DHAKA: The $1.4 billion financing plan between Bangladesh and the International Islamic Trade Finance Corporation will help smooth out imports of crude oil for the South Asian nation, authorities in Dhaka said on Sunday, with the agreement expected to come into force this month.
The Bangladesh Petroleum Corporation, which controls the import and marketing of fuel in the country, signed the agreement with the Jeddah-based ITFC during a recent visit of a Bangladeshi delegation to the Saudi port city.
“Under this financing agreement we will take a loan of $1.4 billion, mainly to import crude oil,” BPC finance director Kazi Mohammad Mozammel Haque told Arab News.
Bangladesh has previously signed similar agreements with the ITFC, he added, with the current financing plan in effect from July 2023 to June 2024.
The ITFC is a member of the Islamic Development Bank Group, the largest development organization in the Muslim world and also based in Jeddah.
Bangladesh imports about 100,000 tons of crude oil every month, mostly from Saudi Aramco and the Abu Dhabi National Oil Company, which already have relations with the ITFC, Haque said.
“It’s very convenient for us as Saudi Aramco and ADNOC rely on this lender. That’s why our crude oil imports become smooth.”
The ITFC has approved more than $16 billion in loans for Bangladesh since 2008 to support the country’s energy security, it said in a statement, adding that such agreements are part of its “commitment to support the economic development of its member countries.
“With both parties having agreed to the terms of the financing, this financing plan will ensure the energy security of one of South Asia’s fastest-growing economies,” ITFC said.
“This agreement is a testament to the longstanding successful partnership between the two parties.”