Bangladesh Economy: News & Updates

[EjazR]

Hasina eyes power from Bhutan :: Business :: bdnews24.com ::

Dhaka, Nov 07 (bdnews24.com)—Prime minister Sheikh Hasina, on a visit to Bhutan, has expressed interest in importing electricity from the Himalayan nation.

Hasina saw Bhutan's King Jigme Khesar Namgyel Wangchuck Saturday at Tashichodzong in Thimpu.

Hasina was also scheduled to meet Bhutanese prime minister Jigmi Y Thinley Saturday.

"Will Bhutan be able to export electricity to Bangladesh in the future?" Bhutan's English-language daily Kuensel asked on its online site.

"If Bhutan can export electricity we will be very happy to get it," Kuensel quoted Hasina as saying to the Bhutanese press.

Foreign minister Dipu Moni, accompanying Hasina to Bhutan, told bdnews24.com Thursday, before their departure, that Bangladesh wanted to "become involved" with production of electricity in Bhutan, an energy surplus country.

The tiny mountainous kingdom has the potential to produce up to 30,000 MW of hydro electric power, according to estimates of the South Asian Association for Regional Cooperation (SAARC).

Indian companies have so far been able to extract 10,000 MW from the country, most of which goes to India, experts say.

If Bangladesh and Bhutan reach an agreement on power, they must get Indian approval to make it successful.

The two countries would have to construct distribution lines across 50 kilometres of Indian territory for export of electricity from Bhutan.

Hasina also told the Bhutanese press after landing at Paro International Airport, "We want to enhance and develop the existing trade and business between two countries as Bhutan is a good neighbour of Bangladesh."

Bangladesh's exports to Bhutan is less than $1 million, and includes warm garments, computer accessories, dry food, pharmaceuticals, toiletries and textile items.

Bhutan's exports to Bangladesh totals around $14 million, according to the latter's commerce ministry figures. Bhutan's main export items are mineral products, foodstuffs, fruits, beverages and oat.

Hasina, Dipu Moni, industries minister Dilip Barua, commerce minister Faruque Khan, and others of a 28-member delegation landed in the Bhutanese capital Friday on a three-day official visit.

 

[eastwatch]

Hasina eyes power from Bhutan :: Business :: bdnews24.com ::

Bhutan has the potentiality to produce 30,000 MW of electricity, but it has little domestic market for this. BD wanted to invest in a Burmese hydro-electric project to get 70% of the production in that project. Burma is a hard nut to crack. Another harder nut is India. Will India readily agree to a transmission corridor from Bhutan to BD?

 

[eastwatch]

Financial Newspaper of Bangladesh
Chinese to win Dhaka-Chittagong 4-lane highway project
Munima Sultana

A Chinese company is set to win contract to build Dhaka-Chittagong four-lane highway after its bidding price beats offers from 18 other foreign and local firms, officials said Saturday.

Communication ministry officials said Chino Hydro has been primarily selected to build eight of the ten blocks in the Tk 24 billion 200-kilometre four-lane project.

"It is almost confirmed that Chino Hydro is getting the work for building the Dhaka-Chittagong four-lane highway," a senior official close to the bidding process told the FE.

The Chinese company's bidding price is lowest among the 18 companies that finally competed for the key project, the official said adding construction of the road would begin in December.

Three local companies are expected to construct the remaining two blocks in the road, which is the biggest road construction project in the country.

Officials said experts doing technical assessment of the project are now in China to evaluate the company's capacity and proposals and will report to the Cabinet's purchasing committee after returning home this week.

The bid winners will be formally unveiled later this month, after the post-evaluation report by the technical committee and subsequent approval by the purchasing committee.

The key government project initially attracted 27 companies from China, India, Malaysia and Hong Kong. Later, 18 companies took part in the final bidding closed on September 8.

The authorities have expedited the bidding process after it declared the Dhaka-Chittagong four-lane project one of its top priorities in view of increasing foreign trade through the Chittagong Port.

