Chinese, Japanese economic zones soon to be a reality

Asif Showkat Kallol: Japanese and Chinese authorities will finalise setting up several economic zones in four months as part of a bid to bolster foreign direct investment in Bangladesh.

Besides, India authorities are now conducting surveys to build a number of dedicated economic zones of their own in Bangladesh.

Paban Chowdhury, executive chairman of Bangladesh Economic Zones Authority (BEZA), told the Dhaka Tribune yesterday: “If there was no unrest here over the last four months, the Indian authorities would have already finished the studies to choose investment zones in Bangladesh.”

The Japanese are expected to finalise their decision by June 30 on chosing two locations for building their own economic zones in Bangladesh. Similar decisions are expected from the Chinese by the end of August, Paban said.

“But the investment decisions from these two Asian countries will depend on political stability here,” he added.

BEZA has already acquired 206 and 279 hectares of land in Gazipur and Narsingdhi respectively for the Japanese; and 341 and 3,122 hectares in Anwara and Mirsarai in Chittagong respectively for the Chinese investors. The proposed name for the Chinese investors is “Chinese Economic and Industrial Zones.”

This came up in a recently meeting of the BEZA with PM Sheikh Hasina in the chair.

The Chinese authorities will bring gas from Myanmar for powering up the industries set up in economic zones in Chittagong.

Paban Chowdhury said: “We will develop infrastructure outside the economic zones. But the investors from the relevant countries will have to carry out the developments needed on the inside.”

The Indian authorities have shown intersts about setting up industrial zones in Jamalpur, Panchagarh and Sirajganj.

In 2010, the government decided to offer 22 economic zones to both local and foreign investors. BEZA is now highlighting 17 of these locations saying they are more or less ready to take in investments.

BEZA has so far issued operational licenses to local private investors AK Khan Group and Abdul Monem Ltd. Meghna Group, a local conglomerate, is trying to acquire license for two zones.

Bangladesh Garments Manufacturers and Exporters Association (BGMEA) will develop yet another private special economic zone in Munshiganj.

The interested local and foreign developers will sign 50-year contracts for getting hold of each of these economic zones.

According to a draft policy, a license will cost a local investor Tk5,000 crore and a non-refundable $20,000 dollars.

The Prime Minister’s Office has prepared a draft incorporating 20 types of incentives relating mostly to customs, VAT and income tax. Foreign investors will be able to repatriate 100% of their profits which existing rules do not allow.

Economist AB Miza Azizul Islam told the Dhaka Tribune that Bangladesh needs $35bn investment every year to attain a 8% year-on-year economic growth and graduate to a middle-income country by 2021.

“That is why the government has taken the initiative to build the economic zones to attract more foreign investment. But without political stability in the country, none of these will work.

“We cannot but wonder why the Koreans, the first foreign investors to set up their export processing zone in Bangladesh, have been treated so shoddily.

“One part of the more than 1,000 hectares of land allotted to the KEPZ will be reacquired by the government for what appears to be violations by Korean firms. This hardly garners confidence among prospective foreign investors,” said Mirza Azizul Islam, who was a finance adviser to a former caretaker government.

dhakatribune

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