Sheikh Hasina's India visit: PM Modi offers $5-billion credit to Bangladesh

Amount includes $500 million earmarked for purchasing defence equipment from India

India on Saturday announced an additional $4.5-billion concessional line of credit for implementation of projects in Bangladesh, and another $500 million for Dhaka to procure defence equipment from New Delhi.

Apart from the funds and 22 agreements signed between the two countries, some more agreements would be signed on Monday, by the Indian private sector. This would result in investment of over $9 billion in Bangladesh, a joint statement issued by the two nations said.

But more than the funds, Prime Minister Narendra Modi lauded his Bangladesh counterpart Sheikh Hasina, on a visit to India, for her zero-tolerance towards terrorism. He praised the efforts of her government to rein in radical elements in the neighbouring country that have been a cause of concern for India as well.

Aware of the pressure that Hasina faced domestically on the issue, the PM came close to admitting that New Delhi has been unable to keep its side of the bargain by failing to deliver on the much-awaited bilateral agreement to share the waters of the Teesta.

At the joint press interaction, Modi said while the two sides successfully concluded the land-boundary agreement, the much-awaited Teesta water-sharing agreement had “attracted the greatest attention.” Speaking as much to the people of Bangladesh, the Indian PM said Teesta was “important for India, for Bangladesh and for India-Bangladesh relationship.”

With West Bengal Chief Minister Mamata Banerjee, who in 2011 had derailed the signing of the Teesta water-sharing agreement, also present, Modi said “her feelings for Bangladesh are as warm as my own.” 

“I assure you and the people of Bangladesh of our commitment and continuing efforts. I firmly believe that it is only my government and ...your (Hasina’s) government, that can and will find an early solution to Teesta water sharing,” the PM said. 

Like Modi, Hasina faces an election in 2019. The Indian PM could visit Dhaka in these two years, and the agreement, being negotiated for over two decades, might finally be inked.

Modi also spoke on the agreement on greater defence cooperation between the two countries. He said by extending the $500-million line of credit to support Bangladesh’s defence-related procurement, India would be guided by Bangladesh’s needs and priorities. 

The PM said the new $4.5-billion line of credit for projects in Bangladesh will bring India’s resource allocation to its neighbouring country to a little more than $8 billion over the past six years. In October last year, Chinese President Xi Jinping had visited Dhaka and committed investment of $20 billion in infrastructure projects in Bangladesh.

Hasina, on a four-day visit, arrived on Friday. She was accorded a ceremonial reception in the morning, and will visit Ajmer on Sunday.

On Saturday morning, India and Bangladesh signed 22 agreements to boost cooperation in a wide array of sectors, including setting up more border haats (temporary markets). India would also train 1,500 judicial officers from Bangladesh. India had recently trained 1,500 Bangladeshi civil servants.

Modi also noted that India has added an additional 60 Mw of power to the 600 Mw already flowing to Bangladesh. “The supply of another 500 Mw has already been committed from the existing connection,” he said. Another 1,000 MW will be offered to Bangladesh once additional interconnection points come up. Hasina requested Modi that India review its recent imposition of anti-dumping duties on export of jute from Bangladesh. The Indian PM thanked his Bangladeshi counterpart for assigning an area of 1,005 acres at Mirsharai for setting up an Indian SEZ (special economic zone). India has also agreed to finance a diesel oil pipeline from Numaligarh Refinery in Assam to Parbatipur in Bangladesh. Till the work of the pipeline was completed, high-speed diesel would be supplied by a rail link. The two PMs flagged off, via videoconferencing, the inaugural consignment of 2,200 metric tonnes from Numaligarh. 

Modi said several agreements for investments in the energy sector of Bangladesh are expected to be signed by the Indian companies in the coming days.

The two sides have also restored bus and train links between Kolkata and Khulna, and Radhikapur and Biral. The two nations agreed to optimise inland waterways and take steps to put in place a coastal shipping agreement.

At an event to honour 1,661 Indian soldiers who sacrificed their lives during the 1971 war for Bangladesh’s independence, Modi announced that India would offer free medical treatment to freedom fighters of the Bangladesh Liberation War and scholarships to their children. 

He also attacked Pakistan, and said some South Asian nations were opposed to development in India and Bangladesh. He added that this attitude nurtured terrorism.

The Bangladeshi PM told reporters New Delhi had agreed to support Bangladesh’s efforts to obtain international recognition for the “Genocide of 1971”.

At home, however, Hasina faced criticism from the opposition. Bangladesh Nationalist Party’s General Mirza Fakhrul Islam Alamgir said Hasina had failed to address key issues, including sharing of water from 54 common rivers, stopping of border killings and reducing the bilateral trade gap.

At the ceremony to sign agreements, there was much mirth between Modi and Hasina when the announcer asked the two of them to step off the elevated podium. “May I now request the two PMs to please step down?” he said, to which both Modi and Hasina couldn’t stop laughing.