JICA joins IFC to invest $30 million in Bangladesh power plant

The IFC, a member of the World Bank Group, has brought in Japanese development agency JICA to invest $30 million in a Bangladesh power plant.

The Sembcorp North-West Power Company Ltd., a joint venture of Sembcorp Utilities and Bangladesh's state-owned North-West Power Generation Company Ltd., is building a 414MW dual-fuel combined-cycle power plant at northern Sirajganj.

The plant will “significantly” expand power-generation capacity in Bangladesh, the IFC said in a statement on Wednesday.

JICA’s $30 million is part of the total financing package of $ 165 million that includes a loan from IFC’s own account as well as additional loans mobilised through partners.

The total project cost is estimated at around $412 million.

The project is expected to be one of the “most efficient” plants in Bangladesh that will help modernise Bangladesh's power sector, JICA’s Senior Vice-President Kenichi Tomiyoshi was quoted as saying in the statement.

“JICA is privileged to partner IFC and other investors in this ambitious agenda to meet the power needs of millions of people”.

This transaction is IFC’s first co-investment with JICA since the two organisations signed a master cooperation agreement in April 2015.

Tang Kin Fei, Group President and CEO, Sembcorp Industries, said, Sembcorp's commitment towards supporting Bangladesh’s vision for continued growth and development is “further strengthened” with support from JICA, IFC, and other global investors.

“Sembcorp’s Sirajganj power plant will provide cost-effective and reliable energy solutions to the country for more than 22.5 years after its completion”.

The power plant will be the second largest power plant in power-starved Bangladesh and represents the largest foreign direct investment in this sector in recent years, the IFC said.

“The success of the project will demonstrate the profitability and sustainability of public and private-sector partnerships in Bangladesh’s power sector to international players, helping attract additional capital to the sector”.