The port now handles more than 95 per cent of the country's US$ 37 billion foreign trade, most of which is transported into the country and outside through the Dhaka-Chittagong highway.

Some 90 per cent of the country's manufacturing companies are also situated on the Dhaka-Chittagong economic corridor, making the road the busiest in the country.

Plans to expand the highway into four lanes were initiated in 2004, when the country first clocked six per cent economic growth due to booming garment exports and remittance.

But biddings for the project were twice cancelled following allegations of unfair competition among the local companies. The government later amended its procurement rules, allowing foreign companies to take part in the bidding - allegedly under intense pressure by the donor agencies.

Officials said participation of foreign companies would ensure high standard of work, fair competition and transfer of technology and expertise.

Local companies have protested the government decision, arguing that they have already constructed big highway projects such as first phase of Dhaka-Chittagong four-lane project and Dhaka-Sylhet highway, maintaining high standard.

They also alleged that many foreign companies after winning bids have sub-contracted the projects to local companies, albeit devouring lion's shares of the profit.

"By contracting the work to a company from China, the government will in fact bring low standard technology," said one of the bidders of the four-lane project.

Government officials, however, rejected local companies' criticism, saying the Chinese company set to win the project has constructed many world class infrastructures at home and in developed countries.

 

[TopCat]

Cool.. last time local companies created a syndicate and bidded same amount for every block which in turn made the government to award one block per bidder.
I am impressed by the speed and transparency of the AL government.
I cant wait to see second Dhk-Cht expressway, metro rail, deep sea port and the newer airport. Once we start working on these projects our growth rate will hit 10% on a yearly basis.

 

[TopCat]

Bhutan has the potentiality to produce 30,000 MW of electricity, but it has little domestic market for this. BD wanted to invest in a Burmese hydro-electric project to get 70% of the production in that project. Burma is a hard nut to crack. Another harder nut is India. Will India readily agree to a transmission corridor from Bhutan to BD?

Bhutan is a very resourcefull and potential coutnry. They could not grow due to India's reluctance to let them to go along with other countries. They are basically locked by India. BD is the only 2nd country from where they are asking for FDI. If they want to prosper they must get connected with BD and get out of India's monopoly.

 

[eastwatch]

Bhutan is a very resourcefull and potential coutnry. They could not grow due to India's reluctance to let them to go along with other countries. They are basically locked by India. BD is the only 2nd country from where they are asking for FDI. If they want to prosper they must get connected with BD and get out of India's monopoly.

Because of India's small-mindedness I do not like India. India is always self-centered and is always jealous about all its neighbours. Instead of extending a helping hand towards it landlocked poor neighbours, it tries to bite their hands. Nepal and Bhutan are real unlucky countries surrounded by a rockhard big neighbour.

I think, BD will be able to crack open Indian corridor so that the two small countries can freely do external trades with and via BD.

 

[leonblack08]

Foreign apparel makers plan relocation to Bangladesh
BATEXPO ends amid warm response from buyers


A woman picks clothes on display at the 20th BATEXPO-2009, organised by Bangladesh Garment Manufacturers and Exporters Association in Dhaka. The three-day fair that pulled in warm responses from international buyers ended yesterday.Photo: Anisur Rahman
Refayet Ullah Mirdha

Foreign buyers see Bangladesh as a lucrative destination for global apparel outsourcing as the country manufactures quality items at a cheap cost.

Many entrepreneurs now plan either relocation of their factories or venturing into joint business here, they said while narrating their experience as participants in the 20th BATEXPO in Dhaka.

The annual largest apparel exhibition concluded yesterday. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) organised the three-day fair. A total of 62 companies from home and abroad participated in 86 stalls.

Talking to The Daily Star at his stall, Gao Zhourong, marketing manager of Changzhou Giantsun Textile Company Ltd, a Chinese company, said they will set up a garment unit in Bangladesh soon as this is a good place for cheaper labour cost.

