Japan has moved to lessen procedural delays in channelling funds to Bangladesh to expedite project implementation, officials said.
The initiative has been taken as complex procedures for opening bank accounts have been causing delays in sending funds for project implementation.
The Embassy of Japan in Dhaka has sought the government’s consent to open a single bank account to manage funds for multiple projects.
In a letter to the Economic Relations Divisions (ERD), Machida Tatsuya, a minister and deputy chief of mission, wrote that Japan is reviewing its overall system to carry out development cooperation “more effectively and efficiently” in line with an approval given by its cabinet in June last.
Under the existing system, he said the government of Bangladesh is required to open a separate bank account for each project in a bank located in Japan to receive the grant.
However, this process can be time-consuming, causing unwanted delays in project implementation.
With the new procedures, the government of Bangladesh will no longer need to open separate bank accounts for each project.
Instead, a single bank account, namely ‘Grant Aid Projects Account’, will be opened in a Japanese bank to manage funds for multiple projects.
“This will avoid the complex procedures for opening a bank account, which has caused delaying project implementation, and will lead to a significant shortening of the period from the conclusion of the exchange of notes to the start of the project, thereby speeding up project implementation,” Machida Tatsuya mentioned in the letter.
The letter further said that if the government of Bangladesh agrees with the proposal, the ‘Grant Aid Project Account’ method will be introduced next year.
The island nation has also requested that an official of the embassy of Bangladesh in Tokyo be given authority to sign bank arrangements and authorisation to pay on behalf of the government to open such a bank account.
This will help save time in terms of identification needed for opening a bank account in a Japanese bank, the letter mentioned.
A senior official at the ERD told The Financial Express that Japan provides a handsome amount of money as grant aid every year, under which scores of projects are being implemented.
“If all these funds can be received in one bank account instead of separate bank accounts for each project, the funds can be transferred just after the exchange of notes and project implementation can be started immediately,” he said.
The official said the ERD has sought opinions from the Finance Division and the central bank before replying to the embassy of Japan.
Source: https://newnation.live/japan-seeks-faster-fund-flow-to-expedite-project-execution-in-bd/
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