Bangladesh Economy: News & Updates

[Justin Joseph]

India to allow Nepal, Bhutan access to Bangladesh ports

Dhaka, Aug 8 (bdnews24.com)--Foreign minister Dipu Moni has revealed that India would allow Nepal and Bhutan utilise Mongla and Chittagong ports to export their products to other countries.

Briefing journalists at foreign ministry on Sunday, Moni said the Indian government would also finance a railway project from Khulna to Mongla port.

"Khulna-Mongla railway project will also be implemented," Dipu Moni said in reply to a question from bdnews24.com correspondent, when asked whether New Delhi will provide grants to build the new railway tracks, which will directly connect Dhaka with the Southwestern port.

Bangladesh Railway had already sent a proposal to the Indian government to construct the 76 kilometres rail tracks with grants, not loan.

She said Delhi would also let Bangladesh connect with Nepal via India.

"Yes, they will allow Nepal and Bhutan to do third country trade," Moni told reporters.

"Signing of new deals is not necessary for third country trade and can easily be done through a letter of exchange," she said, adding that the matter was addressed in her meeting with the Indian finance minister Pranab Mukherjee on Saturday.

She said prime minister Sheikh Hasina during her Delhi visit in January this year talked with her Indian counterpart Manmohan Singh for allowing Bangladesh to trade with Bhutan and Nepal through Indian territory.

"India will also allow us to connect with Nepal by railway via Indian territories," Dipu Moni said.

Railway sources said it also forwarded a proposal to the Indian government for its connectivity with Nepal through India.

As per the proposal, Bangladesh sought Indian nod for carrying products to and from Raxaul (India-Nepal border) via India's Jogobani.

Dipu Moni said she discussed the issue with Pranab Mukherjee too.

India to allow Nepal, Bhutan access to Bangladesh ports | Business | bdnews24.com

 

[bd_4_ever]

Software export earns $34m last fiscal

The country earned US Dollar 33.5 million by exporting software and the IT-enabled service (ITES) in the last fiscal year, which is slightly up from that of the previous fiscal.

"The country fetched US Dollar 33.5 million by exporting software and ITES in the last fiscal year, which is US$.50 million higher than the 2008-2009 fiscal," Mahbub Zaman, President of Bangladesh Association of Software & Information Services (BASIS), told BSS on Wednesday.

He said though the country's earnings from software and the IT-enabled service (ITES) slightly increased but not to the desired level as the sector suffered a setback due to global economic recession.

"The software and ITES export to America and Europe, the main market of Bangladeshi software, reduced to a great extent due to global economic meltdown," Zaman said.

Against this backdrop, he said, they are now focusing on the markets in Asia and Africa, where Bangladeshi software and ITES have immense potentials.

Zaman said lack of infrastructure, resources and submarine cable line are the main barriers to the expansion of the country's software and ITES market.

He stressed the need for setting up more high-tech parks along with increasing submarine cable line in the greater interest of expanding the country's software market.

The BASIS president said they sought the government help to set up a software park at Janata Tower, an abandoned building at Kawran Bazar in the city.

Quoting a World Bank study, Shameem Ahsan, chairman of International Market Development of BASIS and a member of Digital Bangladesh Taskforce, said the country can earn US$ 500 million by the next four years if the existing problems in the software sector are solved.

He laid emphasis on appointing a foreign consulting firm for framing an ICT roadmap and setting up marketing desks at Bangladesh missions in New York, London and Copenhagen for expansion of the country's software market.

According to a survey conducted by BASIS recently, the average yearly growth rate of software and ITES industries in Bangladesh is over 40 percent and this growth rate is expected to continue during the years to come.

"This rapid growth is supported by good software export trends and large demand for IT automation in domestic market," the survey said.

Recently in Bangladesh, it said, large-scale automation projects have been implemented in telecom, banking, finance, pharmaceutical, and garment/textile sectors and domestic demand for software and ITES industries are, therefore, expected to go up rapidly.

