Awami govt set to destroy backbone of Bangladesh economy

[TopCat]

Largest shoe plant in the making

A $110 million shoe factory is being set up at the Korean Export Processing Zone (KEPZ), with remarkable progress in infrastructure development in the last two years.

Karnaphuli Shoe Industries Ltd, a company of Korea-based Youngone Group, will be the largest in Bangladesh with a monthly production capacity of 30 million pairs. Sixteen buildings are being built on two adjoining hills to house the factory.

The factory will provide employment for 32,000 people to work in 72 production lines, said Lt Col (retd) Md Shahjahan, general manager of KEPZ Corporation (BD) Ltd, another company of Youngone Group. KEPZ Corporation (BD) Ltd is in charge of developing the EPZ.

It will go for trial production after four of the eight buildings on the lower lap are completed by September, he said.

Karnaphuli Shoe Industries is setting up the factory to encourage other intended entrepreneurs into the sector and address the initial setbacks that one might face in setting up a factory at the newly developed EPZ site, Shahjahan said.

A total of 2,700 acres were allocated through gazette notification back in 2000 to develop the EPZ on the bank of the river Karnaphuli in Anowara upazila.

Seventy-five percent of the land was government-owned, while the rest 25 percent had to be acquired from private owners, the official said. Of 2,700 acres of the allocated land, 2,492 acres have so far been handed over to KEPZ.

However, the authorities could not develop infrastructure or initiate construction of any factory before operating licences were issued in 2007, Shahjahan said.

"After that, we proceeded with infrastructure development, keeping the hilly landscape almost undisturbed.”

"We will have about 1,200 acres to develop industrial plots in separate blocks of different industries, and preserve the rest of the land in its original state."

"So far, 20 to 21 kilometres of roadways have been constructed for better connectivity surrounding the whole project site," he said.

The authorities also planted 12.5 lakh trees to offer natural tranquility inside the premises.

"In addition, we developed 17 lakes on about 130 acres of land to get water at the project site, as ground-water level is far below," Shahjahan said.

"We have an estimated budget of $200 million to develop infrastructure, excluding utility services. About 600 people are working here without any output until now," he said.

"We could have made further progress if required utility, including gas and power, were ensured," he said.

Moreover, a lack of clarity in several private EPZ rules and import permits for equipment of the industrial units also contributed to the slow progress in implementing the KEPZ, he said

This project was stalled for fukcing 7 years only because the korean company was unwilling to pay kickback to Tarique zia and gongue...

 

[TopCat]

The power-rush
Government hopes to sign 1,000MW electricity deals in a month; PM targets 500MW import from India



Rushing to make up for the country's power deficit, the government is reportedly poised to sign up to 10 contracts by May 31 to eventually deliver up to 1,000MW power--enough to light up half of the populous capital city.

A top official of the Power Development Board, who requested anonymity, said the deals are the first of more than a dozen projects the government hopes to sign within a year to generate in all 5,700MW power. These include two very large coal-fired power plants in Khulna and Chittagong.

Most of these projects would take almost three years to complete--except for the two large coal power plants, which will begin operation in early 2015. But nearly a 1,000MW would be pumped into the national grid within a year, significantly easing the ongoing power crisis.

The contracts will require more than a $5 billion investment.

In three years, the move will well cover the power gap including the anticipated growth in demand.

At a ceremony to lay the foundation stone for a 150MW in Chandpur yesterday, Prime Minister Sheikh Hasina said her government will try to import electricity through regional cooperation with countries throughout Asia.

"The present government has taken effective steps to import electricity on an urgent basis from India, Nepal, Bhutan, Myanmar and China," the UNB quoted her as saying.

"We are aware of your sufferings," she said about frequent power cuts. "Let me assure you this government will not leave any stone unturned to increase power and gas production."

Economist Zaid Bakht predicted that if the government is successful pushing through the contracts, it could revive the smaller scale industries now hard hit by the power crisis.

"But for large industries, increasing natural gas supplies is very important," said Bakht. "Due to gas crisis, large investments have stalled. And we do not know what the government is doing to increase gas production. Gas is important for power generation as well."

