Bangladesh Economy: News & Updates

[Banglar Bir]

Terminated: The inside story of Accenture’s departure from Bangladesh

• Manik Miazee
• Published at 01:38 AM August 04, 2017

Photo:Rajib Dhar
'All everyone will remember is that Accenture’s Bangladesh venture failed'
Late last year, the 500-odd employees of consulting and outsourcing giant Accenture PLC’s Bangladesh office grew worried at the company’s failure to attract fresh business. There were rumours flying around that if the Dhaka office didn’t see an upturn in fortunes soon, Accenture might pull out. In February this year, the employees’ union staged a protest against what they saw as the management’s inability to grow the Bangladesh business.

Accenture, a Fortune 500 company with global revenues in excess of $32 billion annually, launched its Bangladesh operation in 2013, paying a reported $10 million for a 51% stake in GPIT, a subsidiary of mobile phone operator Grameenphone.

The plan was for the new company, Accenture Communications Infrastructure Solutions Limited, to provide information technology support to Grameenphone as well as function as an outsourcing hub for Telenor, the Norwegian telecommunications conglomerate which controls Grameenphone and several other mobile operators in the region.

Accenture’s leadership thought the Bangladesh arm’s long term viability would be ensured by attracting new outsourcing contracts from North America and Europe, several people with knowledge of the deal with Telenor said.

At the time, Bangladeshi experts welcomed the entry of a leading outsourcing company like Accenture, which they said would cement the country’s image as an emerging hub for business process outsourcing or BPO.

Last month, Accenture Communications Infrastructure Solutions Limited informed all its 556 employees that their services would not be required after November, prompting the employees’ union to call an immediate strike.

Interviews with several current and former Accenture employees reveal that the relationship between the management, almost entirely composed of Indian staff from the company’s Hyderabad office, and the Bangladeshi employees, most of whom had been brought over from GPIT, was troubled from almost the beginning.

Tensions rose in 2014 after the management cut some employee benefits, including a 20,000 taka allowance to buy mobile phones, given every two years at GPIT. The Bangladeshi employees were also asked to work an extra hour, which the management said would help sync production with the Hyderabad office.

The aggrieved employees decided to form a union to ensure collective bargaining rights. Eventually around 400 of the 556 staff members joined the union.

The protest in February was quickly followed by another standoff in April when the management terminated Azizur Rahman, an analyst with the Workplace team. Protests on the floor, however, failed to sway the management.

“I think they wanted to test the waters by sacking me,” Azizur Rahman said. “I was never given any reason for my termination. They made an example of me.”

When Accenture took over GPIT and Grameenphone’s IT support contract in 2013, the mood was optimistic.

Bob Sell, group chief executive of Accenture’s Communications, Media & Technology operating group, said in a statement: “We are excited to be investing in the largest IT services company in Bangladesh.”

He added that the “strategic investment” would allow Accenture to tap into a robust pool of skills and capabilities in the country.

However, Accenture’s GPIT deal was only a small part of a US$215 million global contract with Telenor to provide services in areas including Finance & Accounting, HR, IT and transactional purchases.

Under the global deal, Accenture’s Bangladesh office started working for several other Telenor subsidiaries including Telenor Pakistan, Thailand-based telecom operator Dtac, Malaysia’s Digi, and Telenor Global Shared Services (GSS), Telenor’s worldwide service center for Finance, HR & payroll, procurement and IT services.

However, the ‘local contract’ deal with Grameenphone was seen as the mainstay of the Bangladesh operation, since the ‘global contract’ work was spread out over several Accenture offices. Several current and former Bangladeshi employees said Accenture never grew the Dhaka office into a proper hub. The management of Accenture Communications Infrastructure Solutions Limited always looked to the Hyderabad office for guidance.

“The Dhaka office was a satellite,” a former employee said.

The Bangladeshi employees felt the Indian bosses did not fully understand the local work culture and many hankered after the ‘old days’ of GPIT under Grameenphone management. The management was frustrated by the union’s demands and viewed the employees’ increasing activism as a problem, a source said.

Tensions also grew between the sole senior Bangladeshi manager, CEO Raihan Shamsi and Chief Operating Officer (COO) Purushothama Kadambu. The friction between the two men led to the sidelining of Raihan who spent most of this year at Accenture’s Kuala Lumpur office, according to sources.

Raihan Shamsi declined to comment. Purushothama Kadambu could not be reached for comment.

The first real jolt to the Accenture Bangladesh business came last year when Telenor Pakistan decided to withdraw its work. At roughly the same time, Accenture was locked in negotiations with Grameenphone to increase service charges. After the negotiations failed, Telenor opted for an open tender for services, leading to the GP contract to be awarded to Wipro, a Bangalore-based Indian BPO company.

Grameenphone also reacted by creating an in-house unit to provide IT support, a move which analysts said reverted back to the ‘GPIT model’.

The loss of the GP contract was the final blow for Accenture. The management no longer saw the Bangladesh office as a viable business unit.