The survey said more than 500 software and ITES companies are registered in Bangladesh now. "These companies employ over 12,000 ICT professionals and the average number of employees in the industry including ICT professionals is 50," the survey said.

It said the size of the IT market excluding telecom in Bangladesh is estimated at US$300 million in total.

The survey said there are about 500 software and ITES companies in Bangladesh, of which more than 100 companies are exporting their products and services to over 30 countries of the world.

"The major export market is North America, but recently many IT companies started exporting to EU countries and East Asian countries, especially to Japan," it said.

The survey said at least 30 companies out of 100 that export their products have been established through joint-venture with overseas companies or as an offshore development centre (ODC) by 100 percent foreign capital.

"Most of these companies started their operation within last two to three years, indicating that the Bangladesh software and ITES industries have started to be focused by overseas buyers," it said.

The survey said Bangladesh has high potential to become a huge source of skilled human resources with its cultural adoption capability, English language skills, analytical capability and a large number of educated and energetic youths with bright aptitude, quality and natural ability in software development.

It mentioned that European Union has ranked Bangladesh as one of the top 20 outsourcing destinations in the world.

"With tremendous potential yet to be exploited, it is anticipated that the global sourcing phenomenon will continue to expand in scope, range and geographic coverage," it said.

The New Nation - Internet Edition

 

[bd_4_ever]

Country achieves 4.11pc export growth

Commerce Minister Lt Col (retd) Faruk Khan on Tuesday said the country has achieved 4.11 percent export growth last year at a time when many countries couldn't shrug off global financial recession.

Chartered Accountants (CAs) had played an important role in achieving the export growth, he said and hoped that they would play a significant role by ensuring transparency and accountability under financial reform in the future.

Faruk Khan was speaking at the closing session of an international conference of Chartered accountants at a city hotel yesterday. Institute of Chartered Accountant of Bangladesh (ICAB) organized the conference, joined, among others, by chartered accountants from SAARC countries.

He listed various steps taken by the government including smooth supply of utilities, traffic management and increasing infrastructure development.

The commerce minister called upon the CAs to maintain international standard while performing their duties.

The New Nation - Internet Edition

 

[bd_4_ever]

Investment, employment notably increased in EPZs

Despitethe severe world economic recession the volume of investment and employment has notably increased in all eight Export Processing Zones (EPZ) of the country in the outgoing fiscal(2oo9-2010).

Highly placed sources said the investment in the EPZs has increased by nearly 48 percent while employment opportunity shot up by about 80 percent following the investment friendly environment and resumption of production in nearly 200 closed industrial units as political stability existed in the country.

Chittagong EPZ topped the enhancement of the employment opportunity among eight EPZs of the country in the fiscal (2009-10), compared to the corresponding period of the previous fiscal year.

Bangladesh Export Processing Zone Authority (BEPZA) sources said a total of 22 crore 20 lakh dollars was invested in Dhaka, Chittagong, Mongla, Ishwardi, Comilla, Adamjee, Uttara and Karnaphuli EPZs in the last fiscal (2009-2010) while the investment was 15 crore dollars in the previous fiscal 2008-2009.

BEPZA source said increase in production of the old industries, expansion of new industries and huge demand of ready-made garments in the developed countries drew more investment in the second half of the previous fiscal and created huge employment opportunities.

The EPZs created employment opportunities for about 28064 people of which 12172, a record number, were employed in Chittagong EPZ alone in the last fiscal while the same was 16103 in 2008-2009 fiscal.

The sources also said that the investment in the EPZs has been increasing by leaps and bounds since the fiscal 2006 -07.

Talking to BSS BEPZA Chairman Brigadier General (rtd) Jamil Ahmed Khan said the huge export orders of the garments in the world market increased both investment and employment opportunities in the EPZs. The Chairman said the world economic recession did not affect Bangladesh's market as investment friendly environment and political stability existed in the country.

