As part of the nearly € 340 million long-term soft loan agreement signed between the two countries, Germany will provide more than € 237 million for renewable energy and energy efficiency projects in Bangladesh.
The concessional financing will be used for energy transformation projects of the Bangladeshi authorities such as Bangladesh Infrastructure Development Co., Ltd. (IDCOL), Bangladesh Infrastructure Finance Fund Co., Ltd. and Bangladesh Power Grid Corporation. The remaining cash for development will be used for sustainable urban development; good governance; displacement and migration policies; training and sustainable growth for decent employment; and conservation of biodiversity.
Bangladesh Deputy Minister of Economic Relations Moslema Naznin confirmed that the agreement signed on Sunday will take the form of soft loans.
IDCOL officials said that some of the new credit lines will provide funding for irrigation pumps powered by rooftop and ground installations, on-grid solar and off-grid photovoltaics. Energy efficiency requirements will mean equipment financing in sectors such as the textile and clothing industries. IDCOL CEO
Mahmood Malik said that so far, government agencies have received more than 237 million euros from the German government in the form of grants and loans. The figure includes 60 million euros loaned by the KfW Development Bank, which provides solar power for rooftops in South Asian countries, and 20.5 million euros in grants from the same source, mainly for solar irrigation pumps and biogas projects.
’s previous support includes IDCOL’s 37 million euro grant from KfW and the German development agency Deutsche Gesellschaft für Internationale Zusammenarbeit in 200506 for solar home systems and biogas installations.
Since IDCOL also manages the $102 million (85.6 million euros) rooftop solar loan program provided by the World Bank, Malik said that the scale of funding provided by international donors means that public institutions can consider supporting ambitious projects as 12 MW The solar roof project was proposed by an unspecified entrepreneur.
Peter Fahrenholtz, German Ambassador to Dhaka, welcomed the signing of the latest loan agreement on Sunday and said: “We are very happy to continue to support Bangladesh’s success story.”
The Bangladeshi government stated that the country has 746 MW of clean power generation capacity. .