India extends $4.5 bn line of credit to Bangladesh

India has extended a $4.5 billion line of credit to Bangladesh even as the two countries today signed about 25 agreements to increase cooperation in various fields, including nuclear power and defence.

Prime Minister Narendra Modi welcoming the Bangladesh's Prime Minister Sheikh Hasina at a ceremonial reception at Rashtrapati Bhavan, in New Delhi on 8 April 2017

During talks between Prime Minister Narendra Modi and visiting Bangladesh Prime Minister Sheikh Hasina, India also commits $500 mn credit to Bangladesh military.

''I am happy to announce a new concessional line of credit of $4.5 billion for the implementation of projects in priority sectors for Bangladesh, Prime Minister Narendra Modi said. ''This brings our resource allocation for Bangladesh to more than 8 billion dollars over the past six years,'' he added.

''Energy security is an important dimension of our development partnership and our energy partnership continues to grow. Today, we added an additional 60 Mega Watt of power to the 600 Mega Watt of power already flowing from India to Bangladesh. The supply of another 500 Mega Watt has already been committed from the existing inter-connection. We have also agreed to finance the diesel oil pipeline from Numaligarh to Parbatipur.

''Our companies are entering into a long-term agreement for the supply of high speed diesel to Bangladesh. We have also agreed on a time table for regular supply till the pipeline is constructed. We are encouraging private sectors in both our countries to enter this space. Several agreements for investments in the energy sector in Bangladesh are expected to be signed by the Indian companies in the coming days, Modi said.

He said India will continue to be a willing partner in meeting the energy needs of Bangladesh, and its goal of achieving 'Power for all by 2021'.

Both the leaders jointly launched new rail and bus services between India and Bangladesh and restored an old rail link between the two South Asian neighbours following bilateral talks here.

The two prime ministers launched the Maitree Express train that will run between Kolkata and Khulna in Bangladesh and bus services between Kolkata and Dhaka via Khulna.

The two leaders also restored a once-defunct rail link between Radhikapur in north Bengal and Biral in Bangladesh and flagged off a cargo consignment of high speed diesel from Numaligarh Refinery in Assam.

However, the much-delayed pact on the Teesta water sharing remained elusive for the two sides. Admitting that the pact was "important" for India-Bangladesh ties, Modi assured India's commitment to the issue.

He said an "early solution can and will be found" to the Teesta water sharing issue.

Connectivity is crucial for the success of bilateral development partnership, sub-regional economic projects and for the larger regional economic prosperity.