The New Nation - Internet Edition

 

[bd_4_ever]

A bit old....but still posting it....

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Cheers!!!

 

[Time Assassin]

Bangladesh has economy? OMG when did this happen. LOL Joking, i heard Dhaka is doing well for itself, but the population of Bangladesh is extremenly high.

BTW according to the World Bank Bangladesh will be the 22nd richest country in the World by 2050.

 

[Maira La]

<Time Assassin: Bangladesh has economy? OMG when did this happen. LOL Joking, i heard Dhaka is doing well for itself, but the population of Bangladesh is extremenly high.>

Hey bro, population is actually one of our big assets. We just need to turn all the unskilled labor -> skilled labor and then the economy will "boom!".

<Time Assassin: BTW according to the World Bank Bangladesh will be the 22nd richest country in the World by 2050.>

Yeah BD is supposed to be one of the "Next Eleven", which includes PK as well.

 

[CaPtAiN_pLaNeT]

BTW according to the World Bank Bangladesh will be the 22nd richest country in the World by 2050.

Bangladesh's economy may grow even bigger than that as in the prediction they have assumed bangladesh will grow on an average only at the rate of 5-6% per year.

For example, in the case of turkey they have assumed that turkey's economy will be around 3.6 trillion dollar but in reality it will be around 6-6.5 trillion under current estimate and will be 8th or 9th largest economy.

Same also goes for bangladesh. The big question is that whether bangladesh will be able to match india in terms of per capita gdp by that time. If so, I would say that will be a big achivemant and for that case bangladesh's economy will be around 5-6 trillion dollar with per capita gdp of 20000 USD and with around 300 million people. But lots of hard work need to be done, education must be provided to all, electricity generation must match with demand. Lets hope for the best. It is expected bangladesh by 2017 will achive 10% GDP growth. If this happens then achieving the target will not be that tough.

 

[idune]

Bangladesh's inflation is picking up as food prices spike

DHAKA -- Bangladesh's inflation is picking up again as food prices rise, a concern for the government as nearly 40 percent of the country's population live on less than US$1 a day. The central bank said it aimed to tackle inflation but economists said that monetary policy would have little direct affect at controlling food prices in the country of more than 150 million people.

The Bangladesh Bureau of Statistics said consumer prices rose in May by 8.65 percent from a year earlier, the highest level since March. Inflation had been coming down for two straight months since hitting more than 9 percent in February.

Average 12-month inflation in May rose to 6.78 percent from 6.51 percent in April, running above the government's target of 6.5 percent.

Food prices in May shot up 10.72 percent from May 2009, picking up from a 10.47 percent rise in April's data.

In contrast, non-food inflation eased to 5.34 percent in May from 5.46 percent in April.

“Measures are being taken to tame inflation,” a senior central bank official said.

Bangladeshis living on less than US$1 a day tend to spend roughly 70 percent of their income on food, so rising prices can have a dramatic impact.

Rice prices have risen over the past few months despite a record crop, which analysts have attributed to hoarding by middlemen and a lack of control over the market from the government.

The central bank raised bank reserve requirements by 50 basis points to 5.5 percent from mid-May, its first increase since October 2005 as it shifted its focus to battling inflation.

The central bank slashed both the repo rate and the reverse repo rate by 4 percentage points to 4.5 percent and 2.5 percent, respectively, in late 2009 to protect the economy from the fallout of the global financial crisis.

Inflation has been creeping up since it hit 2.25 percent in June 2009, the lowest level in more than seven years.

Rural inflation hit 8.91 percent in May from 8.77 percent in April while urban inflation edged up to 8.01 percent from 7.95 percent in April.

Bangladesh's inflation is picking up as food prices spike - The China Post

 

[CaPtAiN_pLaNeT]

Enticing investments in power sector News Analysis

Shahiduzzaman Khan

Since taking over office, Prime Minister Sheikh Hasina met the power and energy officials for the third time so far including the one held this week and expressed her resentment over 'slow' pace of project works in the ailing sector. She asked the officials to intensify drive for implementing the power and energy sector projects in time. She said the existing policies and rules can be amended, if necessary, to pave the way for quick implementation of projects in the sector.

