The government is creating investment-friendly economic zones linking Bangladesh with the free market economy and liberalise trade. It wants private entrepreneurs to get opportunities and to establish and profitably run industrial enterprises. A Bangladesh Economic Zones Authority (BEZA) report shows that the contribution of the industrial sector to the country’s economy is on the rise. During 1971–80, the contribution of the sector to GDP was 11 per cent. It has increased to 30 per cent in FY 2015–16. Manufacturing sectors like textile and apparel, leather, food and beverage, and pharmaceuticals have contributed to building a vibrant industrial economy. A robust growth of the manufacturing sector is the only way for an overpopulated country like Bangladesh to graduate to the next level, said Towfiqul Islam Khan, a research fellow at the Centre for Policy Dialogue (CPD). The BEZA has been established under the Bangladesh Economic Zones Act 2010. The purpose of BEZA, under the Prime Minister’s Office (PMO), is to establish economic zones in potential areas of the country for rapid economic growth, said its executive chairman of BEZA Paban Chowdhury. While the government has set a target of setting up 100 economic zones, pre-licence has already been given to 13 private firms and seven more will be added soon, he told The Independent. The planned economic zones:The government has chosen three categories of economic zones. Private economic zones will be set up through a public-private partnership by foreign or local individuals, individually or jointly by local or non-resident Bangladeshis or foreign investors, a body, business organisation or group. Government economic zones will be established and owned by the government. Special economic zones will be established by a public-private partnership or by government initiatives for the establishment of any kind of specialised industry or commercial organisation. Bangladesh has been consistently maintaining a Gross Domestic Product (GDP) growth of 6 per cent for over a decade. The country has faced many problems for 10 to 12 years. But every time, it has made a comeback. Bangladesh has a lot of low-cost, well-educated, highly adaptive and industrious workforce, which has been proven by its remarkable success in the readymade garments (RMG) manufacturing and export sector. Compared with its neighbours, Bangladesh’s energy prices are much cheaper. Incentives for economic zones: The location of the economic zones has to be strategically feasible, which includes regional connectivity, an affordable labour force and backward linkage opportunities. The incentives must be competitive. According to the BEZA report, the government intends to provide the same fiscal and financial incentives to industrial units as those provided to the industrial units under the Bangladesh Export Processing Zones Authority Act, 1980, and the Bangladesh Private Export Processing Zone Act, 1996. BEZA wants private sector entrepreneurs to take the land from them and do business. BEZA’s 99 per cent concentration is on helping the private sector, said the executive chairman of BEZA. The government has already planned to give certain facilities to Foreign Direct Investment (FDI), including uninterrupted gas and electricity supply. According to BEZA’s vision document, other than infrastructure, BEZA will provide multiple incentives to the developer of an economic zone and investors in a particular industrial unit. These will include fiscal benefits, such as tax exemption, customs/excise duties, and non-fiscal incentives, such as no FDI ceiling, work permits and citizenship. The BEZA vision document also expresses incentive package information for both developers and unit investors. For developers, income tax will be exempted for 12 years. For unit investors, income tax will be exempted for 10 years. Developers will enjoy an exemption from stamp duty and registration fees for land registration. Unit investors will enjoy 100 per cent backward linkage of raw materials and get to sell accessories for submitting Expressions of Interest (EOI) in Domestic Tariff Area (DTA). One-stop services: The primary objective of BEZA is to act as a change agent for faster economic growth by creating an investment-friendly environment in the country. Reducing lead time and cost of doing business is the pivotal objective of BEZA. While talking to The Independent about one-stop services, a senior official of BEZA said incentive packages would be provided to both parties—developers of the economic zones and the manufacturing unit investors. The senior official added that 30,000 hectares will be developed and employment is expected to be generated for 10 million people. Export goods worth USD 40 billion are expected to be produced per year. The BEZA vision document also mentions the requirements and procedures of the application for private economic zones. It mentions that an enterprise shall submit the first-stage application for a pre-qualification letter and submit an application for a licence under Article 6 within 12 months from the date of issuance of the pre-qualification letter. Recently, Meghna Group of Industries and Abdul Monem Group have received the licences to set up private economic zones. Abdul Monem Group has gone through the entire process of building a private economic zone and has successfully implemented and passed all the requirements, said Paban Chowdhury at a licence-awarding ceremony recently. The Abdul Monem Economic Zone (AMEZ): AMEZ, a subsidiary of Abdul Monem Ltd, has received the final licence from BEZA to develop a 216-acre private economic zone at Gazaria in Munshiganj. It may be expanded to over 300 acres in future. BEZA sources said a few things are important to establish an economic zone. Some of these are regional connectivity, offsite-onsite connectivity, enough gas and electricity, transport and export facilities and labour accessibility. Describing the challenges of building an economic zone, the deputy managing director of Abdul Monem Ltd, Mainuddin Monem, said, “Bangladesh has a scarcity of land. So, to get adaptable and sustainable land for the economic zone was the biggest challenge for us.” Many types of industries will find a place in AMEZ. These are pharmaceuticals, RMG, and small and medium enterprises (SMEs) run by women. The area of this economic zone is 142.4190 acres. Around 1 lakh jobs will be generated from this zone, said Monem. AMEZ will have access to the airport (61 km from Hazrat Shahjalal International Airport), seaport, road and the river. Sabrang Tourism Park: The 1027-acre Sabrang Tourism Park will be the first exclusive tourism park in Cox’s Bazaar district. It will be developed on 300 acres in two years. By 2018, the land will be ready to develop, said Chowdhury. Some foreign direct investors have already shown interest in the Sabrang Tourism Park, which will have an exclusive beachfront, Chowdhury said. A labour welfare fund will be soon formed for the labourers who will work in the economic zone, said an official source in BEZA. However, on the condition of anonymity, a high official of BEZA said it takes about eight to 10 years for an economic zone to be planned and set up and at least four years to develop infrastructure. So, all these plans will take time to be implemented.
