Dhaka: India on Sunday announced that it will write off USD 200 million of the USD 1 billion line of credit offered to Bangladesh, and promised to implement all bilateral agreements, including those that have witnessed delays.
India had announced a USD 1 billion Line of Credit to Bangladesh, the largest it has offered to any country in 2010.
Finance Minister Pranab Mukherjee said on Sunday that New Delhi had decided to consider USD 200 million of that amount as a grant rather than credit, and Bangladesh can utilise the fund for its priority projects.
"India will treat the amount as grant, not credit," Mukherjee told a group of senior editors as he wound up a 20-hour trip to Dhaka.
"This USD 200 million will be utilised for projects that Bangladesh prioritises," he said.
The rest USD 800 million will bear a one per cent interest, instead of previously announced 1.75 percent, according to bdnews24.
Mukherjee also cited "ground realities" of coalition politics as the reason for India's failure to seal the Teesta water sharing deal during Prime Minister Manmohan Singh's visit to Bangladesh last year.
"In a democracy such as ours... this process often becomes time consuming," he said.
"There are certain issues that need to be resolved," he said while referring to the Teesta issue as a "sensitive" one.
Earlier, during his meeting with Premier Sheikh Hasina, Mukherjee vowed to implement all agreements signed with the country during Manmohan Singh's visit last year.
"Although it was late, (all) these agreements (signed with Bangladesh) will be materialised soon," he was quoted as telling Hasina by a Prime Minister's office spokesman.


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