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India is lending 11.5 crore USD to establish an economic zone for Indian investors in Bangabandhu Industrial City. This means about Tk. 978 crore in Bangladeshi currency.
Bangladesh is getting this loan under India's Third Line of Credit (LOC). The third LOC was signed in October 2017 when the then Finance Minister of India Arun Jaitley visited Bangladesh. Under this, the total loan pledge was 450 crore USD.
Pawan Chowdhury, executive chairman of the Bangladesh Economic Zones Authority (BEZA), said the Indian government had agreed in principle to provide loans for projects to establish the Indian Special Economic Zone (ISEZ). In Bangladesh, the project has already been approved by the Executive Committee of the National Economic Council (ECNEC).
During the visit of the then Prime Minister of India Narendra Modi to Bangladesh in 2015, a memorandum of understanding was signed to establish an economic zone for Indian investors.
Initially, India was interested in establishing an economic zone on 460 acres at Bheramara in Kushtia and 110 acres at Mongla in Bagerhat. In January 2017, the Indian Ministry of External Affairs expressed interest in establishing an economic zone at Mirsarai in Chittagong. Now India is not showing much interest in the other two projects. The work is around Mirsarai.
Work is underway to establish Bangabandhu Industrial City on 30,000 acres of land including Mirsarai, Feni and Sitakunda. About one thousand acres of land has been set aside for India in Mirsarai.
The Adani Group has been tasked with developing the economic zone for India. Adani Ports and SEZs, a subsidiary of Adani, are doing the work. Adani signed a memorandum of understanding with BEZA on October 4, 2019. On January 1, the Prime Minister's Office approved Adani as a developer.
Bangladesh is establishing economic zones not only for India but also for Japan and China. The Japanese economic zone is being established in Narayanganj at Arai hazar. In two steps, the total land will be about one thousand acres. And China is establishing an economic zone on 783 acres of land in Anwara, Chittagong.
The main goal of establishing this economic zone for the three countries is to bring investment from those countries. And all three countries are lending to Bangladesh to establish economic zones for their respective investors. Again, a part of the ownership of the economic zones is in BEZA's hands. For example, in the Japanese economic zone, BEZA's share is 24 percent. And the share in the Chinese economic zone is 30 percent. In the case of the Indians, it is not yet final.
Khandaker Golam Moazzem, research director at the Center for Policy Dialogue (CPD), a non-governmental organization, said China, Russia and India were lending to various countries under South-South cooperation. They are new as lenders. The terms, structure, etc. of such loans with them have not been decided yet. As a result, it takes time to complete the process of debt relief.
Golam Moazzem thinks Corona has created a possibility for investment transfer in the near future. That may be a matter of time. However, Bangladesh needs to be prepared to seize that opportunity. For this, the work of economic zones needs to be taken forward quickly.
Source: Online/SZK
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