Bakht also said financing of the contracts would depend on economics of each project and how transparent the government was in soliciting and awarding bids. "I feel that the government is not sharing enough information and people are not aware about what's going on," he said.

PDB Chairman ASM Alamgir Kabir agreed that financing would be a challenge.

"But we must try," he said. "In order to come out from the crisis, we will have to make all out efforts. If we can secure deals with good power companies, financing would not be a problem. After all, the government has got a good financing track record with power companies."

The Awami League government, in power for 14 months, has promised ambitious plans to add 9,000MW power by the end of its term. Until now, however, it has signed only a few deals totalling around 600MW.

With hourly load shedding affecting homes, offices and industries, the government is facing mounting criticism for poor implementation of its plans.

The Power Cell, Electricity Generation Company of Bangladesh (EGCB) and North West Power Generation Company (NWPGC) have all failed to complete a single tender in the last one year. It is often alleged that these small agencies easily get influenced by business lobbies, resulting in slowing down of the awarding of tenders.

"If they acted competently, we would have gained 1,000MW power from 2012," said a power ministry official.

The EGCB's poor handling of a 300MW power deal with World Bank financing is now going for a re-tender.

With a very poor track record of project implementation, the Power Cell is now set to publish the "request for proposal" document for its Bibiyana 450MW power project within two weeks. Two other tenders totalling 300MW capacity in Sirajganj and Khulna are also expected to make some major progress in May, officials claimed.

A consultant of Indian National Thermal Power Company is now carrying out a feasibility study to set up two largest projects: 1,350MW coal-fired power plants in Khulna and Chittagong. The Khulna plant will be publicly financed while the Chittagong would be under private investment.

"We have started acquiring land in Khulna and Chittagong in this connection," said the PDB official. "We hope by the end of this year, we will be able to sign agreements for these plants."

The government has also floated a tender to set up a 40km transmission line and a high voltage substation near the southwestern border of the country to import power from India.

At the ceremony yesterday Hasina said the technical experts team from both the countries are working hectically to make this happen.

"We hope we will be able to import 500MW electricity from India by 2012," she said.

PDB sources, however, said Bangladesh will more likely pull 250MW from this line.

If Prime Minister Sheikh Hasina's upcoming visit to Russia can secure a nuclear power deal, the country will have another 2,000MW nuclear power project in the pipeline. It takes about six years to implement a nuclear power project. However, this move is still uncertain

 

[TopCat]

PM reiterates open pit mine for power


Prime Minister Sheikh Hasina on Monday advocated for open pit coal mining in Barapukuria and asked the power ministry to make an assessment on how much power could be generated with the coal there.


At a cabinet meeting, the prime minister said her government was not concerned about what “others’” would say about open pit mining.


“We are concerned about what would benefit us the most and how much it would affect the environment,” a cabinet member told The Daily Star quoting the prime minister as saying. She was indicating at the oil, gas and port protection committee’s resistance on open pit mining.


“Some people suggest that it is possible to set up power plants with 10,000 MW capacity, some suggest it could be 15,000 MW. The power ministry may make a presentation on exactly what can be done with the coal,” the PM was quoted as saying.


A cabinet member told The Daily Star that the PM was likely to make a major reshuffle very soon to ensure higher efficiency with the power ministry and all other power related bodies. She felt that many officials were unproductive and unable to give decisions and they must go.


The PM also directed the authorities concerned to make it legally mandatory for all new buildings and establishments to be equipped with solar power panels to meet internal demands.


She directed the power ministry to take steps to set up wind power facilities in Chittagong and Noakhali and a third hydropower plant in Kaptai.


On signing unsolicited deals with rental power companies for fast power generation, Hasina told few of her colleagues that she had taken the initiatives with honest intention to end power crisis as quickly as possible—and not for any personal gains.


Hasina will take steps in the interest of people even if someone sues her, said a senior cabinet member quoting the PM

 

[idune]

Here is the Awami digital deception: Awami regime told people 1360 MW by March, 2010. March has gone by NOT a single MW added by Awami regime initiative.

