Rooppur power plant runs into further snag

GBDESK//

A fresh bout of uncertainty has emerged surrounding the completion of the Rooppur nuclear power plant after its engineering, procurement and construction (EPC) contractor was included in the latest round of sanctions by the US to squeeze Russia for its war in Ukraine.

The sanctions’ targets include JSC Nauchno-Issledovatelsky i Konstruktorsky Institut Montazhnoy Tekhnologii Atomstroy (NIKIMT), which was awarded the EPC contract for Bangladesh’s first nuclear power plant in 2015.

NIKIMT is a subsidiary of Russian state-owned nuclear power conglomerate Rosatom, which is building the $12.65 billion nuclear power plant in Iswardi, Pabna.

In a diplomatic note, the US embassy in Dhaka informed the ministry of foreign affairs of the sanctions ahead of going public on April 12.

“One entity included in this tranche of designations, NIKIMT Atomstroy JSC (a subsidiary of the State Atomic Energy Corporation Rosatom), has transacted with Bangladesh in the past. We look forward to continuing our discussion regarding ongoing and future transactions to support the Rooppur nuclear power plant,” the diplomatic note said.

The sanctions mean transactions with NIKIMT would run afoul of the US, Bangladesh’s single-largest export destination.

Contacted, the US embassy declined to disclose the content of the diplomatic note.

“Nonetheless, Russia’s brutal, unprovoked invasion of Ukraine is unacceptable. Many countries, including the US, are taking action to deter President Putin from continuing his war in Ukraine and have announced strong sanctions and export controls, presenting a united front against this aggression,” Sean J McIntosh, US Embassy Counsellor for Public Affairs, told The Daily Star.

Already, Bangladesh has run into difficulty servicing a $500 million loan taken in 2013 from Russia for the Rooppur project’s primary work following Western sanctions on Russian banks.

While a preliminary agreement was struck to service the stalled payments in Chinese currency, that modality is unlikely to progress after the latest sanctions.

But the stuck payments pose another problem for Bangladesh: risks of being classed as a defaulter of foreign loan.

Subsequently, the Economic Relations Division, the government wing responsible for handling foreign loans, has decided to open an escrow account with the Bangladesh Bank, officials informed the visiting staff mission of the International Monetary Fund yesterday.