BSCIC industrial estates: Slow implementation a thorn for investors

Businesses are taking advantage of the increased connectivity offered by Padma Bridge but potential investors of four industrial parks under the Bangladesh Small and Cottage Industries Corporation (BSCIC) are missing out as the projects are yet to be complete. 

The opening of the country's largest bridge in June gave connectivity a shot in the arm since it has cut the time needed to move goods between the southwestern region of Bangladesh and the capital city.

Besides, the greater connectivity is expected to accelerate the activities of sea and land ports. But since three BSCIC industrial parks in Munshiganj and one in Nawabganj upazila of Dhaka are not ready, the targeted sectors are failing to reap the benefit.

BSCIC officials say both time and cost involved in developing the projects have escalated for numerous reasons, including complexities in land acquisition.

The total cost involved in these projects currently stands at about Tk 3,000 crore, up 187 per cent from the initial estimate of Tk 1,047 crore.

After receiving approval from the Executive Committee of the National Economic Council (Ecnec) in June 2016, the BSCIC began developing the country's first industrial park for light engineering and electrical goods in Tongibari upazila of Munshiganj the following year in an effort to bring local light engineering industries under a single hub.

The project was supposed to be ready by June 2019. However, the deadline was pushed back to June this year mainly due to difficulties in land acquisition, driving up the construction cost from the initial estimate of Tk 213.26 crore to Tk 309.59 crore.

Sitting on more than 50 acres of land, the industrial park, which is about 16 kilometres away from the Dhaka-Mawa Highway, has 362 plots, half of which will go to electric product manufacturers while light engineering industries will take up the rest.

Abdul Jalil, project director, said notification for the allotment of plots would be issued soon. About 80 firms have already applied for plots.

The government has revised down the price of each katha of land to Tk 13.50 lakh from Tk 19.95 lakh previously. Still, though, many potential investors say it will not be possible for them to set up factories unless they get plots at a more reasonable price.

"The price of each katha should be Tk 4 lakh," said Abdur Razzak, president of the Bangladesh Light Engineering Industry Owners Association.

Similarly, the move to relocate hazardous chemical warehouses and plastic factories from the congested neighbourhoods of Old Dhaka remains in limbo even though it has been 11 years since the initiative was taken.

The BSCIC had drafted a plan to relocate the chemical warehouses after at least 124 lives perished in the chemical-induced fire in Nimtoli of Chawkbazar in June 2010.

The Ecnec approved the initial plan to establish the BSCIC Chemical Industrial Park on 50 acres of land in Keraniganj at a cost of Tk 201.81 crore on October 30, 2010.

But in the face of protests from locals who were concerned about their safety following the Chawkbazar's Churihatta tragedy in 2019, the BSCIC changed the project site to Sirajdikhan upazila of Munshiganj.

In April 2020, the Ecnec approved the revised project worth Tk 1,615 crore with the number of plots increasing to 2,154 from 946 while the area of land to be acquired also rose to 310 acres.

Around 70 per cent of the development work of the industrial estate has been completed so far, according to Project Director Muhammad Hafizur Rahman.

The project was scheduled for completion by June this year but officials say they need at least one more year due to the delay caused by the relocation.

Rahman said the earth-filling suffered delays because of the disruption in the supply of soil over the last few months.

Nurul Mostofa Khoka, president of the Bangladesh Chemical and Perfumery Merchant Association, said they submitted papers to the authorities for 1,500 plots two years ago.

BSCIC PLASTIC INDUSTRIAL ESTATE

An initiative was taken to relocate the unplanned plastic factories from Old Dhaka to Sirajdikhan.

The project was supposed to be established on 50 acres of land on the western side of the Dhaleshwari river.

The total cost was initially fixed at Tk 210.48 crore but a new proposal to relocate the project has increased it to Tk 426 crore.

The Ecnec approved the project in July 2015 and work was scheduled to be complete by June 2020 but it has since approved an extension considering the new proposal.

At present, the implementation has been very slow as there have been delays in land acquisition.

"Efforts are being made to resolve issues related to land acquisition," said Project Director Nizam Uddin.

Shamim Ahmed, president of the Bangladesh Plastic Goods Manufacturers and Exporters Association, says they are interested in relocating their factories to the industrial park, given that land prices are reasonable.

BSCIC PRINTING INDUSTRIAL ESTATE

The plan to move unplanned printing factories in Dhaka and other places to a single hub was taken in 2016.

Sirajdikhan was initially selected as the project's site but the government officials who were assigned to acquire land in 2018 were assaulted by locals.

Now, the estate would be set up on 100 acres of land in Nawabganj upazila of Dhaka.

The development project proposal is in its final stage, said Project Director Nizam Uddin.

The costs have risen to around Tk 265 crore from Tk 138 crore.

API INDUSTRIAL PARK READY FINALLY

In 2008, the government took the initiative to build an industrial park for makers of active pharmaceutical ingredients and other medical raw materials in a bid to reduce import dependence.

The BSCIC API Industrial Park has been set up on 216 acres of land in Gajaria upazila of Munshiganj. Some 42 plots have been handed over to 27 pharmaceutical companies so far but only two factories are visible now.

"The government's responsibility to develop the infrastructure was completed in June last year and it is now up to the entrepreneurs to come forward for plots," said Project Director Syed Shahidul Islam.

The cost of the industrial estate was initially estimated at Tk 213 crore but due to the various complications, both the cost and duration had increased exponentially.

Khondaker Golam Moazzem, a research director of the Centre for Policy Dialogue, said there is a major weakness in project implementation in Bangladesh.

"Since light engineering, pharmaceuticals, chemicals and printing are emerging sectors, the BSCIC should quickly overcome weaknesses and complete the projects on time."

The parliamentary estimates committee also expressed displeasure at the slow pace of implementation of the projects and advised the BSCIC to prepare proper action plans considering their importance so that they can be finished on time.

Mahbubor Rahman, chairman of the BSCIC, said his organisation is also dissatisfied with the spike in time and cost of the projects.