"We have already completed talks with a local partner to set up the garment unit," Zhourong said.

Currently, this company has been supplying fabrics of woven garment in Bangladesh, he said. He thinks the response from local and international buyers was very high at the BATEXPO.

Bangladesh imports a substantial quantity of such fabrics from China as the local backward integration can only supply 35 percent of the total demand.

However, the local textile millers have been able to supply around 80 percent fabrics for the knitwear sub-sector for setting up of strong backward integration over the last few years, mainly backed by the GSP (Generalised System of Preferences).

Agha Dastageer of Kassim Textiles, a denim manufacturing company from Pakistan, said Bangladesh's export trends show a huge rise in orders from importers in future.

He said Bangladesh is doing well also in denim manufacturing as many companies have already started exporting fine denim products.

Dastageer said the quality of Bangladesh made apparels is better compared to other competitive countries as the country mainly depends on the European machinery. "European machinery is really good for apparel manufacturing. And Europeans like such quality," Dastageer said.

But Bangladesh is suffering limited products diversification as the country still mainly manufactures basic items, the foreign apparel businessmen said.

Meanwhile, the local makers said orders from international buyers are on the rise, as the world is coming out of recession with the signs of improvement in the advanced economies.

Golam Ahmed, general manager (product) of Intramex Group, a local firm, also pointed to the upward trend of buying orders saying that foreigners are coming to Bangladesh in large numbers.

He suggested that Bangladesh should focus on product diversification in a bigger way, as buyers always demand some new items.

Meanwhile, a considerable number of foreign investors and buyers flocked to the recently concluded 5th Knitexpo in the capital. A record 156 international buyers and investors attended the show, held at Dhaka Sheraton Hotel on November 2-4.

Bangladesh exported $5.918 billion woven garment and $6.429 billion knitwear products in 2008-09 fiscal year, the Export Promotion Bureau (EPB) data said.

Foreign apparel makers plan relocation to Bangladesh

 

[idune]

BATEXPO spot orders down 30pc from last year

Sun, Nov 8th, 2009 9:54 pm BdST

Dhaka, Nov 8 (bdnews24.com) -- Spot orders from buyers at this year's BATEXPO, the country's largest apparel fair, fell 30 percent from last year, according to the industry's top trade body.

Spot orders at last year's expo amounted to $55.45 million; this year they totalled just $41.64 million, BGMEA president Abdus Salam Murshedi told a press briefing Sunday.

On the reason behind the fall in orders, he said buyers are seeking lower prices.

"Buyers say prices are much lower in other countries," said Murshedi.

He said production costs had risen at home due to gas and power crises, mismanagement at Chittagong port and high rates of interest as well as bank charges.

Exports of readymade garments in the first quarter of the current fiscal dropped by 9.71 percent compared to the same period last year, he added.

"Exports for the month of September fell by 26.93 percent from the same month last year."

Meanwhile, the government has set export targets for woven and knitted garments at $17.6 billion this year, which is 13 percent above last year's target.

Fearing further fall in exports in October, Murshedy told reporters the crisis can be averted if the government comes up with "policy support".

The three-day BATEXPO 2009, of the Bangladesh Garments Manufacturer and Exporters Association, ended on Saturday.

According to BGMEA, 62 organisations hosted 86 stalls for buyers from UK, US, Canada, Middle East, Hong Kong and Japan.

BATEXPO spot orders down 30pc from last year :: Bangladesh :: bdnews24.com ::

 

[eastwatch]

South Asian Media Net

ConocoPhillips wants 8 offshore blocks
Monday, November 09,2009

DHAKA: The signing of the Production Sharing Contract (PSC) under the 3rd round bidding hangs in the balance as the US based ConocoPhillips, which was awarded only two blocks although they were competing in eight blocks, recently informed the government that it wants to sign the PSC on all the eight blocks.