“It was easy for them to distribute the remaining work to the India offices,” a source said. “The management had no commitment to Bangladesh.”

Accenture PLC did not respond to requests for comment. A public relations firm working with the Bangladesh office, said in a statement: “Accenture, Telenor Group, and Grameenphone are working closely together to re-organise several engagements across Asia and Europe.”

Shahin Ahmed, general secretary of Accenture Employees Union, Bangladesh, said this left the Bangladeshi employees in the lurch.

“Many of us left Grameenphone to work for Accenture in 2013,” he said. “The future is uncertain for all of us now.”

Shahin called on the government to intervene, saying Accenture’s departure would send the wrong signal to the international BPO industry. He said: “No one will remember that Accenture left because the management here fell out with Grameenphone.

“All everyone will remember is that Accenture’s Bangladesh venture failed.”

http://www.dhakatribune.com/busines...inside-story-accentures-departure-bangladesh/

 

[Nilgiri]

^^^^ @gslv mk3

Few of the regular crowd just got their dreams of "BPO BD" blown away.

The Bangladeshi employees felt the Indian bosses....blah blah blah

Now where have I seen this before?

 

[Mage]

Since it is against copyright policy of "Financial Times" to copy their article and share it....I'm just gonna give the link.
https://www.ft.com/content/5491a288-7b7b-11e7-9108-edda0bcbc928

 

[Homo Sapiens]

@Bilal9 @Philia @Species @Khan saheb

 

[Guynextdoor2]

Never seen one



Train does not deliver the good to your doorstep but truckers do. You have to hire truck to carry them from train station to your warehouse which will cost almost as much as to carry it from the original location. I am saying you the actual scenario. Businesses wont be able to save money for these short distances for sure.

diesel locos the diesel engines power the electric motors. In electric the power is taken directly to the motors. More power on the lines means more power than what a standlone diesel engine can produce.

 

[Banglar Bir]

2:37 AM, August 08, 2017 / LAST MODIFIED: 04:33 AM, August 08, 2017
Dhaka-Ctg double-decker bus soon

Staff Correspondent

Wait for a lavish bus journey between Dhaka and Chittagong cities is almost over.

By the end of this month, people will be able to hop on a double-decker deluxe bus to travel between the two prime destinations of the country.

Private transport operator Green Line Paribahan is making this possible with ten such brand-new imported buses.

The buses will hit the road after August 20 following completion of necessary formalities and one-way fare for each passenger would be Tk 1,300, Abdus Sattar, general manager of the bus service told The Daily Star.

Made in Germany by MAN Truck & Bus Deutschland GmbH, the body of the 40-seater vehicles are fabricated in Malaysia. The buses already arrived in Chittagong port and will be brought to Dhaka within few days for registration, he added.

Road Transport and Bridges Minister Obaidul Quader is expected to inaugurate the service in between August 18 and 20, Sattar said.

Double-decker buses have been plying the streets of Dhaka city since 1989 under city service. Two bus operators previously introduced double-decker buses on intercity routes, but discontinued the service within a few months.

“Brand-new double-decker buses will run on long distance routes for the first time in the country. One or two companies had introduced reconditioned double-decker buses on long routes, but stopped their services within a few months,” claimed the GM of Green Line.

An enthusiastic employee of a private firm, Suman Mahmud, said, “I've heard that long-distance double-decker services are available in many countries. I am really excited after learning that similar service is going to be introduced on the Dhaka-Chittagong route as well.”

Commenting on the technical aspects of running a double-decker bus on the Dhaka-Chittagong highway, Kazi M Shifun Newaz, assistant professor of Accident Research Institute at Bangladesh University of Engineering and Technology (Buet), said, the highway is suitable for double-decker buses.

However, the drivers of such buses should maintain a speed limit of 80 kilometres per hour (kph) and they will have to bring the speed down to half -- 40 kph -- at while making a turn or passing by markets and crowded zones, he added.

The drivers will also have to exercise caution while going over a bridge, the Buet professor said.

Green Line Paribahan is a family-owned transport company specialising in passenger bus services since 1990. It introduced country's first air-conditioned bus service.

http://www.thedailystar.net/city/dhaka-ctg-double-decker-bus-soon-1445392

2:37 AM, August 08, 2017 / LAST MODIFIED: 04:33 AM, August 08, 2017
Dhaka-Ctg double-decker bus soon

Staff Correspondent

Wait for a lavish bus journey between Dhaka and Chittagong cities is almost over.

By the end of this month, people will be able to hop on a double-decker deluxe bus to travel between the two prime destinations of the country.

Private transport operator Green Line Paribahan is making this possible with ten such brand-new imported buses.

The buses will hit the road after August 20 following completion of necessary formalities and one-way fare for each passenger would be Tk 1,300, Abdus Sattar, general manager of the bus service told The Daily Star.