According to reports this week, the Prime Minister told the authorities to encourage local private entrepreneurs to invest in the country's ailing power and energy sector. Many local firms are showing interest to invest in power and energy sector. Summit, Energypac, ITC Group etc., are some of them. If attracted, local private investments would help prevent the flight of foreign currencies in the form of profit repatriation, it is expected.

Meanwhile, the power supply crisis has badly affected the lives of the people. The economy has been forced to pay a heavy toll. The supply-side situation has meanwhile continued to remain in a critical shape in the context of the backlog of a huge demand-supply gap and also of fast-growing domestic demand. The output of gas and electricity did not increase much in the past seven years. The present government has finalised a road-map to generate around 9,426 megawatt (mw) of electricity by 2015. Some 571 mw of electricity could be added to the national grid during the past one and a half years, according to reports. The demand for growth of electricity is outpacing the additional generation. At present, the power generation capacity is over 5,000 mw, but the everyday actual generation stands at 3800-4100 mw due to technical glitches and gas crisis.

Reports say the Power Division is now devising ways and means to attract capital from both external and domestic sources for investment in the next two decades. Ensuring reasonable and affordable price for electricity by pursuing least cost options, making the power sector financially viable and having a mix of concessional capital and foreign direct investment (FDI) are among the reforms the Power Division is undergoing with a view to enticing power sector investments. A number of road shows were organised both at home and abroad in recent months to attract investments, particularly foreign ones, to the power sector.

Finance Minister AMA Muhith recently said that the funds for implementing power and energy projects would not be a problem as the sector was on top of the government agenda. He just wanted a firm commitment from the stakeholders -- both public and private -- for coming out of the current 'catastrophic' power and energy crunch. The government is exploring all sorts of alternatives to exploit the use of coal, natural gas, hydro, liquid-fuel, liquefied natural gas (LNG), liquefied petroleum gas (LPG), nuclear plants etc., to resolve the energy crisis.

Installing new coal-fired power plants, importing electricity from power-rich neighbouring countries and setting up nuclear power plants are among the planned avenues the Division is now considering for implementation. Exchanging electricity with the bordering countries during off-peak and peak hours and establishing joint venture power plant projects with them are also in the division's action strategy. The potentials of renewable energy such as solar power, wind power and power generation from solid wastes are also being reportedly explored to enhance electricity generation for future needs.

As such, comprehensive institutional arrangements do need to be put in place for addressing the financing challenges in the urgently needed power sector investments in Bangladesh, of course with scope for further development and expansion as needs expand. For this, energy and finance ministries, Bangladesh Bank (BB) and Board of Investment (BoI) will have to work in close co-ordination to ensure flexibility and responsiveness of the available arrangements to the needs of undertakings of various sizes and types. Regular periodical contacts and consultations of these authorities with power sector entrepreneurs and the financing community will also be important in tracking and promptly addressing the needs and issues as they arise.

For a plan to install 7000 megawatt worth of power by the year 2014, financing worth of US$ 10 billion dollars will be required. This will be the avenue for the biggest opportunity being opened up for the private sector investment since the country's independence. In addition, once the government gives the go-ahead for the much-awaited coal policy -- the draft of which is being discussed for the last few years -- the country's coal sector would also open up multi-billion dollars worth of investment opportunities for the private sector over a long period of time.

Local entrepreneurs are largely of the view that ensuring public confidence will be critical to attracting investors to areas where risks have to be taken in costly ventures. If the tendering process does not appear fair, genuine bidders will gradually refrain from participating in the bids, leaving all the jobs to inept contractors who would not be able to deliver the desired results.

