Dhaka, Jan. 13 -- With around Tk 70 billion in loans remaining unpaid by state-run sugar mills for years, Sonali Bank has urged the government either to repay the money immediately or issue bonds or provide state-guarantees to ease the bank's classified-loan burden and capital shortage.

In a recent letter to Finance Division Secretary Dr Khairuzzaman Mozumder, Managing Director of Sonali Bank Shawkat Ali Khan wrote that the requirement to maintain higher provisions against unrealised loans has created direct and indirect pressure on the bank's business operations.

On various occasions, Tk 31.05 billion was disbursed as loans to the Bangladesh Sugar and Food Industries Corporation (BSFIC) and nine sugar mills. Due to the prolonged delays...