Made in Germany by MAN Truck & Bus Deutschland GmbH, the body of the 40-seater vehicles are fabricated in Malaysia. The buses already arrived in Chittagong port and will be brought to Dhaka within few days for registration, he added.

Road Transport and Bridges Minister Obaidul Quader is expected to inaugurate the service in between August 18 and 20, Sattar said.

Double-decker buses have been plying the streets of Dhaka city since 1989 under city service. Two bus operators previously introduced double-decker buses on intercity routes, but discontinued the service within a few months.

“Brand-new double-decker buses will run on long distance routes for the first time in the country. One or two companies had introduced reconditioned double-decker buses on long routes, but stopped their services within a few months,” claimed the GM of Green Line.

An enthusiastic employee of a private firm, Suman Mahmud, said, “I've heard that long-distance double-decker services are available in many countries. I am really excited after learning that similar service is going to be introduced on the Dhaka-Chittagong route as well.”

Commenting on the technical aspects of running a double-decker bus on the Dhaka-Chittagong highway, Kazi M Shifun Newaz, assistant professor of Accident Research Institute at Bangladesh University of Engineering and Technology (Buet), said, the highway is suitable for double-decker buses.

However, the drivers of such buses should maintain a speed limit of 80 kilometres per hour (kph) and they will have to bring the speed down to half -- 40 kph -- at while making a turn or passing by markets and crowded zones, he added.

The drivers will also have to exercise caution while going over a bridge, the Buet professor said.

Green Line Paribahan is a family-owned transport company specialising in passenger bus services since 1990. It introduced country's first air-conditioned bus service.

http://www.thedailystar.net/city/dhaka-ctg-double-decker-bus-soon-1445392

 

[wiseone2]

2:37 AM, August 08, 2017 / LAST MODIFIED: 04:33 AM, August 08, 2017
Dhaka-Ctg double-decker bus soon

Staff Correspondent

Wait for a lavish bus journey between Dhaka and Chittagong cities is almost over.

By the end of this month, people will be able to hop on a double-decker deluxe bus to travel between the two prime destinations of the country.

Private transport operator Green Line Paribahan is making this possible with ten such brand-new imported buses.

The buses will hit the road after August 20 following completion of necessary formalities and one-way fare for each passenger would be Tk 1,300, Abdus Sattar, general manager of the bus service told The Daily Star.

Made in Germany by MAN Truck & Bus Deutschland GmbH, the body of the 40-seater vehicles are fabricated in Malaysia. The buses already arrived in Chittagong port and will be brought to Dhaka within few days for registration, he added.

Road Transport and Bridges Minister Obaidul Quader is expected to inaugurate the service in between August 18 and 20, Sattar said.

Double-decker buses have been plying the streets of Dhaka city since 1989 under city service. Two bus operators previously introduced double-decker buses on intercity routes, but discontinued the service within a few months.

“Brand-new double-decker buses will run on long distance routes for the first time in the country. One or two companies had introduced reconditioned double-decker buses on long routes, but stopped their services within a few months,” claimed the GM of Green Line.

An enthusiastic employee of a private firm, Suman Mahmud, said, “I've heard that long-distance double-decker services are available in many countries. I am really excited after learning that similar service is going to be introduced on the Dhaka-Chittagong route as well.”

Commenting on the technical aspects of running a double-decker bus on the Dhaka-Chittagong highway, Kazi M Shifun Newaz, assistant professor of Accident Research Institute at Bangladesh University of Engineering and Technology (Buet), said, the highway is suitable for double-decker buses.

However, the drivers of such buses should maintain a speed limit of 80 kilometres per hour (kph) and they will have to bring the speed down to half -- 40 kph -- at while making a turn or passing by markets and crowded zones, he added.

The drivers will also have to exercise caution while going over a bridge, the Buet professor said.

Green Line Paribahan is a family-owned transport company specialising in passenger bus services since 1990. It introduced country's first air-conditioned bus service.

http://www.thedailystar.net/city/dhaka-ctg-double-decker-bus-soon-1445392

2:37 AM, August 08, 2017 / LAST MODIFIED: 04:33 AM, August 08, 2017
Dhaka-Ctg double-decker bus soon

Staff Correspondent

Wait for a lavish bus journey between Dhaka and Chittagong cities is almost over.

By the end of this month, people will be able to hop on a double-decker deluxe bus to travel between the two prime destinations of the country.

Private transport operator Green Line Paribahan is making this possible with ten such brand-new imported buses.

The buses will hit the road after August 20 following completion of necessary formalities and one-way fare for each passenger would be Tk 1,300, Abdus Sattar, general manager of the bus service told The Daily Star.

Made in Germany by MAN Truck & Bus Deutschland GmbH, the body of the 40-seater vehicles are fabricated in Malaysia. The buses already arrived in Chittagong port and will be brought to Dhaka within few days for registration, he added.

Road Transport and Bridges Minister Obaidul Quader is expected to inaugurate the service in between August 18 and 20, Sattar said.