It is not that the government's investment policy or incentive-package that alone lures foreign investors. The investors take into consideration many other factors before deciding to come to a country. Factors such as macro-economic stability, economic governance, infrastructure, costs of doing business, political stability and law and order do also figure prominently in the minds of an investor. They also take into consideration seriously the experience and the mood of the private sector of a country before making a final investment decision.

Enticing investments in power sector

 

[CaPtAiN_pLaNeT]

$1b earning a year likely from transit, transshipment treaties Economy will benefit, says FBCCI chief

FE Report

Bangladesh can earn at least US$ 1.0 billion a year initially following signing of transit and transshipment treaties with India, FBCCI chief said Wednesday.

He said Bangladesh will earn this large amount of money from sources including transit fees, port levies, bank commissions, transportations and customs clearing and forwarding charges.

"Our economy will benefit from the transit. It will give a boost to our economy," AK Azad told the reporters.

President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) said this at a press briefing on transit, transshipment and $1.0 billion finance by India held at its office in the city.

Mr Azad said this (transit and transshipment) will help reduce the country's the trade gap with India, which is heavily in favour of the neighbouring country.

Bangladesh imports goods worth around $3.8 billion a year from India and exports nearly $ 250 million, he said.

FBCCI chief said India will allow duty-free entry of further 8.0 million pieces of garment from Bangladesh.

Bangladesh has already exported 5.0 million pieces of garment to India as against 8.0 million allowed earlier.

Mr Azad said Bangladesh's business with Indian north-eastern states will expedite following the transit facility saying: "The transit and transshipment facility will open a new era for Bangladesh's manufacturing sectors."

Captain Imam Anowar Hossain, chairman of Asian Lubricants, told the reporters that Bangladesh might be a 'financial hub' following the transit facilities.

"Consignees from India, Nepal and Bhutan might open letters of credit with Bangladesh's commercial banks. It will help make Bangladesh a financial hub," Mr Imam hinted.

Mr Imam also said Bangladesh will earn $1.0 billion more a year as a result of the use of Indian power and gas by country's industrial sector.

Mr Imam, who joined the meeting as an expert, also said the transit will ensure Chittagong port utilisation fully.

"Currently, Chittagong port is being utilised up to 60 per cent and it's 100 per cent utilisation might take place after the transit," he added.

Mr Imam said vessels' freight charges will become lower as the transit will ensure ship's full capacity for both import and export cargoes.

Mr Azad, however, said Bangladesh's BSTI (Bangladesh Standards and Testing Institution) will be upgraded as the state-owned entity will implement four projects to be financed by $ 1.0 billion loan.

He also said: "We will procure six dredgers worth $72 million under the India financed 14 projects.

He said the terms and conditions of this loan are very easy and it will help build the country's infrastructure.

Mr Azad said the apex chamber body will visit India shortly to facilitate the country's export of cement, battery, frozen foods and food items.

"We will try to identify obstructions created by India in exporting Bangladeshi goods," Mr Azad added.

$1b earning a year likely from transit, transshipment treaties

 

[Skies]

A parliamentary watchdog has recommended naming the proposed Padma bridge after prime minister Sheikh Hasina's mother Begum Fazilatunnesa Mujib.

What the hell is her contribution for BD, if any?

5,000 to get jobs in Gopalganj

Fri, Jul 30th, 2010 12:12 am BdST
Gopalganj, July 29 (bdnews24.com)–The government will give jobs to 5,000 unemployed youth in Gopalganj under a national scheme created to ease the country's chronic unemployment situation.

Govt to draw roadmap for auto sector
Star Business Report

Instead of posting it will be done, it will be done, post it has been done, it has been done type news. It's very easy to say in meetings, parties, seminars, and opening ceremonies that we will do it, we will do it in future to get public support.

