The Summit Industrial Mercantile Corporation and Associates, which operates the Khulna barge-mount power plant, will pump $22m into the 450mw project and the PDB will provide land and related infrastructure.

The bulk of the investment will however come from the World Bank, Asian Development Bank, Islamic Development Bank and the British donor, CDC.

"This power plant will be set up on build, own, operate (BOO) basis," said State Minister for Power Iqbal Hasan Mahmud. "This is the first joint venture between the government and a private company in the power sector."

Shares of the Sirajganj plant, planned to put in operation by 2007, will also be floated in the market, he said.

On June 14 last year, the PDB picked the lone bidder Summit for the project considering its power tariff offer of 2.7895 cents/ kilowatt hour for a period of 22 years. Summit also offered $2.4 rate for per unit gas.

This bid suggested that the PDB would hold 40 percent equity of the project by providing land for the power plant. PDB held only 10 percent equity in both Meghnaghat and Haripur projects.

Yesterday's meeting also approved a Tk 70 crore suppliers credit project to set up radio link and a digital telephone exchange in the Chittagong Hill Tracts. A Chinese company will install this system.

The committee however turned down two other projects -- a 300-meter cable bridge on the Surma river and a 'Health Bhaban' in Mohakhali at a cost of Tk 51 crore.

The committee felt construction of such building was unnecessary.