Double-decker buses have been plying the streets of Dhaka city since 1989 under city service. Two bus operators previously introduced double-decker buses on intercity routes, but discontinued the service within a few months.

“Brand-new double-decker buses will run on long distance routes for the first time in the country. One or two companies had introduced reconditioned double-decker buses on long routes, but stopped their services within a few months,” claimed the GM of Green Line.

An enthusiastic employee of a private firm, Suman Mahmud, said, “I've heard that long-distance double-decker services are available in many countries. I am really excited after learning that similar service is going to be introduced on the Dhaka-Chittagong route as well.”

Commenting on the technical aspects of running a double-decker bus on the Dhaka-Chittagong highway, Kazi M Shifun Newaz, assistant professor of Accident Research Institute at Bangladesh University of Engineering and Technology (Buet), said, the highway is suitable for double-decker buses.

However, the drivers of such buses should maintain a speed limit of 80 kilometres per hour (kph) and they will have to bring the speed down to half -- 40 kph -- at while making a turn or passing by markets and crowded zones, he added.

The drivers will also have to exercise caution while going over a bridge, the Buet professor said.

Green Line Paribahan is a family-owned transport company specialising in passenger bus services since 1990. It introduced country's first air-conditioned bus service.

http://www.thedailystar.net/city/dhaka-ctg-double-decker-bus-soon-1445392

what is lavish or luxurious about this ? I realize luxury is a relative term

 

[RISING SUN]

Bangladesh signs big rice deal with Cambodia
Bangladesh has signed a deal to buy 250,000 tonnes of milled rice from Cambodia, two weeks after the two countries signed a memorandum of understanding.

The purchasing agreement was made on Monday after the officials from state-owned Green Trade Company and the Cambodia Rice Federation (CRF) flew to Bangladesh last week to negotiate in detail on the purchasing agreements between Bangladesh and Cambodia based on the government-to-government MoU, the Khmer Times reported on Wednesday.

CRF president Sok Puthyvuth said on Tuesday that Bangladesh was interested in Cambodian rice and wanted to have a relationship with Cambodia.

He said that there were tough negotiations and competition with Thailand, India and Vietnam also wooing Bangladesh to purchase rice from them.

However, Bangladesh chose Cambodia.

Bangladesh, the world’s fourth-biggest rice producer, has emerged as a major importer of the grain this year after flash floods in April hit domestic output. As a result, the country is facing dwindling stocks and high local prices.

“We will work with the CRF’s members, Green Trade and Rural Development Bank to strengthen the export soon,” Puthyvuth said.

“We want the export to take place as soon as possible,” he said. “We are not worried as Bangladesh gave us enough time,” he added.

He said that CRF will talk with its members on the amount to export to Bangladesh and would get feedback soon on their ability to export to Bangladesh.

“Prices will be based on the market price but we will continue to talk to find a win-win solution between Cambodian farmers and Bangladesh,” Puthyvuth said.

“At the moment, the price we are offering Bangladesh is competitive compared with Vietnam, Thailand and India.

“In the next five years, the price will be higher as Cambodia modernises its agriculture, particularly the rice sector,” Puthyvuth said.

On Aug 2, the Cambodian Commerce Ministry and Bangladesh signed the MoU to sell about a million tonnes of rice in the five years to 2022.

Sok Sopheak, under-secretary of state at the Ministry of Commerce, said the quality of rice and pricing were crucial for Cambodia to compete with Thailand and India who had also signed MoUs with Bangladesh.

He said costs on such aspects as logistics and terminal handling charges would be kept as low as possible.

Song Saran, CEO of AMRU Rice, welcomed the agreement with Bangladesh, saying it opened new markets for Cambodia.

“The private sector is keen to make this agreement work. We will ensure the Bangladeshis that the rice they get from us will be the best quality,” he said.
http://www.bangkokpost.com/news/asean/1307276/bangladesh-signs-big-rice-deal-with-cambodia

 

[Bilal9]

Green Line introduces double-decker long-haul busses, a first in Bangladesh

 

[Bilal9]

New wet leased A330, First for Biman.

 

[Bilal9]

Terminated: The inside story of Accenture’s departure from Bangladesh

• Manik Miazee
• Published at 01:38 AM August 04, 2017

Photo:Rajib Dhar
'All everyone will remember is that Accenture’s Bangladesh venture failed'
Late last year, the 500-odd employees of consulting and outsourcing giant Accenture PLC’s Bangladesh office grew worried at the company’s failure to attract fresh business. There were rumours flying around that if the Dhaka office didn’t see an upturn in fortunes soon, Accenture might pull out. In February this year, the employees’ union staged a protest against what they saw as the management’s inability to grow the Bangladesh business.

Accenture, a Fortune 500 company with global revenues in excess of $32 billion annually, launched its Bangladesh operation in 2013, paying a reported $10 million for a 51% stake in GPIT, a subsidiary of mobile phone operator Grameenphone.