The 3rd round offshore bidding opened during the last caretaker regime on 22 offshore blocks. A total of seven International Oil Companies (IOCs) submitted their bid documents on nine blocks. The ConocoPhillips was competing in eight blocks and the Tullow was competing in only one block.

Recently, the ConocoPhillips wrote a letter to the secretary, energy division, reiterating their earlier position about signing of the PSC on all the eight blocks for which they were competing. They did not drop any word about the signing of the PSC on the two blocks.

Following the ConocoPhillips' letter, the US ambassador in Dhaka met the Petrobangla chairman Prof Hossain Mansur and urged him to award all the eight blocks in favour of the ConocoPhillips, the source said.

An evaluation committee headed by Dr. Moqbul Elahi recommended awarding eight blocks in favour of the ConocoPhillips and one block in favour of the Tullow.

After the declaration of the bid result Myanmar and India lodged protest against the third round bidding on the plea that a number of blocks overlapped their territory.

In view of the neighbours' protest, the government decided to put off the competitive process on all the disputed blocks and approved the award of two blocks in favour of the ConocoPhillips and one block in favour of the Tullow.

Following the government's decision the Petrobangla, country's lone hydrocarbon management organization, invited both the ConocoPhillips and the Tullow to sit across the table for negotiations, which ended in the first half of the last month.

At the negotiation table, the US oil company expressed their willingness to sign the PSC on all the eight blocks for which they was competing.

The Petrobangla negotiation team explained the difficulties in signing the PSC without demarcation of maritime boundary with Myanmar and India. They were also told that the government had taken initiative to resolve the maritime boundary issue and Dhaka had already sought the UN arbitration in this regard.

But the negotiation team of the ConocoPhillips left the country without saying 'yes' or 'no' to the government decision of awarding the two blocks.

The energy division informed the highest level of the administration about the latest development on the 3rd round bidding and sought policy direction in this regard. But till the day, the energy division did not receive any directives from the highest level of the administration, the source added.

The ConocoPhillips was competing in blocks 10, 11, 12, 17, 15, 16, 20 and 21. But the government awarded them blocks 10 and 11 only.

 

[leonblack08]

Good news

TigerIT ranks first in US competition
Star Business Report
TigerIT Bangladesh Ltd, a local IT firm, ranked first in the minutiae interoperability exchange test by US-based National Institute of Standards and Technology (NIST).

The purpose of the Minutiae Interoperability Exchange Test (MINEX) is to determine the feasibility of using minutiae data as an interchange medium for fingerprint information between different fingerprint matching systems.

This is recognition for Bangladesh for developing identity (ID) management, which may help local IT companies to get works from the global market, said Ziaur Rahman, chairman and chief executive officer of TigerIT Bangladesh.

"This recognition means we are the best in some sectors, such as making national ID cards and machine readable passports," he said.

MINEX is designed to evaluate whether various populations and combinations of encoding schemes, probe templates, gallery templates and fingerprint matchers will produce successful matches.

The recently published NIST test results revealed that a combination of the Tiger's AFIS (automated fingerprint identification system) enrolment template generator and the matcher showed false non-match rate of 0.06 percent at a fixed false match rate of 0.01 for two fingers.

It outperformed Japanese NEC's 0.08 percent, US-based Cogent's 0.11 percent and France's Sagem 0.12 percent.

TigerIT was earlier ranked second by NIST for developing an automated fingerprint identification system with high accuracy.

TigerIT ranks first in US competition

 

[eastwatch]

You are right. Express way and train track shoud be separated venture. But we must need underground as if you had circular rail and all how you could get to the center of the town. Also if you want to 100% discourage privately owned car then you have to follow New York model where a person is always in walking distance from a subway station. In addition to subway we also need circular rail, Gajipur-Dhaka-Narayanganj expressway etc.

I agree with the writer of the essay below that BD should not try to build something that only benefits the builders and contractors. I also believe that an underground system is too expensive to build and will be too difficult to run with inefficient people of BD.