 

[CaPtAiN_pLaNeT]

RMG exports to Japan surge

Friday, 13 August 2010 23:50

RMG exports to Japan surge

RMG exports to Japan surge
Refayet Ullah Mirdha

Hasan Shibli, director of marketing at Base Textiles Ltd, was at his keyboard Wednesday in his meticulously neat office, primly typing in English to a new client despite the tiny beads of sweat forming at the edge of his grey-tinged but full head of hair.

His Gulshan Avenue office is air-conditioned, but yet another power outage has hit, and his generator can only support the PC, internet connection and some lights. His company exported garments worth Tk 175 crore ($27 million) in 2009, and he is determined to keep growth rapid despite the uncertain US economy. He is now negotiating with a Japanese buyer to supply two million T-shirts next year.

"It is just the beginning," says Shibli. "We started exporting to Japan two years ago. A lot of new customers are also coming to Bangladesh to purchase the Bangladeshi-made fine garments."

His interest in Japan is an example of Bangladeshi exporters looking to the Japanese market as the hottest new export destination. Apparel manufacturers and exporters are desperate for merchandisers who can speak Japanese, to get a foot in the door of an apparel market worth more than $35 billion a year.

Currently, Base Textiles is making one million T-shirts for the Japanese buyers. In 2009 it exported 2.5 lakh T-shirts to Japan. It started in 2008, with exports of 60,000 T-shirts.

Apparel exports from Bangladesh started to pick up after the Japanese government announced the China+1 strategy in 2008.

Japan is keen to reduce its dependence on China, the largest supplier of apparel items globally. The China+1 policy promotes shifting production from China to other nations, such as Bangladesh.

Being a member of the least developed countries' group, Bangladesh has duty-free access to Japan for woven product (under the generalised system of preferences, or GSP).

Knitwear faces a duty of 17 percent, as Japan clings to its aging knitwear industry.

Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said the Japanese government invited the BKMEA leaders to talk about duty-free access for knitwear. The BKMEA had asked Japan to relax rules-of-origin for knitwear items.

Hoque has travelled to Japan several times to woo both Japanese buyers and investors to Bangladesh. If Japan allowed duty-free knitwear, it would be a great opportunity for Bangladesh, he says.

He calls the invitation by the Japanese government "a positive indication." Hoque adds that Dhaka's decision last year inspired exporters with a cash incentive of 5 percent of each apparel shipped to Japan.

The former Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Anwar-Ul-Alam Chowdhury Parvez said Japanese customers are a long-term and stable opportunity.

"We should avail ourselves of the opportunity," Parvez says. "We should handle with them with care, as they rely on quality."

He says manufacturers need separate production lines for the Japanese customers, as they never compromise on quality. On the other hand, Japanese buyers can afford to pay for high quality, the former BGMEA boss says.

Garment exports to Japan maintained roughly a 175 percent growth rate between 2008-10 (though the last two months data are not yet in), according to the Export Promotion Bureau.

Even with the duty, Bangladesh registered a 231 percent rise in knitwear exports to $60 million in the first 10 months of the past fiscal year; and earned $90 million from woven garment exports -- 121 percent growth over the same period a year earlier.

The Japanese textile and clothing investors are also coming to Bangladesh. Three apparel factories -- Maruhisa, Yokohama Tape and TM Textiles -- started business in Bangladesh since 2009.

Three related companies (NI Teijin, CHORI and FVG) have opened liaison offices in Dhaka, and two companies opened quality-control inspection centres (PQC and K2) to meet Japanese national standards. (Japan Industrial Standards, or JIS, differ from ISO standards.)

Japan's Fast Retailing Company Ltd, which owns Japan's casual-clothing chain Uniqlo, signed a $100,000 agreement with Bangladesh's Grameen Bank Group on July 13 to produce garments at the group's factories. Uniqlo opened a liaison office in Dhaka in 2008.

Another major Japanese apparel manufacturer, Onward Holdings Co, launched social-contribution projects in Bangladesh.

In time, the Japanese customers of local RMG factories will come to terms with domestic issues, such as power shortages and other disruptions, as well as low labour costs, observers say.