The plan was for the new company, Accenture Communications Infrastructure Solutions Limited, to provide information technology support to Grameenphone as well as function as an outsourcing hub for Telenor, the Norwegian telecommunications conglomerate which controls Grameenphone and several other mobile operators in the region.

Accenture’s leadership thought the Bangladesh arm’s long term viability would be ensured by attracting new outsourcing contracts from North America and Europe, several people with knowledge of the deal with Telenor said.

At the time, Bangladeshi experts welcomed the entry of a leading outsourcing company like Accenture, which they said would cement the country’s image as an emerging hub for business process outsourcing or BPO.

Last month, Accenture Communications Infrastructure Solutions Limited informed all its 556 employees that their services would not be required after November, prompting the employees’ union to call an immediate strike.

Interviews with several current and former Accenture employees reveal that the relationship between the management, almost entirely composed of Indian staff from the company’s Hyderabad office, and the Bangladeshi employees, most of whom had been brought over from GPIT, was troubled from almost the beginning.

Tensions rose in 2014 after the management cut some employee benefits, including a 20,000 taka allowance to buy mobile phones, given every two years at GPIT. The Bangladeshi employees were also asked to work an extra hour, which the management said would help sync production with the Hyderabad office.

The aggrieved employees decided to form a union to ensure collective bargaining rights. Eventually around 400 of the 556 staff members joined the union.

The protest in February was quickly followed by another standoff in April when the management terminated Azizur Rahman, an analyst with the Workplace team. Protests on the floor, however, failed to sway the management.

“I think they wanted to test the waters by sacking me,” Azizur Rahman said. “I was never given any reason for my termination. They made an example of me.”

When Accenture took over GPIT and Grameenphone’s IT support contract in 2013, the mood was optimistic.

Bob Sell, group chief executive of Accenture’s Communications, Media & Technology operating group, said in a statement: “We are excited to be investing in the largest IT services company in Bangladesh.”

He added that the “strategic investment” would allow Accenture to tap into a robust pool of skills and capabilities in the country.

However, Accenture’s GPIT deal was only a small part of a US$215 million global contract with Telenor to provide services in areas including Finance & Accounting, HR, IT and transactional purchases.

Under the global deal, Accenture’s Bangladesh office started working for several other Telenor subsidiaries including Telenor Pakistan, Thailand-based telecom operator Dtac, Malaysia’s Digi, and Telenor Global Shared Services (GSS), Telenor’s worldwide service center for Finance, HR & payroll, procurement and IT services.

However, the ‘local contract’ deal with Grameenphone was seen as the mainstay of the Bangladesh operation, since the ‘global contract’ work was spread out over several Accenture offices. Several current and former Bangladeshi employees said Accenture never grew the Dhaka office into a proper hub. The management of Accenture Communications Infrastructure Solutions Limited always looked to the Hyderabad office for guidance.

“The Dhaka office was a satellite,” a former employee said.

The Bangladeshi employees felt the Indian bosses did not fully understand the local work culture and many hankered after the ‘old days’ of GPIT under Grameenphone management. The management was frustrated by the union’s demands and viewed the employees’ increasing activism as a problem, a source said.

Tensions also grew between the sole senior Bangladeshi manager, CEO Raihan Shamsi and Chief Operating Officer (COO) Purushothama Kadambu. The friction between the two men led to the sidelining of Raihan who spent most of this year at Accenture’s Kuala Lumpur office, according to sources.

Raihan Shamsi declined to comment. Purushothama Kadambu could not be reached for comment.

The first real jolt to the Accenture Bangladesh business came last year when Telenor Pakistan decided to withdraw its work. At roughly the same time, Accenture was locked in negotiations with Grameenphone to increase service charges. After the negotiations failed, Telenor opted for an open tender for services, leading to the GP contract to be awarded to Wipro, a Bangalore-based Indian BPO company.

Grameenphone also reacted by creating an in-house unit to provide IT support, a move which analysts said reverted back to the ‘GPIT model’.

The loss of the GP contract was the final blow for Accenture. The management no longer saw the Bangladesh office as a viable business unit.

“It was easy for them to distribute the remaining work to the India offices,” a source said. “The management had no commitment to Bangladesh.”

Accenture PLC did not respond to requests for comment. A public relations firm working with the Bangladesh office, said in a statement: “Accenture, Telenor Group, and Grameenphone are working closely together to re-organise several engagements across Asia and Europe.”

Shahin Ahmed, general secretary of Accenture Employees Union, Bangladesh, said this left the Bangladeshi employees in the lurch.

“Many of us left Grameenphone to work for Accenture in 2013,” he said. “The future is uncertain for all of us now.”

Shahin called on the government to intervene, saying Accenture’s departure would send the wrong signal to the international BPO industry. He said: “No one will remember that Accenture left because the management here fell out with Grameenphone.

