After evoking strong reactions, Dr. Manmohan Singh’s office has redacted his comments about Bangladesh from the official PMO website. Indian newspapers initially reported that the Indian High Commissioner to Bangladesh had been summoned to the Foreign Ministry to explain those comments, although both the Indian and Bangladeshi officials are denying that at present. It would be extremely out-of-character for the current government to make such a strong move over these comments; so we should probably, just this once, take Mijarul Quayes’s word for it.

While the “25% of Bangladeshis support Jamaat” portion grabbed the most interest, Dr. Singh’s comments about Indian aid to Bangladesh was also intriguing. Here is what he said:

And that is why we have been generous in dealing with Bangladesh. We are not a rich country. But we offered it a line of credit of one billion dollars, when Sheikh Hasina came here.

To Dr. Singh, one billion dollars in line of credit to Bangladesh seems extremely generous. Keep in mind, Bangladesh has not received a single of those billion dollars do far. Moreover, let’s compare India’s treatment of Bangladesh to its treatment of Afghanistan:

•$100 million grant
•$70 million grant to build the Zarang-Delaram Highway
•$200,000 to the World Bank’s Afghanistan Reconstruction Trust Fund
•$4 million grant to repair and build the Indira Gandhi Institute of Child Health in Kabul
•$4 million grant to build the Habibba School
•$52 million to the World Food Programme, for Afghanistan and Iraq
•$25 million to build the Afghan parliament in Kabul
•A gift of 3 Airbus airplanes to Ariana, the Afghan national carrier.

While these don’t add up to a billion dollars, keep in mind that the aid given to Afghanistan is through grants, which does not have to be repaid. The line of credit extended to Bangladesh, on the other hand, is credit, that must be paid back, with interest. Moreover, virtually almost all the credit has to be used to hire Indian firms and buy Indian goods.

How generous.

The Indian Foreign Minister, S. M. Krishna, is scheduled to visit Bangladesh soon, a point also mentioned by Manmohan in his comments. Yet, Krishna’s name figures high in the name of those who are expected to lose their jobs in the coming cabinet reshuffle. Intriguingly, part of the reason that Krishna may be fired comes from allegations of corruption regarding lines of credit extended by Indian to neighbouring countries, including Bangladesh:

The controversy (the [Ministry of External Affairs] has scarcely ever been dogged by the C-word) revolves around the award of contracts for projects and the line of credit, worth a few billions of rupees, extended to neighbouring countries, particularly Sri Lanka and Bangladesh, and in Africa. This is said to have led to the shifting out of joint secretary T.S. Tirumurti, who till recently headed the Bangladesh-Sri Lanka-Myanmar-Maldives division (commonly known as BSM)…

But soon enough, what had earlier just smelt fishy now began to toss up evidence of the actual corruption. A few days after [the construction of a housing project in Sri Lanka through an Indian line of credit] was given the green signal, senior officials from the other two public sector entities called the BSM enquiring whether the [Ministry] expected a cut from the project. When asked for reasons, PSU officials disclosed that a businessman, claiming to be close to [the Foreign Minister’s advisor], was demanding a cut. The BSM division promptly replied that its expectations were a “zero cut” from the housing project, and the businessman was asked to buzz off…

MEA officials counter that [a Joint Secretary was removed] because he would have insisted on stringent scrutiny of another line of credit pending in Bangladesh, where India is scheduled to build a railway line. (A line of credit is an MEA programme which has India finance a project in another country, with 85 per cent of it executed by Indian companies.)

Despite what Manmohan Singh may think, Bangladesh can get along perfectly well without his precious line of credit. And, if it turns out, that the money of Bangladeshi taxpayers is going to fuel corruption in India, then it would probably be better to cancel the line of credit altogether.

Now, how about sending some of that grant money our way?

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