Morever, the ticket prices for an underground system will have to be subsidized. A too costly building expenditures require a very high prices for the commuting tickets. If people can ill-afford the fare, then it will have to be susidized. It means it will be a total mess. Even if foreign companies are asked to build and operate an underground system, they will shy away from it because the govt may not accept their offer of high rates of train fares.

BD govt should see thing in its proper perspective. It should solve the present traffic jam by building overhead railway track wherever a train line crosses a busy main road. An 8 metre high railway track will help, although it will not solve all the traffic problems. Even a 500 metre long section over a road will take a few years to build. Almost one year has passed after the election, but any one can notice the talk-only attitude of this govt.

Only in the 2nd step, the govt should decide on the commuting train system among many destinations inside or in the suburbs of Dhaka. Instead of doing any real work, the present AL govt is fond of showing us dreams. Well, these dreams will keep the population in sleep for a few more months, but once they are awake with shattered dreams, they will kick it out very quickly.

Heed reasonable advice on mass transit for Dhaka

 

[eastwatch]

Economy IIInvestment lull seen as 'biggest challenge' :: Bangladesh :: bdnews24.com ::

Investment lull seen as 'biggest challenge'
Sun, Nov 15th, 2009 7:28 pm BdST
Abdur Rahim Harmacchi
bdnews24.com senior correspondent

Dhaka, Nov 15 (bdnews24.com) — As some indicators go from strength to strength, an alarming inertia persists in both local and foreign investment, while idle funds risk raising inflationary pressures.

The finance minister, central bank governor and the country's economists all echo the same concern, that the biggest challenge for the Bangladesh economy is to divert huge amounts of excess liquidity into productive investment.

At the start of the year, low investment in the country was a legacy of a two-year period of emergency coupled with the caretaker government's anti-corruption crackdown against businessmen, among others.

But business leaders and economists point out that those particular investment barriers disappeared with the newly elected government taking the reins in January this year.

And yet stagnancy in investment still prevails with the year ending, they sayThey also hold that inertia in investment will persist unless there are improvements in infrastructure, bureaucratic complexities and law and order.

Finance minister AMA Muhith has acknowledged the challenges ahead in a recent speech in parliament.

He told bdnews24.com this week, "Investment stagnancy still persists mainly due to two reasons: one is the installation of a new government and so local investors are still taking a 'wait and see' approach."

The other is global recession which has dampened overseas investment, he said.

"So we are focused on wooing local investors, as foreign investors will stay clear until local investment is revamped," he said.

Poor local investment has been reflected in falling imports of capital machinery and raw materials for industry. Both fell by 22 percent during the first quarter. But Bangladesh Bank has said productive imports have been on the rise again from September, though it has yet to release figures.

Foreign Direct Investment dropped to $126 million during July-August of the current fiscal year, while the figure hit $201 million during the same period of last fiscal year.

Figures available up to August indicate that loan disbursement in to the private sector had not improved during July-August period; rather it marks a decline.

Meanwhile, just 10 percent of the Annual Development Programme was implemented during the first quarter (July-Sept).

FBBCI president Annisul Haq said, "Local investment will not rise unless gas and electricity crises, stifling bureaucracy and high interest rates are addressed."

He urged the government to pay attention to the issues.

Former commerce minister Amir Khasru Mahmud Chowdhury believes there are other issues too.

"Gas and power crises are not the major issues. Rather, law and order insecurity mainly stands in the way of investment."

Muhith said, "We have already launched steps to combat high interest rate and bureaucratic complexities which are a major hurdle to raise investment"

"We are moving to address the gas and electricity crises," he said.

The government is also taking measures to ensure industrial security.

Muhith was also optimistic as import of capital machinery showed a rise in September.

"This is undoubtedly a good sign, which indicates that investment is about to pick up," he said

Bangladesh Bank governor Atiur Rahman also told bdnews24.com that the wheels of investment were turning again.

He said, positive signs were apparent in industrial and service sectors alongside agriculture.