“All everyone will remember is that Accenture’s Bangladesh venture failed.”

http://www.dhakatribune.com/busines...inside-story-accentures-departure-bangladesh/

Why are we managing Accenture from Hyderabad? Why not from KL, Singapore or HK?

It is well-known that Bhartis are horrible managers.....especially lately with new 'Supa-Pawa' philosophy which pervades and neutralizes their professionalism.

Mallur Bacchader terek dekhani bondho na korley eta hobei.

 

[Bilal9]

^^^^ @gslv mk3

Few of the regular crowd just got their dreams of "BPO BD" blown away.



Now where have I seen this before?

Saale Bhag. Nikal Yahasey.

Pack your tutta-fatta bag and go back to Hyderabad Indian carpetbaggers.

Like we need Accenture business run by Indians.

Lesson to learn for Accenture.....

 

[Mage]

Taiwan shows interest to produce plastic raw materials in BD
FE Report


Taiwan has shown interest in investing in the country's plastic sector especially in producing raw materials required for the industry.

A visiting high-level Taiwanese delegation expressed the interest in a meeting with the leaders of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA) at its headquarters in the city Wednesday.

Headed by Taiwan External Trade Development Council chairman James CF Huang, the delegation is in Dhaka to explore the investment opportunities and relocation of their industries in the country, according to a statement.

Bangladesh's economy is growing faster in Asia and the country is a lucrative place for investment, BPGMEA president Md Jashim Uddin told the delegation.

Some 5,000 plastic factories across the country were producing a wide range of plastic products like PVC pipe, hangers, household items, toys, poly bags, furniture, woven sack bags and packaging items, he added.

The industry with an annual average growth rate of more than 20 per cent has created an employment for about 1.2 million, he said, explaining the opportunities to invest in the sector.


The BPGMEA president requested the delegation to invest in the sector especially in raw materials segment and relocate their machinery producing units here in the country.

He also invited the delegation to participate a three-day plastic fair scheduled to be held from January 31 next.

Expressing the willingness to invest in the country, Mr Huang said they were now exploring the market opportunity.

The delegation also informed that they were also interested in relocating some of their industries from China.

Former BPGMEA presidents ASM Kamal Uddin, Ferdous Wahed, Shamim Ahmed, senior vice president Giasuddin Ahmed and vice president Quazi Anwarul Haque, among others, were present in the meeting.

munni_fe@yahoo.com

http://www.thefinancialexpress-bd.c...terest-to-produce-plastic-raw-materials-in-BD

ICB for law forcing MNCs to go public

Syful Islam


The Investment Corporation of Bangladesh (ICB) has suggested enacting a law, making it mandatory for multinational companies (MNCs) to get listed on the bourses, sources said.

The proposal came in a paper prepared by the ICB as the Ministry of Finance (MoF) sought suggestions about ways to bring the MNCs in the bourses and make the secondary stock market a vibrant one, they added.

Experts opine that due to lack of quality shares, the stock market is not becoming vibrant and stable. Investors are confused and hesitant to make investment as a significant number of issues listed on the bourses have weak fundamentals, they added.

They said MNCs which have been making handsome profits for a long time can help meet the shortage of quality shares on the bourses. Divestment of shares of profit-making SoEs (state-owned enterprises) can also help in this regard.

According to the ICB, presently only 13 MNCs, out of 400, operating in Bangladesh are listed on the two bourses while only eight SoEs offloaded their shares in the markets amid repeated pressure from the government since 2009. These 13 MNCs hold 25 per cent of the total market capital.

As these MNCs pay handsome dividend every year, investors show much interest to invest in the shares of the companies.

Officials said there is no legal obligation that can force the MNCs to get listed on the bourses. However, the government has long been trying to bring the MNCs in the stock market.


The ICB also suggested offering special waiver for the MNCs to bring them in the stock markets. It said the MNCs can be listed on the bourses both by direct listing and initial public offering.

The ICB in its report named MNCs like Chevron, Unilever Bangladesh Ltd, Standard Chartered Bank, HSBC Ltd, Citi Bank N A, Siemens, Ericson, Mobil, Nestle, Avery Dennison, Youngone Corporation, Novartis Bangladesh, Coats Bangladesh Ltd, Grey Advertising Ltd, Asian Paints, ACS Textiles, MCC Transport, Hotel Amari, NewVision Solutions Ltd, RAK Paints, and CP Bangladesh, among others, which can be listed on the bourses.

Officials at the MoF said finance minister AMA Muhtih in late July sat with SoE bosses and asked them to step up their efforts in offloading shares. The minister will sit again with the SoE bosses and officials concerned in December next to follow up the development in this regard.

Meanwhile, the minister also sat with heads of some MNCs and foreign companies last month and discussed the issue of their coming to the bourses. The meeting also decided to seek written recommendations and suggestions from offices concerned on what steps could be taken for quicker enlistment of MNCs in the share markets.

