5 Lenders Arrange BDT 167 Crore for Bangladesh’s First EV Plant
5 banks and financial institutions are going to provide a syndicated loan of BDT 167 crore for Bangladesh’s first electric vehicle (EV) manufacturing plant of Bangladesh Auto Industries Ltd (BAIL). The proposed project’s cost is estimated to be BDT 335 crore. The remaining amount will come from equity and foreign direct investment.
Bangladesh Infrastructure Finance Fund Ltd (BIFFL) is the loan’s lead arranger. The others are Agrani Bank Ltd, Islami Bank Bangladesh Ltd, Bangladesh Development Bank Ltd and First Security Islami Bank Ltd. According to the BAIL, the BIFFL would contribute BDT 75 crore and the banks the BDT 92 crore.
Talking to the Daily Star, Anower Sadat, head of investment of the BIFFL, said they were going forward as their assessment showed that electric vehicles would dominate the future automobile market. He said:
“We do analysis of loan proposals on whether the business is viable or not before approving loans against any project.”
A financing agreement between the BAIL and the financers is already signed. BAIL has almost completed setting up the factory on 100 acres of land at Bangabandhu Sheikh Mujib Shilpa Nagar, Chattogram. Mir Masud Kabir, Managing Director of the BAIL, hopes to go for commercial operations within next month and for products to hit the market by June or July of 2022.
A Mannan Khan, Chairman of BAIL, said their target was to provide sedans and SUVs at reasonable prices to the middle and lower-middle income groups. He said:
“In our country, the lower middle and middle class dream of buying vehicles but they cannot afford it as the prices are excessive. Considering their purchasing capacity, BAIL will provide them vehicles at affordable prices in semi urban and rural areas.”
The company is expecting to sell an SUV at BDT 25 lac, sedan at BDT 12 lac to up to BDT 15 lac and a hatchback at BDT 8 lac or even less. Khan said electric vehicles would cut fuel cost by 90% and per kilometer energy cost would be less than 2 Taka. The battery capacity will be 50 kilowatt hour. Fully charging an EV would cost 400 Taka as per the existing electricity tariff. According to Mannan Khan:
“With a 20 minute charge, our EVs can run 400 km and can be charged at home with a regular connection or at a quick charging station. Our EV will also reduce maintenance costs by 90% and carbon emission and toxic gasses by 100% while ensuring the better transport performance and road safety.”
In addition to 4-wheelers, BAIL will also manufacture 2-wheelers and 3-wheelers and has plans to upgrade to commercial pickups, mini-trucks and multipurpose vehicles. Khan expects the company’s annual car sales to reach two lac units by 2025 and 10 lac units within the next 10 years.