The proposed plant at Khulna will run on imported coal with capacity of 1,320 megawatt (MW), with two units to be built each of 660MW.

Industry sources said Bhel had emerged as the lowest bidder. The decision on awarding the project will be taken by the end of March. It will be the company's biggest overseas power contract.

The tender was floated by Bangladesh India Friendship Power Company, a 50:50 joint venture between NTPC and the Bangladesh Power Development Board.

Bhel has outbid Larsen & Toubro and China's Harbin Electric International Company, which has power facilities in Iran, Turkey and Indonesia, to emerge as the lowest bidder for the "Maitree" (friendship) project.

Initially, the joint venture wanted to allow companies having a 500MW overseas operational unit to bid. In that case, Bhel would have been disqualified. However, the condition was removed later as NTPC did not agree with the condition. It wanted Bhel to bid for the power plant.

The cabinet in September allowed Exim Bank to offer concessional finance to support such companies bidding for strategically important infrastructure projects abroad.

Exim Bank backed Bhel's offer with nearly 70 per cent funding of the costs at an interest rate of around 1 per cent above Libor (London Interbank Offered Rate).

India and China are in the fray for world's resources as they seek to fuel economic growth. India's efforts to step up energy diplomacy by engaging with Myanmar, Bangladesh and Sri Lanka have not yet yielded any desired results.

China is becoming increasingly influential by wielding its growing economic might without being constrained by the need to consider its own local constituents.

The terms and conditions for bidding was seen as an aggressive attempt by Beijing to win the Bangladesh contract.

Meanwhile, Bhel has commissioned a 500MW unit at Anpara-D thermal power plant in Uttar Pradesh.