Power grid gets 1,360 MW by March

Thursday, December 24, 2009

Star Online ReportA total of 1,360 megawatts power would be added to the national grid in next three months, said the chairman of a parliamentary standing committee on Thursday.

Maj Gen (retd) Shubid Ali Bhuiyan, chairman of the parliamentary standing committee on energy, oil and mineral resources ministry, said 960 MW would be added to national grid by January next and 400 MW by March.

Here is reality:

5 fertiliser factories shut down

Saturday, April 3, 2010

Unb, Dhaka The Karnaphuli Fertiliser Company Ltd (Kafco) and Chittagong Urea Fertiliser Ltd (CUFL) were shut down yesterday while three other factories were on the process of closing down.

“I received a message from the concerned officials that the major two factories-- Kafco and CUFL--were shut down,” Petrobangla Chairman Hossain Mansur told UNB last night.

He said that three other plants--Palash (Ghorasal) Fertiliser Factory, Jamuna Fertiliser Factory and Zia Fertiliser Factory--would be shut down by midnight yesterday.

The steps were taken as part of the government move to increase gas supply to the power plants.

5 fertiliser factories shut down

------------------------------------------------------------------

Countrywide agitation: 200mw power diverted from Dhaka to meet demand

March 26, 2010, Updated: Bangladesh Time 12:00 AM

Sufferings of city dwellers would mount next days as the government decided to cut 200MW of electricity from Dhaka and its adjoining areas to divert it for Boro irrigation.

The decision was taken at an inter-ministerial meeting yesterday to ensure 10-hour uninterrupted electricity supply instead of seven hours to make sure boro production.

The New Nation - Internet Edition

 

[Skies]

I m not sure but someone told me that, no sooner as the fertilizer industries are closed then AL has completed so quickly all procedures for importing fertilizer at high cost from India and AL is responsible for closing those industries.

 

[TopCat]

I m not sure but someone told me that, no sooner as the fertilizer industries are closed then AL has completed so quickly all procedures for importing fertilizer at high cost from India and AL is responsible for closing those industries.

India does not export Urea. Infact last time I checked, it was banned.

 

[Al-zakir]

Well Mr. Al-Zakir,
How this news is the fault of AL?
Too many unskilled labor and unhealthy indeed. And they were sent in the BNP regime. If they were trained enough and had good medical test before sending then we did not have to come to this point.

Iajdani sahaib
How much longer do you think that blaming on BNP-Jamat finally be over?
Perhaps you forgot that we are out of power for last 3 and 1/2 years. It ain't going to fly for long, you know....

But make sure in 2014 you dont go and vote for BNP again, then all the good works of AL will go in vein.

 

[Fasih Khan]

How damn similar the political conditions are, in Pakistan and Bangladesh. Both our countries are twins politically. Our politicians keep derailing our economies and involve in mass plunder of our both nation's resources. May we be able to get rid of these criminals and get good and sincere leaderships in our countries. Ameen.

 

[idune]

Bangladesh garment exporter blames govt for loss of US mkt share

Sat Apr 10, 2010 5:37pm IST

DHAKA (Reuters) - Bangladesh's garment exports to the United States fell 4.5 percent last year because major competitors were able to cut prices while Bangladesh exporters had to raise prices in the absence of government support during the financial crisis, a leading exporter said Saturday.

"Bangladesh had better market in the U.S.A earlier, but now it is declining as the prices of our ready-made garment products increased there despite global recession," said Anwarul Alam Chowdhury, a leading exporter and former president of the Bangladesh Garment Manufacturers and Exporters Association.

"But our main competitors like China, India, Vietnam and Cambodia reduced prices to keep themselves competitive in the U.S.A market," Anwarul told reporters at a news briefing.

The United States is Bangladesh's biggest market for its ready-made garment exports, which totalled $3.3 billion in 2009.

Prices for Bangladesh-made garments increased 2.32 percent in 2009 while Cambodia's prices dropped 6.59 percent, China's fell 12.44 percent, India's dipped 4.68 percent and prices of garments from Vietnam dived 12.42 percent.

