Dhaka, May 5 -- Once-most-concessional loan is going to be costlier as Japan has proposed to raise its interest rate by 30-percentage points to 3.05 per cent for lending to Bangladesh, officials in Dhaka say.

Currently, Japanese lender Japan International Cooperation Agency (JICA) charges 2.35 per cent for its loans against different development projects in Bangladesh.

Even three years ago, the interest rate for the Japanese loan was less than 1.0 per cent, the officials said Monday.

"Japan has proposed the new rate of 3.05 per cent for the next loans, to be effective from April this year," a senior Economic Relations Division (ERD) official told the FE.

Not only the rate for the infrastructure-related project loans is going to be inc...