India flags off 2,200 tonnes of diesel to Bangladesh
Shipment to reach Dinajpur by railway tomorrow
Dharmendra Pradhan, minister (independent charge) for petroleum and natural gas of India, flags off a train carrying 2,200 tonnes of gasoil to Bangladesh from Siliguri, West Bengal, yesterday. The consignment will be received at Parbatipur by Nasrul Hamid, state minister for petroleum and natural gas of Bangladesh, and Harsh Vardhan Shringla, Indian high commissioner to Bangladesh, tomorrow. Photo: High Commission of India
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Business Report
Bangladesh is set to receive 2,200 tonnes of diesel from India tomorrow, further deepening energy cooperation between the two countries.
Dharmendra Pradhan, petroleum and natural gas minister of India, yesterday flagged off a train carrying the diesel from Siliguri of West Bengal as a “goodwill gesture” to Bangladesh, the Indian High Commission in Dhaka said in a statement.
Fifty wagons of Indian Railways are transporting the shipment, which will reach Parbatipur oil depot in Dinajpur on March 19 via Malda in West Bengal, covering a distance of 150 kilometres, said the Telegraph of India.
Nasrul Hamid, state minister for power, energy and mineral resources of Bangladesh, and Harsh Vardhan Shringla, high commissioner of India to Bangladesh, will receive the consignment at Parbatipur, according to the Indian High Commission and the power ministry of Bangladesh.
Energy cooperation has been growing between the two countries as they adopted a joint declaration during the Indian prime minister's visit to Bangladesh in 2015.
Numaligarh Refinery Ltd (NRL) of India, a subsidiary of state-run Bharat Petroleum Corporation, is supplying the gasoil.
Bangladesh Petroleum Corpora-tion or BPC will pay a premium of $7 per barrel to Bharat Petroleum, whereas it pays $4.5 to international suppliers, according to Mosleh Uddin, director of operations and planning at the BPC.
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From this consideration, the price will be higher.
But international suppliers are only liable to bring the petroleum products up to Chittagong Port, leaving the BPC to bear transport costs to distribute it to different parts of the country. That overall transport cost will go down if a significant amount of diesel could be supplied from Parbatipur, said Mosleh Uddin.
In April last year, Bangladesh and India agreed to install a 135-kilometre cross-border pipeline to help Dhaka import 10 lakh tonnes of diesel from India a year. NRL and BPC agreed to form a joint venture to set up the Indo-Bangla Friendship Pipeline from NRL's Siliguri marketing terminal in West Bengal to BPC's Parbatipur petroleum product storage depot.
It will take a couple of years to install the pipeline, reported the Telegraph.
When completed, the pipeline will help reduce the carrying cost of petroleum products. As a result, the cost of diesel to be imported from India will be less than what suppliers currently charge Bangladesh, BPC officials said earlier.
Only five kilometres of the pipeline will be on the Indian side and the rest on the Bangladesh side.
Bangladesh last imported diesel from India through river routes in 2007, but the amount was small. The import of petroleum products through river routes was stopped later on.
But discussions are underway to resume diesel import by water vessels until the pipeline is installed, said a BPC official last April. This is the first time petroleum products from India will be brought through the railways.
Bangladesh now imports petroleum products from around 10 countries, currently importing around 3.5 million tonnes a year to meet local demand.
India's north-eastern region has excess refining capacity of petroleum products, offering New Delhi an opportunity to export to neighbouring countries such as Myanmar, Bangladesh and Nepal, according to the Telegraph.
Dhaka now imports about 500 megawatts of electricity from India and is set to add another 100MW this month.