Anwarul said that competing countries offered lower prices after their governments provided stimulus last year unlike Bangladesh's government which, he said, failed to take timely decisions in the face of the global recession.

Vietnam and Pakistan devalued their currencies nearly 30 percent in 2009 while India devalued about 28 percent and cut interest rates, Anwarul said.

China, the largest apparel maker in the world, withdrew value added tax during the global economic downturn.

Anwarul said if the government spent only $210 million, local apparel makers would be able to reduce export prices by up to 3 percent.

Ready-made garments account for 80 percent of Bangladesh's total annual exports while the sector employs about 3 million people, mostly women.

Bangladesh has set this fiscal year's (July 2009-June 2010) export target at $17.6 billion, 13 percent above last year.

Exports rose 10.3 percent to $15.56 billion in the 2008/09 fiscal year, the lowest growth in six years.

Bangladesh garment exporter blames govt for loss of US mkt share | South Asia | Reuters

 

[idune]

Another blow to Bangladesh export and export competetiveness because of Awami regime deceision.

------------------------------------------------------------------------
Cargo handling operation
Port operations fall after CPA's take-over
Jasim Uddin Haroon

The performance of the country's premier port has been deteriorating fast since the Chittagong Port Authority (CPA) took the cargo handling operation under its own management last week.

Shipping circles said that vessels' turnaround time at the port increased by at least one day leading to huge financial losses both for shippers and consignees over the past week.
Three large feeder vessels -- Carla Rickmar, OEL Blessings and Sinar Suvang -- have failed to sail out on schedule following the poor performance. The vessels, however, left the port on Monday instead of Sunday.

The CPA earlier suspended the activities of operators at 12 berths and started cargo handling under its own management from May 11.

The CPA move came after a group of aggrieved co-berth operators secured a High Court order on April 29 to stop the activities of the operators and the notice was served to the CPA last week.

Currently, port workers are involved in handling equipment and other related jobs done by the men of berth operators.

Captain Md Rafiqul Islam, country director of Singapore-based PIL, a feeder operator, said his vessel -- Kota Rahmat -- arrived the port May 15 and was scheduled to leave May 17 saying: "My vessel is yet to sail out the port as the port's work has slowed down over the past one week."

Mr Rafique said this delay will lead to huge losses.

In the meantime, leaders of Bangladesh Shipping Agents Association (BSAA) expressed its grave concern to the CPA Sunday.

"We're really worried over the fast deterioration of the port activities," Ahsanul Hoque Chowdhry, chairman of the BSAA told the FE.

He hinted that the feeder operators might impose surcharge if the current situation prevails.

However, port officials said that the CPA would continue operation until the appointments of new berth operators through competitive biddings.

The port handles more than 90 per cent of the country's around $37 billion external trade.

It handled 1,161,469 containers in 2009 against 1,069,999 containers in the previous year.

Port operations fall after CPA's take-over

 

[idune]

Awami regime once again taking fiscal policy that will increase cost of borrowing and stifle private investment in Bangladesh; lifeline of growth and job creation. Awami systematic destruction of Bangladesh economy continues….

------------------------------------------------------------------------
Bank borrowing likely to double in next budget

Asif Showkat

Inflation and bank interest rates may increase if the government goes for large-scale borrowing from the banking sector to meet the widening budget deficit in the next financial year, financial experts and economists feared.

The government has projected its bank borrowings for budgetary support at Tk 15,680 crore for the next financial year against the amount of Tk 8,611 crore in the current financial year.The banks will also face liquidity shortage as the central bank has raised cash reserve requirement for the banks, they said.

Budget deficit during the next financial year has been projected at Tk 34,514 crore, 68.60 per cent of which is planned to be borrowed from local banks and savings instruments. A budget deficit of 4.4 per cent of GDP is being forecast for the 2010-11 financial year.

Of Tk 34,514 crore, Tk 23,680 crore would come from domestic resources while the rest are expected to come from the foreign loans.
Around 64.64 per cent of current year’s revised budget of Tk 27,297 crore is also being made up by such borrowings. However, the budget surplus was Tk 946 crore in the current financial year in the first two quarters, an official said.