Along with capital machinery, imports of raw materials are on the rise as are large loans, he said.

Rahman has also suggested that part of the

A joint survey launched by Bangladesh Investment Climate Fund and International Chamber of Commerce-Bangladesh indicates that though the first three quarters of the calendar year (Jan-Sept) saw low business and investment, the last quarter (Oct-Dec) is expected to see one-third growth.

The BIF-Bangladesh Business Survey 2009: Reflection of Opinions of Businessmen, released on Nov 5, interviewed 778 business firms in different parts of the country from July-September.

Former caretaker adviser Wahid Uddin Mahmud said different sectors of economy including investment are slow-moving due to diverse problems.

But he welcomed the view of businessmen in that the sluggish trend was lifting toward the end of the year.

The finance minister said, "Investment inertia resulting from intimidation and harassment of businessmen by the last care-taker government is yet to lift."

We are trying to overcome the slump down and expecting to overcome it at the beginning of next year.

 

[eastwatch]

ANTARA News: Japan`s KDDI to take 50% stake in top Bangladeshi ISP

Japan`s KDDI to take 50% stake in top Bangladeshi ISP
Friday, November 13, 2009 15:03 WIB | Economic & Business |

Tokyo (ANTARA News/Asia Pulse) - Japan's KDDI Corp. (TSE:9433) said Thursday that it will acquire a 50 per cent interest in leading Bangladeshi Internet service provider BRAC BD Mail Networks Ltd., or bracNet.

KDDI will purchase all shares to be issued by bracNet in a private placement for roughly 800 million yen (US$8.85 million) and convert the firm into an equity-method unit.

The acquisition is expected to be completed in January. BracNet was established in 1996 jointly by a U.S. investment fund and a Bangladeshi nongovernmental organization.

It has been building a network based on the WiMAX wireless data communications technology and operating 110 stores that offer Internet access for a fee.

 

[eastwatch]

Adidas plans Bangladesh project
Kazi Azizul Islam

German sport-goods giant Adidas has under taken a project to produce low-cost trainers for poor buyers, a London-based newspaper reported on Tuesday.

Quoting an Adidas spokesman, the newspaper stated that the project was undertaken after being convinced by the noble laureate and founder of Grameen Bank, Mohammad Yunus.

Jan Runau, the Adidas spokesman, told Daily Telegraph that an agreement had been signed to begin production of the shoes in Bangladesh next year. He, however, said that the project was at an early stage and it had not yet been decided whether the shoes would carry the Adidas tag.

Jan also said Adidas is to make trainers [active shoes] at the price of one Euro per pair for millions of people around the world who can not afford to buy shoes. Pilot production would begin next year in Bangladesh, he said.

Adidas usually makes expensive footwear and celebrity sponsorship but, according to the Telegraph, [Bangladesh] project was inspired by Muhammad Yunus, the pioneer of micro-loans which help the poor start their own businesses.

He [Yunus] told the company [Adidas], which has been criticised for exploitation in the developing world, that Bangladesh needed 壮ocial businesses・which would create jobs in the country.

It is correct that Adidas Group in conjunction with Muhammad Yunus aims to put such shoes on the market,・he said.

The company has now agreed it will produce shoes in Bangladesh on a non-profit basis, although a spokesman stressed the final price may be higher than the €1 (89 pence) target.・The Telegraph wrote.

Adidas pays former England football captain David Beckham ｣3 million per year as a brand ambassador and to use his name to promote their Predator football boots, which sell for ｣130 a pair. It spent a reported ｣50 million to sponsor the Beijing Olympics last year and has pledged a further ｣100 million for the London Olympics in 2012.

He said it had not yet been decided whether the shoes would carry the Adidas brand or its trademark three stripes design, 銭ey decisions on design and branding have yet to be finalized.・

 

[TopCat]

Good going.. Social business the idea of Bangladesh is taking hold in the world arena too. Only Telenor could not learn but knew about only profits.