The Cabinet on Monday approved the draft of the inter-governmental state credit agreement to be signed between Bangladesh and Russia for constructing the Rooppur Nuclear Power Plant.
The approval came from the regular weekly meeting of the Cabinet held at Jatiya Sangsad Bhaban with Prime Minister Sheikh Hasina in the chair.
Briefing reporters after the meeting at the Secretariat, Cabinet Secretary Mohammad Shafiul Alam said the Russian government would provide $ 11.38 billion as credit out of the $12.65 billion nuke power plant, while the rest of the amount would come as grant and from Bangladesh government fund.
Responding to a question, he said the agreement is likely to be signed either in July or August this year.
The draft deal includes details on credit agreement, interest rate, and the project duration.
He said the Russian credit bears an interest rate of LIBOR-plus 1.75 percent which would not exceed 4 percent in interest rate. The credit will be repaid in 30 years with a 10-year grace period, while the loan repayment will start on March 15, 2027.
The credit repayment will be made twice a year on March 15 and on September 15 with two equal installments with the implementation of the credit from 2017-2024.
The Cabinet Secretary said the government would have to provide at least 10 percent of the overall contract value to the Russian contractor as advance for constructing the two nuclear plants.
Shafiul Alam said the Russian Bank for Development and Foreign Economic Affairs and Sonali Bank Limited would work as authorized bank for this credit.
He also informed that the minutes of discussion were also signed on May 19 this year during the meeting between Science and Technology Minister Yeafesh Osman and Russian Deputy Minister for Finance in Russia.
Earlier on December 25 last year, Bangladesh and Russia signed a $12.65 billion deal to commission two nuclear power plants, which will generate 2,400 megawatts of electricity.
Ministers and state ministers, and secretaries concerned were present.