Former chairman of Bangladesh Securities and Exchange Commission (BSEC) Faruq Ahmad Siddiqi told the FE earlier that divestment of shares of profit-making SoEs and listing of MNCs will help strengthen the markets with good shares.

The government will have to take bold steps to attract the MNCs in getting listed on the bourses, he said.

syful-islam@outlook.com

http://www.thefinancialexpress-bd.com/2017/08/23/80483/ICB-for-law-forcing-MNCs-to-go-public

 

[RISING SUN]

Bangladesh signs $59m hard loan deal with World Bank for power project
Bangladesh has signed a $59 million credit agreement with the World Bank to fund its power system development.

This is the first hard loan from the global lender for Bangladesh, with more than thrice the usual interest rate of below 1 percent.

The government signed the deal with the World Bank Group's International Development Association or IDA for the improvement of reliability and efficiency of the power system on Thursday.

Under the deal, Bangladesh will get the money from the IDA's scale-up facility on a 30-year term, including a nine-year grace period.

The interest rate for this credit will be 2.85 percent.

The interest rate for IDA credit from a fixed allocation is 0.75 percent for Bangladesh, a lower middle income country. As the amount of credit exceeds the allocation, Bangladesh is taking it from the scale-up facility.

After the signing of the deal, World Bank Country Director Qimiao Fan said the Power System Reliability and Efficiency Improvement Project will 'save $1 billion annually' for Bangladesh.

Fan signed the agreement on behalf of the global lender and Economic Relations Division Secretary Kazi Shofiqul Azam on behalf of the government.

Azam said the government needs 'extra financing' as its capacity of implementation had increased.

He also said the interest rate, however, was 'not much higher' considering the importance and outcome of the project.

Besides benefiting the government with fiscal savings, the project aims to lower greenhouse gas emissions by reducing the use of carbon-intense fuel in electricity generation.

The project will also construct and rehabilitate a 40-kilometre transmission line.
http://bdnews24.com/economy/2017/08...d-loan-deal-with-world-bank-for-power-project

Consortium to build 1.2 GW coal plant in Bangladesh
Sumitomo, Toshiba and IHI have together secured an engineering, procurement and construction (EPC) contract for the construction of 1,200 MW coal-fired power plant and a deep sea port in Bangladesh.

The contract has been awarded by Coal Power Generation Company Bangladesh.

Modeled on Kashima Port in Japan, a coal-fired thermal power plant and a deep sea port will be constructed at designated sites on Matarbari Island in southeastern Bangladesh.

The coal plant will consist of two 600 MW units and the power generated by the plant is expected to account for 10 per cent of the total generation capacity of the country.

Currently, the country generates around 65 per cent of its electricity using domestic natural gas as a source. To secure more reliable energy resources in the long term, Bangladesh is increasing generation capacity based on liquefied natural gas (LNG) and imported coal.

Financed under Yen Credit by the Japan International Cooperation Agency (JICA), the total project is estimated to cost JPY500bn ($4.58bn).

Construction on the project is scheduled to begin in August 2017 and is expected to be completed in July 2024.

Sumitomo will be responsible for civil work and auxiliary equipment as well as for port construction. Toshiba will deliver and install the steam turbines and the generators for the power plant. IHI will be in charge of providing and installing the boilers.
http://www.powerengineeringint.com/...to-build-1-2-gw-coal-plant-in-bangladesh.html

Bangladesh to need 30 million mt/year LNG imports by 2041
Bangladesh will need imports of around 30 million mt/year of LNG to meet mounting demand from various sectors including industries, power plants and fertilizer plants by 2041 as domestic gas reserves are depleting fast, according to Bangladesh’s Gas Sector Master Plan 2017, a senior Petrobangla official told S&P Global Platts.

Domestic natural gas production will peak at around 2.70 Bcf/d in 2017 before declining, the report said.

Bangladesh’s existing gas reserves of around 12 Tcf will be completely depleted by 2038 if no new exploration and discovery takes place, said the report prepared by Copenhagen-based research firm Ramboll in association with Geological Survey of Denmark and EQMS Consulting Limited.

Ramboll officially handed over the report to state-run Petrobangla this month, said the official.

The government has set a target to be a developed country by 2041 after achieving all necessary economic growth.

The report however, suggested for rigorous exploration activities in the onshore as well as offshore, which it said, could raise gas supply by 1.40 Bcf/d from about 5 Tcf of new reserves.

Bangladesh’s current natural gas production is hovering around 2.70 Bcf/d — the peak level stated in the report — against demand of close to 3.30 Bcf/d.

This supply shortfall has to be met by LNG imports, the report said. First LNG imports, equivalent to 500,000 Mcf/d of gas and corresponding to 17% of demand, are due in 2018.

This percentage is forecast to increase to 40% in 2023, 50% in 2028, and 70% in 2041.

Bangladesh is aiming to start LNG imports in early 2018 and is making concerted efforts to move forward with LNG import infrastructure, state-owned Rupantarita Prakritik Gas Co. Ltd. managing director Md Quamruzzaman told Platts Thursday.

