In the last few years, Bangladesh has made remarkable progress. Every Indian is proud of that & we’re delighted that we’ve been able to contribute to this development journey of Bangladesh,” PM Modi said in his address at the virtual event.
“I am confident that this pipeline will further accelerate the development of Bangladesh, and will be an excellent example of increasing connectivity between the two countries,” he added.
The two PMs had joined the groundbreaking ceremony for the pipeline in September 2018.
The newly inaugurated pipeline stretches 125km inside Bangladesh’s territory and 5km inside India and is significant due to the following reasons:
First cross-border energy pipeline
·This is the first cross-border energy pipeline between India and Bangladesh which Delhi would use. The Pipeline has been built from approximately Rs 3.46 billion, drawn from the Indian Line of Credit (LoC), to export diesel to Dhaka and Bangladesh Petroleum Corporation officials.
Cost and capacity
It has been built at an estimated cost of Rs 377 crore. The Bangladesh portion of the pipeline has been built at a cost of approximately Rs 285 crore, which has been borne by the Indian government under grant assistance.
·The pipeline has a capacity to transport 1 million metric tonnes per annum (MMTPA) of diesel, which will be initially supplied to seven districts of northern Bangladesh.
Hope in the time of crisis
Bangladesh imports the bulk of the fuel it needs for electricity.
High global prices forced Bangladesh to slash its imports in 2022 despite a rise in power demand, resulting in a fuel shortage that forced millions of citizens into hours of darkness every week during the second half of last year.
·Temperatures typically start increasing from the end of March, and BIPPA estimates power producers to require 2.12 million tonnes of fuel oil in the four months to June 2023.
Initially, Bangladesh would buy some 2.5 lakh tonnes of diesel. It would then be increased up to 4 to 5 lakh tonnes in the following years.
It costs around USD 8 for each barrel of fuel to be transported from the port city. The pipeline would reduce the cost to around USD 5 per barrel. It will also reduce the transportation time to just one hour as opposed to the current situation of taking several days to transport diesel via wagons and trawlers
Fast delivery at minimum cost
India-Bangladesh Friendship Pipeline would help provide a stable supply of diesel in all 16 northern districts under Rangpur and Rajshahi in Bangladesh.
It will ensure fast-paced delivery of fuel at a minimum cost. Currently, imported diesel are supplied to these regions via wagons and trawlers from the Chattogram and Mongla ports.