Russia rejects deadline extension for RNPP loan repayment
Staff Reporter :
The newly appointed Russian Ambassador to Dhaka, Alexander G. Khozin, has expressed optimism about resolving the payment issues surrounding the Rooppur Nuclear Power Plant (RNPP) project.
During a meeting with Foreign Affairs Adviser Md Touhid Hossain, Ambassador Khozin reaffirmed his commitment to strengthening bilateral relations. He also held discussions with Foreign Secretary Md Jasim Uddin at the Ministry of Foreign Affairs on Sunday, focusing on various bilateral matters between the two countries.
Speaking to reporters after the meeting, Khozin assured that technical teams are actively working to address the payment complications. “It will be resolved soon,” he said, adding that both nations remain optimistic about using local currency and maintaining positive relations. He also stated that the project is expected to be completed on schedule.
In 2016, Bangladesh agreed to borrow approximately $13 billion from Russia to finance the construction of the Rooppur Nuclear Power Plant. As part of the agreement, Bangladesh was required to make interest payments and an advance payment of 10 per cent.
However, payment difficulties arose following the imposition of US sanctions on Russia due to the conflict in Ukraine.
These sanctions have severely disrupted financial transactions involving Russian banks, with at least ten institutions barred from using the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system, a key gateway for international payments.
The loan, totalling $12.65 billion, carries a maximum interest rate of 4 per cent, with an additional penalty rate of 2.4 per cent for overdue payments.
On 21 August last year, the Russian financial institution VEB.RF, representing the Russian government, sent a letter to Bangladesh’s Economic Relations Division (ERD), requesting that outstanding payments of $480 million (covering the period from 15 March 2022 to 15 March 2024) and $150 million in interest (for the period from 16 March to 15 September 2024) be settled in US dollars or Chinese yuan and deposited into the Bank of China’s Shanghai branch.
Bangladesh was also required to pay a commitment fee of $750,000.
Efforts to resolve these issues have been ongoing.
A meeting on 2 September last year involved representatives from various government agencies to discuss the matter. Meanwhile, the principal loan repayment is scheduled to begin on 15 March 2027.
Bangladesh’s interim government, led by Muhammad Yunus, proposed extending this deadline to 15 March 2029, but Russia declined the request for deferment.
Ambassador Khozin also highlighted Russia’s commitment to fostering cooperation with Bangladesh across various sectors. He revealed Russia’s interest in recruiting Bangladeshi workers for its agriculture and shipbuilding industries and stressed the importance of formal discussions and agreements before initiating such collaborations.
The ambassador further expressed Russia’s willingness to simplify visa procedures for Bangladeshi citizens to strengthen people-to-people connections and facilitate the mobility of skilled workers.
In his discussions, Khozin reiterated Russia’s commitment to expanding trade and investment ties with Bangladesh, identifying energy, agriculture, and technology as key areas for collaboration.