Bangladesh gets Russia loans for weapons, nuclear plant

MOSCOW Tue Jan 15, 2013 10:42pm IST

Russian President Vladimir Putin (R) shakes hands with Bangladesh Prime Minister Sheikh Hasina during their meeting in Moscow's Kremlin January 15, 2013. REUTERS/Mikhail Metzel/Pool

Russian President Vladimir Putin (R) shakes hands with Bangladesh Prime Minister Sheikh Hasina during their meeting in Moscow's Kremlin January 15, 2013.

Credit: Reuters/Mikhail Metzel/Pool

MOSCOW (Reuters) - Russia on Tuesday granted Bangladesh a $1 billion loan for weapons purchases and $500 million to help one of Asia's poorest countries build its first nuclear power plant, Russian President Vladimir Putin said.

Putin moved to strengthen Russia's presence in the South Asian nation, overseeing the signing of the deals signed in the Kremlin after holding talks with Bangladesh's Prime Minister Sheikh Hasina.

Russia is the world's second-largest weapons exporter and is building or seeking to build or upgrade nuclear power plants in several countries in Asia, the Middle East and Europe.

"Our countries intend to broaden military-technical cooperation," Putin said in a joint appearance with Sheikh Hasina after talks, referring to weapons sales and servicing.

He did not specify what weapons or military equipment Bangladesh would buy from Russia with the loan money.

Russian financial daily Vedomosti, citing an unnamed source, reported on Tuesday that Bangladesh planned to buy weapons and armoured vehicles for ground forces as well as surface-to-air missile systems and Mi-17 transport helicopters.

Bangladesh is one of several nations pushing ahead with plans to introduce nuclear power despite concerns raised by the accident at Japan's Fukushima plant in March 2011.

Bangladesh's demand for fuel is growing sharply as a shortfall of natural gas has forced it to turn to costly oil-fired power plants to resolve crippling electricity shortages.

Russia signed a framework deal on cooperation in peaceful nuclear power generation in 2010 and an agreement to help build Bangladesh's first nuclear power plant at Ruppur.

"We will not only provide the most up-to-date technology ... but we will also provide financial support for the construction of the nuclear power plant at the initial stage," Putin said after the $500 million loan deal was signed.

The head of Russian state nuclear corporation Rosatom, Sergei Kiriyenko, said technical and environmental assessments would be carried out this year for the plant, which is to have two 1,000-megawatt reactors and be completed in the early 2020s.

He told reporters more loans would be required at later stages.

(Additional reporting by Gabriela Baczynska; writing by Steve Gutterman; editing by Jason Neely)

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