Summit Meghnaghat Power Company Limited completed repayment of its $190 million syndicated foreign loan by October 15. The repayment closed a decade-long financing cycle that demonstrates how Muhammed Aziz Khan’s 2016 decision to establish Summit Power International in Singapore enabled access to competitive international capital.
DEG, acting as agent for the lending consortium, confirmed on October 30 that Summit Meghnaghat Power Company “complied with its obligations to the satisfaction of the DFI Facility Lenders.” The consortium included Standard Chartered Bank, DEG Germany, FMO Netherlands, the OPEC Fund for International Development, British International Investment, and Bangladesh’s Infrastructure Development Company Limited.
Khan stated the achievement reflects broader capabilities. “This successful repayment reflects Summit’s unwavering commitment to transparency, operational excellence, and responsible partnership with international lenders,” he said:
“It also demonstrates Bangladesh’s growing capacity to manage large-scale, internationally financed projects with integrity and professionalism.”
Singapore Incorporation Reduced Borrowing Costs
Khan’s 2016 decision to incorporate Summit Power International in Singapore fundamentally reshaped the company’s financing capacity. Bangladesh’s domestic borrowing rates hover around 14 percent, driving up the weighted average cost of capital and forcing higher electricity tariffs. Through Singapore, Summit Group secured loans at interest rates substantially below domestic alternatives, making long-term projects viable without inflating consumer prices.
“If the cost of debt is 14%, the weighted average cost of capital (WACC) could increase to as high as 18-19%,” explains Wu Yan Bin, Deputy CEO / chief financial officer at Summit Power International. “The cost of equity may need to be around the mid-twenties for it to be attractive to any investor. If your equity IRR is in the mid-twenties, it’s simple economics, your tariff needs to be high.”
The 337-megawatt dual-fuel Summit Meghnaghat Combined-Cycle Power Plant secured its $190 million financing package with a 14-year tenure aligned to its power purchase agreement. This reduced capital cost kept tariffs competitive and ensured timely repayments throughout the plant’s operating life. The Singapore entity also broadened Summit Group’s lender base and enabled access to longer-term credit unavailable in Bangladesh’s banking system, where short-term deposits and regulatory constraints limit infrastructure lending.
IFC Partnership and Governance Framework
The International Finance Corporation played a central role in establishing the Singapore structure. In 2016, the IFC invested $175.5 million in Summit Power International alongside IFC Asset Management Company and EMA Power, a joint venture between Daelim Energy and the Islamic Development Bank Infrastructure Fund II.
“The IFC facilitated the incorporation of a Singapore entity and invested in the structure, which enabled the Singapore entity to invest back into Bangladesh,” said Ayesha Khan, managing director and CEO of Summit Power International.
Participation by development finance institutions introduced governance disciplines uncommon in emerging-market projects. These include technical milestone verification before contractor payments and audited financial statements before dividend remittances. Each cross-border transaction undergoes Bangladesh Bank approval, ensuring transparency and compliance with debt covenants.
Ayesha Khan explained the structural requirements. “What Bangladesh has is a lot of opportunities and a lot of growth,” she said.
“But what it lacks is governance and a mature financial market, both of which are very much necessary to complete long-term infrastructure projects.”
Expanding Bangladesh’s Power Access
When Summit Group built its first independent power plant in 1998, approximately 20% of Bangladesh’s population had access to grid electricity. The company now operates 14 plants with combined capacity exceeding 2,000 megawatts, making it Bangladesh’s largest independent power producer.
Foreign capital injections ease pressure on Bangladesh’s domestic banking system, which faces structural constraints in providing long-term infrastructure financing. Summit Group noted that securing foreign financing “injected valuable foreign capital into the national economy, helping to ease pressure on local banks and supporting overall macroeconomic stability.”
Muhammed Aziz Khan’s philosophy connects business operations with social outcomes. “The creation of wealth should not be only for personal gain and pleasure, but also for the improvement of humanity,” he said.
A Framework for Emerging-Market Infrastructure Finance
The completed Meghnaghat loan cycle demonstrates how offshore corporate structures can lower infrastructure costs for developing economies. Khan’s Singapore incorporation strategy initially faced questions about whether a Bangladeshi company required offshore establishment. The on-schedule debt repayment after a decade of operations provides empirical validation—Summit Group delivered electricity to Bangladesh’s national grid at competitive rates while generating sufficient cash flow to satisfy international lenders’ debt service requirements.
“It is a complicated process to understand the steps we have taken to attract financing and why it is necessary to attract financing at a competitive rate,” said Ayesha Khan.
“I’m not saying it is impossible to attract financing sitting in Bangladesh, but the cost of borrowing becomes much higher.”
Summit Group’s approach combines domestic operational expertise with offshore financial architecture, enabling technology deployment and price competitiveness that purely domestic financing approaches could not achieve. The company’s experience suggests that infrastructure development in economies with constrained financial markets may require corporate structures capable of accessing international capital markets. Under Khan’s direction, Summit Group continues demonstrating how international financing and local execution can work together to support development objectives.
