Bangladesh backs renewables, energy efficiency through USD-218.7m fund

The 28-MWp solar park in Technaf, Bangladesh. Image by: Proinso (www.proinso.net).

May 5 (Renewables Now) - Bangladesh has launched a USD-218.7-million (EUR 200.8m) Green Transformation Fund (GTF) through which it will provide soft loans to participants in a number of industries, including renewable energy.

In particular, the fund will support the renewable energy and energy efficiency, water conservation and management, waste management, resource efficiency and recycling sectors. It will facilitate the import of environment-friendly products, according to data and analytics company GlobalData. The GTF is in addition to the existing USD-200-million fund to offer soft loans for dollar-denominated imports.

“Access to low interest loans will be a much needed relief, especially post-COVID-19 as projects may be delayed due to liquidity and supply chain issues,” said Somik Das, Senior Power Analyst at GlobalData.

The company, though, noted that the margin of 3% covered by the lender and central agency -- 1% by the central bank and 2% by the authorised lender -- may not provide full relief in a post COVID-19 market scenario. It explained that the GTF’s lower interest rates may not be able to compensate for the impact of increased equipment costs arising from supply chain issues.

(USD 1.0 = EUR 0.918)

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