Narendra Modi and Sheikh Hasina inaugurate Rs 377 Crore diesel pipeline in Bangladesh

The pipeline will open a new chapter in India-Bangladesh relations, Modi said at the inauguration.

Currently, diesel is supplied to Bangladesh through a 512 km railway. The 131.5 km pipeline will deliver up to 1 million tonnes per year of diesel from Numaligarh in Assam to Bangladesh.

This would not only save transportation costs, but also reduce the carbon footprint of moving fuel, Modi said.

“This pipeline is particularly important in the context where many developing countries are struggling with fertilizer and energy security,” he said.

Construction of the pipeline project began in 2018. It is the first cross-border energy pipeline between the two neighbors. Out of the total Rs 377 crore cost of the project, Rs 285 crore of the Bangladeshi section of the pipeline was covered by the Indian government through grant aid.

The foundation stone of this pipeline was laid by the two prime ministers in September 2018. Numaligarh Refinery Limited has been supplying petroleum products to Bangladesh since 2015.

The Prime Minister thanked Hasina for her constant guidance on the project and expressed his wish to continue working with her for the benefit of the peoples of both countries.

He said work on the pipeline has continued despite the pandemic and will help reduce transportation costs. In addition, the carbon footprint of this supply will be lower than that of the alternative mode.

“A reliable and sustainable supply of diesel will benefit the agricultural sector. Industries will also benefit,” he said. “The pipeline will help accelerate the development of Bangladesh and be an excellent example of increasing connectivity between the two countries.” It is important that all pillars of connectivity, whether transport, energy, grid or digital, are strengthened, he said. Increased connectivity will facilitate people-to-people contacts.

Modi said that during the Covid pandemic, rail connectivity has helped India deliver oxygen and other essentials to Bangladesh.

In the energy sector, cooperation between two nations is very fruitful. “Today, India is supplying over 1,100MW of electricity to Bangladesh,” he said.

In addition, the first unit of the 2×660 MW Maitree thermal power project in Bagerhat district of Khulna Division in Bangladesh has started up and the second unit is also expected to start up soon, he said.

The project was developed under India’s concessional finance scheme. It is built by Bharat Heavy Electricals Ltd (BHEL) for Bangladesh-India Friendship Power Company Pvt Ltd. The first 660 MW unit was commissioned in October last year and the second unit of similar capacity will soon be commissioned.

“Our oil trade has exceeded $1 billion,” he said, referring to the energy trade between the two nations.

Hydrocarbon cooperation between the two nations spans the entire value chain – from upstream oil and gas exploration to midstream and downstream transportation. “This pipeline will further strengthen that cooperation,” he said.

Bangladesh is India’s largest development partner and largest trading partner in the region. The operationalization of the Friendship Pipeline will strengthen the ongoing energy cooperation between the two countries and promote growth in Bangladesh, especially in the agricultural sector.

The India-Bangladesh Friendship Pipeline (IBFPL) will transport 1 million tonnes per annum (MMTPA) of diesel to seven districts in northern Bangladesh.

The pipeline will run from the Siliguri-based marketing terminal of Numaligarh Refinery Limited (NRL) to the Parbatipur depot of Bangladesh Petroleum Corporation (BPC). The fuel transport agreement between the two countries will be in effect for 15 years with an option to extend during later phases on the agreement of the two countries.

India and Bangladesh have grown closer in their relations, with Bangladesh rapidly becoming India’s largest trading partner in South Asia.

The country is the fourth largest market for Indian exports in the world, with exports worth $16 billion. The two countries are currently in the process of formulating a Comprehensive Economic Partnership Agreement (CEPA), which could see India’s exports to the country double to $32 billion in the near term.