AIS Marine & Offshore Pty Ltd, Australia has made two offers to supply six new container vessels for Bangladesh Shipping Corporation (BSC).
In the first proposal, AIS Marine wants to provide a $300 million low-interest loan while the second proposal is to supply the ships under Public-Private Partnership (PPP) model.
The BSC has sent letters to the Finance Division, Finance Ministry, Economic Relations Department, and Bangladesh Investment Development Authority seeking their clearance regarding the proposal.
If the project is successful, there is a possibility of getting a $700 million loan later to purchase new ships, according to sources from the Shipping Ministry.
In the first proposal, the Australian company wants to provide the loan for a 25-year term at approximately 0.55 percent interest per annum for the supply of container ships. There will be no hidden fees and down payment, and loan repayment would begin three years after delivery of the ship.
Notable, the terms of interest rate, loan tenure, security deposit, and grace period can be revised through negotiation with AIS Marine.
As per the second proposal, BSC will directly enter into a conventional loan agreement with financial institutions
to finance the project under capital works loan.
In this case, AIS Marine will introduce the BSC to a funding provider and the BSC will discuss the terms of the loan directly with them.
A non-binding MoU has already been signed between BSC and AIS Marine in the presence of the secretary to the shipping ministry.
BSC Managing Director Commodore SM Moniruzzaman said, “The Finance Ministry has instructed that BSC should take efforts to collect loans of a flexible nature through the Economic Relations Department if there is a need to take a loan for the purpose of implementing any project of public importance.”
He said, “There is an instruction that BSC has to get policy consent from the finance division through the finance ministry before processing the loan if a state guarantee or counter-guarantee is required for taking this loan. The instruction is applicable to taking loans of both flexible and rigid nature.”
“Therefore letter has been sent to the Finance Division and the Economic Relations Division seeking approval to process the loan from AIS Marine,” he added.
In the early 1980s, BSC had a total of 28 ships in its fleet which was later increased to 44.
After selling 36 ships at different times as those were considered old, obsolete, and commercially unprofitable, the corporation currently has only 8 ships. If the new six ships are added, the BSC will have 14 ships in total.