The government has projected its bank borrowings for budgetary support at Tk 15,680 crore for the next financial year which would be 81 per cent higher than that of the current financial year’s revised budget. Bank borrowing during the current financial year (revised budget) amounted to Tk 8, 661 crore.

The long- and short-term loans would be Tk 12,570 crore and Tk 3,110 crore respectively. Non-banking loans would be of Tk 8,000 crore while the loan from national saving certificate would be Tk 7,477 crore.The central bank in the past week raised the cash reserve requirement for banks from 5.5 per cent to 6.5 per cent after four years.

The cash reserve requirement is a central bank regulation that sets the minimum reserves for each bank against the customer deposits. The reserve ratio is sometimes used as a tool in the monetary policy, influencing the country’s economy, borrowing and interest rates.

The private sector credit was 19.52 per cent in February this year up from 19.25 per cent in January 2010, according to the Bangladesh Bank statistics. Most of banks keep interest rate below 10 per cent in case of big loans, but for other loans the rate is high, the central bank sources said.

The inflation rate slightly eased to 8.78 per cent in March from 9.06 per cent in February last, Bangladesh Bureau of Statistics data showed.

Bangladesh Bank Governor Atiur Rahman had earlier indicated that the CRR measure should help contain inflation.

Terming the raise nominal, he said, ‘It is true that the private sector will be a bit unhappy. Even after that we have to do so because we have to check inflation.’

Former finance adviser Akbar Ali Khan told New Age that the bank borrowing for budget support and increase of CRR ratio would put a negative impact in two ways on the country’s economy. One is ‘crowding out’ of the private sector credit flow, and the other is that it would cause increase in inflation rate due to shortage of credit flow.

Former Bangladesh Bank governor Farashuddin Ahmed said increase in bank borrowings as well as increase of the CRR ratio would not affect the credit flow and inflation if the government spends that money in the productive sectors.

Dhaka University professor Selim Raihan said that there would be a possibility of lack of credit flow in the private sector due to increased bank borrowings for budget support.

He said if the government fails to spend the fund borrowed from the banks, it would affect the economy. In the current financial year, the government could not spend the funds borrowed from the banks, he pointed out.

Chowdhury Golam Kibria, a teacher of business administration at Jahangirnagar University, said that the government would resort to increased bank borrowings just to meet unplanned expenses.

http://www.newagebd.com/2010/may/16/front.html#1

 

[idune]

Bangladesh economic growth slows to 7-yr low

Agence France-Presse . Dhaka

Bangladesh said Wednesday that its economy grew at the slowest pace for seven years as the global downturn hit exports while drought and floods cut into agriculture and power troubles rocked industry.

The Bangladesh Bureau of Statistics said growth in the year to June came in at 5.54 per cent, the lowest since 2002-2003, when the economy expanded just 5.3 per cent.

Bangladesh's financial year runs to the end of June, but the government published the growth figures ahead of the annual budget due on June 10.

Ziauddin Ahmed, a deputy director at the bureau, said the figure was helped by a better-than-expected 6.5 per cent expansion of the services sector, which now makes up more than half of the country's gross domestic product.

But the government and central bank's forecast of six per cent growth has proved optimistic, as industry only grew five per cent, while agriculture expanded 2.77 per cent.

‘Bangladesh's industry is dependent on exports. But shipments were battered by the worst ever global economic recession,’ said Zaid Bakht, head of research the Bangladesh Institute of Development Studies, a government think-tank.

‘The energy crisis also affected industrial growth,’ Bakht said. Bangladesh is in the grips of the worst utilities crisis in its history, with chronic power shortages taking a heavy toll on industry.
Overall exports were down one per cent year on year in the nine months to the end of March, with apparel, which accounted for 80 per cent of $15.56 billion shipments last year, seeing a fall in orders.

Business

 

[eastwatch]

PM reiterates open pit mine for power

I have personal endorsement for open-pit mining of coals in the 5 coal mines in our NW. The quantity of coal in these mines contain 2500 million tons. If converted to gas equivalent, this will be equal to 90 trillion cft of gas. Electricity that we can get from coal is about 4 or 5 times larger than what we can get from our gas.