"It will take time to understand each other, because Japanese customers know Chinese industries," said Takashi Suzuki, representative of JETRO, Dhaka. "They should know other countries, like Bangladesh and Vietnam."

Ultimately, he argues, Bangladesh must increase its productivity growth if it is to remain attractive to the land that brought the world the famous trademark Hello Kitty. Until then, the honeymoon between Japan and Bangladesh's RMG sector seems to be an increasingly happy one.

 

[CaPtAiN_pLaNeT]

Railway to link Cox's Bazar

7 priority projects in communications sector
M Abul Kalam Azad

The communications ministry has taken up seven priority projects to upgrade the internal railway links and signal system and connect Bangladesh with Trans-Asian Railway (TAR) network.

Under the projects of around $ 5 billion, the tourist city of Cox's Bazar will be connected with Dhaka via Chittagong while new tracks will be constructed between Dohazari and Cox's Bazar via Ramu at an estimated cost of $ 298 million. This rail track will reach Gundum near Myanmar border to connect TAR, a railway network across Europe and Asia. This is the only missing link with TAR inside the country.

Apart from that, the Mongla port will again be brought under railway network through construction of a 53-kilometre track at a cost of about $246 million.

Considering the TAR traffic scenario, the plan also aims at constructing two railway bridges over the river Jamuna--one parallel to Bangabandhu Multipurpose Bridge at a cost of $ 1,640 million and the other near Phulchari-Bahadurabad Ghat at $1,500 million.

Meanwhile, signalling system of 20 train stations between Ishwardi-Parbatipur section, five between Rajshahi-Abdullapur section and 15 between Darsana and Khulna will also be modernised.

The project proposals have been sent to the planning commission Wednesday for scrutiny and approval.

"Once the projects are finalised, we hope to implement those in three to four years," said a communications ministry official.

The priority projects were prepared as a follow-up action, as the Regional Cooperation and Integration (RCI) in road, rail and waterways got momentum after signing of the Joint Communiqu&#233; between Bangladesh and India this January, said the official.

"Based on the decision of the joint communiqu&#233;, Bangladesh Railway identified and prioritised some projects to connect the regional and Trans-Asian Railway corridors," a senior railway official told The Daily Start last week.

He said realising the importance of the regional connectivity the Asian Development Bank (ADB) has come forward to provide technical assistance to prepare the projects by allocating $12 million in the form of ADF (Asian Development Fund) loan.

The official said implementation of the projects would increase sub-regional trade among South Asian countries, especially to and from and through Bangladesh.

According to the communications ministry's plan, the capacity of Hardinge Bridge will be strengthened to accommodate the TAR traffic load. Rail tracks between Dhaka-Maowa-Jajira-Bhanga and Bhanga-Narail-Jessore will be constructed at a cost of $1,112 million to connect Dhaka with the south-western part of the country through planned Padma Multipurpose Bridge.

At present railway network in the northern part of the country is very roundabout. The government plans to construct the two railway bridges over the Jamuna to reduce distance between Dhaka and the region. Regional and TAR traffic will also move smoothly through the region to other parts of Bangladesh via Dhaka.

Construction of the rail tracks between Mongla port and Khulna will facilitate transport from Nepal and Bhutan since Bangladesh agreed to allow the two South Asian nations use the sea port.

According to transport experts the projects require immediate implementation, as Bangladesh has the potential to become a transport and trans-shipment centre for this region since it borders India and Myanmar and is close to the landlocked countries of Bhutan and Nepal, and Kunming, the key transportation hub in southern China.

These corridors have also been identified as potential investment in the Saarc Regional Multimodal Transport Study in 2006. Of the South Asian Association for Regional Cooperation (Saarc) priority corridors, Bangladesh has six out of 10 road corridors, two out of five rail corridors, and two principal ports--Chittagong and Mongla--for trade.

