Ship gas to Bangladesh without worries, we can bring in payment guarantee facility: WB to global suppliers

The World Bank is asking global suppliers to ship gas to Bangladesh without any concerns as the multilateral lender believes its backing to the country is a kind of payment guarantee, said its Bangladesh and Bhutan Country Director Abdoulaye Seck.

"Gas will play a big role for Bangladesh. But the idea would be how we can bring in gas at a reasonable price. I mean the current price, for instance, that the United States pays when we say import of gas. What we will try to do is that the World Bank can bring a facility which is kind of a guarantee," he said at a discussion session titled 'Bangladesh-World Bank Relations: Way Forward', arranged by the Association of Former Ambassadors at Foreign Service Academy today (6 November).

"We tell suppliers: global suppliers, don't worry, you can ship your gas to Bangladesh. We will back Bangladesh. You will not have any concerns about being paid.  So it's kind of a guarantee. If this is done so, the import price of Bangladesh will really go down," he said in response to a question about the high gas prices being paid by Bangladesh.

On arrears to Adani 

Speaking about the ongoing issue of payment to the Adani Group, he said, "I see statements not only from the government but also from Adani. I think there are certainly a lot of facts and a lot of speculation. What is certainly clear is that there is a lot of pressure [from various sectors] right now on the government's ability..."

Abdoulaye Seck also said the World Bank team has met with the energy adviser.

The WB country director continued, "We'll be providing support to the country, to the budget that is backed by reforms in the areas of green growth and environmental sustainability. But also, we would like to support a number of other interventions.

Whether it is about the health sector, whether it is about addressing the flood. We are very confident that with strong economic fundamentals and the right policy adjustment, Bangladesh can return to a strong and sustainable growth path."

He also said the tragic events of July and August called for a renewed focus on bold and timely reforms. Those are important to address key economic challenges.

"In Washington, our senior management expressed its strongest commitment to the people of Bangladesh and particularly to youth."

On cenbank policy

However, he criticised the Bangladesh Bank's policy for the decline in forex reserves.

"I think the driver of this was a misguided policy by Bangladesh Bank that has tried to defend the exchange rate that was not sustainable. Why Bangladesh went from $40+ billion to now $19 billion or so? It's because Bangladesh Bank was defending this artificial action trade at the cost of $1 billion a month for almost two years… We really pushed very hard: don't do this. That is how in April Bangladesh Bank introduced this crawling peg and made an evaluation."