Dhaka, July 27: In what is being seen as a landmark deal between once bickering neighbours, Bangladesh has signed a 35-year power transmission agreement with India to import 250 megawatt of electricity from late 2012.
Representatives of the Power Grid Corporation of India Ltd (PGCIL) and Bangladesh Power Development Board (BPDB) signed the deal late Monday evening, The Daily Star newspaper reported.
Describing it as "a landmark deal", it said top ministers and officials of the Bangladesh government witnessed the ceremony.
This deal has taken place following Prime Minister Sheikh Hasina's New Delhi visit in January when India pledged to help Bangladesh with infrastructure, trade, connectivity and a soft loan of $1 billion.
The agreement keeps the provision for Bangladesh to export power to India in the future, and the transmission system will have the capacity to exchange 500 MW of power soon after the system is launched.
"This is a small step for Bangladesh and India, but a giant leap for regional cooperation," said Hasina's energy adviser Tawfiq-e-Elahi Chowdhury.
Bangladesh Finance Minister A.M.A. Muhith termed the signing as "a dream of regional cooperation coming true", and lauded the fast pace of reaching the agreement. "I hope the pace will continue in implementing the project," he added.
PGCIL director Arun Kumar and BPDB secretary Azizul Islam signed the agreement.
According to the agreement, PGCIL will invest and construct 80 km of transmission line and own, operate and maintain it. The Indian company will recover the construction cost under a fixed rate over 35 years.
BPDB officials said PGCIL will incur a cost of about Rs.80 crores (about $17 million).