India will build two power plants in Bangladesh

US$1.7 billion deal to ease a Bangladesh’s huge electricity shortage.

The deal with India will build two coal-fired power that will have a total daily generating capacity of 1,320 megawatts. The plants will be constructed by Dhaka's Power Development Board and India's National Thermal Power Corp and will become operational in three years.

The two state-owned companies will share the cost of building the plants, which will be managed by the Indian company and will use imported coal.

Officials from both countries signed the agreement in Dhaka last week. A four-month feasibility study will be carried out before construction starts in July.

Bangladesh has long suffered severe power outages due to demands imposed by its fast-growing economy. The power shortfall is especially acute in the hot summer months from April to October.

Some 40% of Bangladesh's 144 million people have power while peak-time shortages force some factories to halt production.