There are some anti-State people who are trying to stab BD by demanding tunnelling system instead of open pit method to extract coal. The former method will produce less than 25% of what the open method can produce. Country's energy future must not be allowed to fall into these anti-state people. These people prefer BD to import Indian coal that contain much more ash and sulpher.

I wonder, who or which country is organizing this group.

 

[idune]

Govt's priority on ad-hoc solutions ‘likely to create energy crisis’

M Azizur Rahman

The government is emphasising ad-hoc solutions to the country's electricity crisis, eschewing long-term action plans to ramp up primary energy resources, leading to a catastrophic energy crisis ahead, experts feared.

They said the government is now over reliant on short-term mechanisms to resolve energy crisis by setting up high-cost plants, neglecting the prospects of cheap and reliable energy sources.

The government high-ups have concentrated on building expensive rental power plants even without tenders, keeping the works to ensure utilisation of cheap and future energy resources like natural gas exploration and coal mine development at bay.

The state coffer is at risk of providing a colossal subsidy amounting to over Tk 150 billion by 2013 to run the high-cost diesel and furnace oil-based power plants.

"The government is implementing the high cost rental power plants to shrug off immediate crisis. But any visible move from the government to expedite coal extraction or natural gas exploration is still absent," Professor M Tamim of Bangladesh University of Engineering and Technology (BUET) told the FE Sunday.

Tenure of short-term rental power plants might be extended, if the country lacks primary energy resources, he cautioned.

Officials said the country is yet to tap the potential of its huge coal reserves, the cheapest primary source of energy, as development of the coalmines has been stalled for long in the name of 'finalising' national coal policy.

Despite having a reserve of over 3.0 billion tonnes of high quality coal, the governments in the past years did not take any pragmatic step to utilise it, except merely sitting with the draft of the national coal policy, said a senior Petrobangla official.

Foreign investments worth over US$5.0 billion is now hanging on the government's decision regarding the policy.

Besides, signing of production sharing contracts (PSCs) with two foreign firms - US ConocoPhillips and Irish Tullow - for offshore hydrocarbon exploration has been halted for over the past couple of years.

Previous caretaker government had launched the offshore bidding round in February 2008 for oil and gas exploration, which is now stalled over the row of maritime disputes with neighbouring India and Myanmar.

Launching of a fresh onshore bidding round is not yet decided despite lifting of High Court ban on signing PSCs last year.

The 'fast track' programme initiated by Petrobangla last year to augment gas production from the state-run gas-fields is not yet finalised.

Seepage in Titas gas-fields is still unabated due to negligence by the authorities concerned. The proposals from private sector to allow them build oil refinery facilities have remained shelved for long.

"Governments' stand for running after unsolicited rental power plants to generate electricity using expensive fuel sources is not at all acceptable," said Professor Anu Muhammad of Jahangirnagar University.

The government should go for renovating the age-old power plants instead of building high-cost rental power plants, he said. He also stressed for coal gasification mechanism to tape the country's huge coal reserve potential.

The local state-owned enterprises should be strengthened and engaged more in oil and gas exploration for a secure energy supply situation, he added.

At present the country is reeling under acute crisis of both electricity and natural gas with the electricity supply hovering around 4,200 megawatts against the demand for over 6,000 mw, and gas supply around 1,980 million cubic feet per day (mmcfd) against the demand for over 2,200 mmcfd.

Govt's priority on ad-hoc solutions ‘likely to create energy crisis’

 

[idune]

Foreign assistance surges by 520.73pc
Asif Showkat

Foreign assistance surged by 520.73 per cent during the first three quarters (June–March) of the current fiscal year showing increased dependence on foreign assistance, official sources said.


A report on ‘Budget 2009-10 fiscal year : Till third quarter, progress of implementation and macro economic analysis’, prepared by the macro economic wing of the finance ministry said the government has mobilized foreign assistance of Tk 6,915 crore during last nine months with a 520.73 per cent or Tk 5,801 crore increase compared to previous fiscal year’s amount of Tk 1,114 crore.

.
.
.
Front Page