Russia seeks direct rouble payment system with Bangladesh

It wants to settle repayment of a loan for building the Rooppur Nuclear Power Plant in roubles as Western sanctions hinder fund transfers

Published : 16 March 2023, 05:16 PM
Updated : 16 March 2023, 05:16 PM

Russia is seeking a direct payment system in roubles with Bangladesh to settle repayment of a loan for building a nuclear power plant as Western sanctions hinder fund transfers, a Bangladesh government official said on Thursday.

Bangladesh is constructing the first of two nuclear power plants in collaboration with Russia's state-owned atomic company Rosatom under a $12.65-billion project, 90% of which is financed through a Russian loan repayable within 28 years, with a 10-year grace period.

The project would help curb frequent power cuts which analysts expect to worsen this year as Bangladesh's ability to import fuels has taken a hit following a rapid decline in the value of its currency and foreign exchange reserves.

"Russia wants us to make payment in roubles, bypassing the normal global system," Uttam Kumar Karmaker, a senior official in the Economic Relations Division, told Reuters.

"Several rounds of virtual meetings were held in this regard but we did not come to any solution. We asked them to send a team to Bangladesh for further discussion," he added.

Dhaka has asked Moscow to ensure it uses non-sanctioned ships for delivering equipment for the nuclear plant, due to start operating in 2024.

Last month, Russia summoned the Bangladesh ambassador to protest Dhaka's decision to block port entry of dozens of Russian ships that have fallen under Western sanctions following Russia's invasion of Ukraine.