Although the economy of South Asia is growing fast, intra-regional trade is still around 5 percent of the total trade comparing to 26 percent in ASEAN (Association for South East Asian Nations), 52 percent in NAFTA (North Atlantic Free Trade Agreement) and 56 percent in European Union.

&#8220;Bangladesh plays a key role for RCI due to its geographical position and thus requires massive investment in development of its infrastructure and connectivity for national economic development and regional trade,&#8221; said Communications Minister Syed Abul Hossain.

He said the present government has emphasised improving the railway sector to make it a safe, less expensive and comfortable mode of transport for both national and international traffic.

Once implemented the projects will hugely contribute to the development of national, regional and international economy and trade, said the minister.

Railway to link Cox's Bazar

 

[eastwatch]

Govt. to Set Investment Rate at 32% of GDP by 2015
Doulot Akter Mala

The government is set to raise the rate of investment to 32 per cent of GDP by 2015, from 24 per cent, by ensuring infrastructure facility and sufficient power supply.

The sixth five-year plan (SFYP) for 2011-2015 has set the target in its first part draft. The General Economics Division (GED) of Planning Commission has recently prepared the draft of part-1.

The plan envisages a sizable increase in infrastructure investment under public-private partnership (PPP) initiative during the 2011-2015 period.

The plan targets about 2.0 per cent of GDP in PPP-related investment in the first year, and raising it to 6.0 per cent by 2015.

Focusing on PPP in power generation, the SFYP expects $9.5 billion investment to generate targeted 9,426 MW additional electricity by 2015.

The draft 'strategic directions and policy framework' of the SFYP also aims to attain 8.0 per cent real GDP growth and contain inflation within 6.0 per cent by 2015.

It has also targeted to increase private investment to 25 per cent of GDP from 19.1 per cent in the current year.

The draft of the first part will be reviewed in a meeting tomorrow (Wednesday), chaired by Planning Minister A K Khondaker. The panel of economists, headed by Wahiduddin Mahmud, will discuss pros and cons of the draft.

The draft SFYP is set to be finalised by September, and its printed version is likely to be available by this year, said noted economist Wahiduddin Mahmud.

"The draft will be revised and reviewed excessively. The panel of economists has given some initial comments on the draft," he said.

He, however, declined to comment on the draft SFYP, as it will be further reviewed in line with the recommendations of the experts.

"The higher growth rate in the SFYP is predicted upon a substantial increase in the investment rate from the current level of 24.5 per cent of GDP to 32 per cent by the end of the plan, averaging about 29.6 per cent of GDP investment per year during the plan period," the draft SFYP said.

The SFYP eyes improvement of infrastructure, trade liberalisation and technological progress to achieve the expected growth in investment.

In a bid to achieve 8.0 per cent GDP growth, the SFYP targets to increase agricultural growth to 4.4 per cent by 2015, from 3.5 per cent in 2010.

The SFYP also targets a boost in manufacturing sector that decelerated to 5.6 per cent in 2010 from 9.7 per cent in 2006.

"The performance of manufacturing sector has suffered setback in recent years due to domestic supply constraints and the global economic recession," the draft SFYP said.

The plan focuses on increasing the manufacturing growth from the first year of the SFYP to achieve its goal.

It has targeted to raise annual industrial growth to 9.5 per cent from 5.7 per cent in 2010, with the support of rapid expansions in manufacturing, power generation, transport, telecommunications and construction sector.

The SFYP has focused to double the annual growth rate of textile and clothing sector to 10 per cent from 5.1 per cent, construction services to 8.3 per cent from 6.2 per cent, leather products to 11 per cent from 7.7 per cent, and machinery to 9.3 per cent from 5.9 per cent.

"Revival of industrial growth is a precondition for high quality employment generation in the non-agricultural sector," it said.

The deceleration of industrial sector activities in recent years is primarily attributable to the slowdown in output expansion in the manufacturing sector, which accounts for about two thirds of industrial sector output," the draft plan added.