South Korea and Indonesia having 3.80 per cent and 3.42 per cent stake respectively.
‘The paid-in capital will account for 20 per cent of the subscribed capital, in installments, in the form of convertible currencies and/or non-convertible currencies as the Bank agrees,’ said the Articles of Association of AIIB.

News Courtesy: www.newagebd.net