RPGCL, a wholly owned subsidiary company under Petrobangla, is in charge of the country’s LNG purchases.

Bangladesh has already completed construction of its first dedicated 800,000 Mcf/d pipeline to move regasified LNG from Moheshkhali to end-users, and has three more in the works, state-run Gas Transmission Company Ltd. managing director Md Atiquzzaman told Platts previously.

The country’s first LNG import terminal, a 3.75 million mt/year floating, storage and regasification unit being developed by US-based Excelerate Energy, is expected to be commissioned in April 2018 and its second, also with a capacity of 3.75 million mt/year, being developed by Summit Group, is expected to be commissioned by end-2018.

Both will be located at Moheshkhali Island in the Bay of Bengal, with ownership to be transferred to Petrobangla after 15 years of operations.

Petrobangla is also planning to set up at least two onshore LNG terminals, each with a capacity of 7.5 million mt/year, by 2025.
http://www.hellenicshippingnews.com/bangladesh-to-need-30-million-mtyear-lng-imports-by-2041/

 

[ashok321]

Islamic banking grows in Bangladesh, no thanks to the authorities
The Economist · August 24, 2017


IN MOTIJHEEL, the main business district in Bangladesh’s capital, Dhaka, an iron fence and terrible traffic divide two branches of the country’s oldest private bank—a “conventional” one and an Islamic one. Abdus Sattar, manager of the Islamic one, says that when he joined AB Bank, in 2005, his was “a loser branch”. Today, like most Islamic banks in the country, it is more profitable and better run than its conventional peers. Islamic banking’s future in the country, however, remains murky.

Bangladesh has eight full-fledged Islamic banks; a handful of orthodox banks, like AB, also offer Islamic-banking services alongside others. Islami Bank Bangladesh, founded in 1983 by Saudi and Kuwaiti investors, commands 90% of Islamic-banking assets and deposits. It is also the biggest private lender overall, with 14,000 staff, 12m depositors and a balance-sheet of $10bn. Its success was built on the “two Rs”: remittances and ready-made garments. Islami Bank was a pioneer in financing Bangladesh’s rise as the apparel industry’s main production base outside China. It also runs the world’s biggest Islamic microfinance scheme.

Azizul Huq, a former vice-chairman of Islami Bank, thinks sharia-compliant banking will eventually outgrow the conventional kind (at present it controls just 20% of deposits). The population of 170m is 90% Muslim. The World Bank reports that only one in three Bangladeshis has a bank account. The government’s own polls show that Islamic banking is wildly popular, especially in the cities and among the young. Overall, 84% “approve” of it.

Ahsan Mansur, the executive director of Policy Research Institute (PRI), a think-tank in Dhaka, says Islami was the only bank where “bribery was not institutionalised”. At conventional banks bad loans to politically connected businesses have been piling up. Politicians seem to be encouraging nepotism: a new banking law will allow directors to stay on boards for nine years (up from six); and allow controlling families four members (up from two).

This month the central bank reported that net profits at conventional banks rose by just 4.9% over the year to June. Non-performing loans (NPLs) stood at 9.2%, compared with just 4.3% at Islamic ones. At nine of the country’s 57 banks, over 20% of loans were non-performing. The bad-loan problem may yet worsen as business struggles with stagnant exports: in the 12 months to June, garment exports expanded by 1.7% year on year, the slowest pace in 15 years. The central bank’s stress tests show that if the three biggest borrowers defaulted, 23 banks would fail.

In this context, Islamic banking might expect some official help. Far from it. The central bank has been sitting for years on applications from eight banks to change to an Islamic business model. It is yet to write rules for new sharia-compliant financial instruments, such as a sovereign sukuk, or Islamic bond. Islamic banks have no role in financing government projects.

Resistance comes from both the financial and political establishments. The central bank adheres to economic orthodoxy and is wary of a form of banking in which interest rates are nominally abolished. And the government of Sheikh Hasina, the prime minister, has long identified Islamic banking with the political opposition.

In January the government in effect instigated a boardroom coup at Islami Bank, which had been run by members of the biggest Islamic party. Ownership is now in the hands of those close to the prime minister’s family. This, too, may stunt Islamic banking. Bangladesh’s biggest successes —garments, microfinance and telecoms—are in industries where the government took a back seat. Since the takeover, the bank’s biggest institutional investor, the Jeddah-based Islamic Development Bank, has reduced its stake from 7.5% to 2.1%.

Mr Mansur of PRI notes that the takeover “clearly signals that assets in Bangladesh may not be safe in the future”. Islami Bank’s chairman, Arastoo Khan, insists it will bounce back, despite a record low 10% dividend in 2016 compared with a historic average of 21%, and rising NPLs. The future of Islamic banking in Bangladesh may hinge on whether he is right.

This article appeared in the Finance and economics section of the print edition under the headline "Against the odds"
The Economist · August 24, 2017