'Beza will add $40b to the economy by 2030'

The government aims to establish 100 economic zones across the country by 2030 to achieve industrial self-sufficiency, decentralisation and 1 crore employment target. The Bangladesh Economic Zones Authority (Beza), established in 2010, is working towards that goal. Several economic zones have already been developed in which local and foreign companies have invested. Beza Executive Chairman Shaikh Yusuf Harun tells The Business Standard's Abbas Uddin Noyon and Jahir Rayhan about the latest developments and investment status of the economic zones.

How many economic zones has Beza developed so far? Will it be possible to establish 100 zones by 2030?

So far 97 zones have been approved and 10 of them have been completed while another 29 are currently under implementation. Production in the completed zones has started.

There are six types of economic zones, including public, private, public-private partnership (PPP), and government-to-government (g2g). These zones, except the government ones, are being developed according to demand.

Land allocation to investors in the government-implemented Jamalpur Economic Zone and Srihatta Economic Zone has been completed and factories are being set up now. 

Production started after completing the development work of 10 private economic zones including City and Meghna. 

Bangabandhu Sheikh Mujib Shilpa Nagar, the largest economic zone in South Asia, is being developed in phases. Some companies have also started production there. Beza has 17,000 acres of land out of the total 33,500 acres of Sheikh Mujib Shilpa Nagar.

The Japanese Economic Zone in Araihazar upazila of Narayanganj is the foremost among the g2g zones. The first phase of land allocation is completed and the second phase is underway. 

Two g2g zones with India are awaiting the start of work. We had our first negotiation meeting with the developer company for the Chinese Economic Zone. The Developing Eight (D8) Secretariat has proposed another one for member countries.

Apart from this, Saudi Arabia wants to make a country-specific zone on 300 acres of land. Singapore has also sought land from us. Therefore, 100 economic zones will be established by 2030 for thousands of domestic and foreign investors.

These economic zones will generate and export an additional $40 billion worth of goods annually along with the employment of 1 crore people.

Entrepreneurs allege that the price of Beza land is high and beyond the affordability of small industries. Is that true?

Land outside the economic zones cost four to five times higher than the ones we offer. We have filled up low-lying lands, constructed roads, and provided all sorts of utilities. Considering these cost-benefits, the price is considerably low.

Besides, any investor can approach us for both developed and undeveloped land. The price will be much lower for undeveloped land – and we have 62,000 acres of undeveloped land.

Entrepreneurs also complain about the new 15% VAT imposed after the land lease agreement.

The VAT law came into effect after lease agreements had been made with investors in many economic zones. Investors are expressing unwillingness to pay the additional 15% VAT on leased land value. We have also negotiated the matter with the stakeholders concerned.

We told the National Board of Revenue (NBR) that Beza develops land for industries. The Rajdhani Unnayan Kartripakkha (Rajuk) develops land for housing and pays VAT at 2%. So, why would we pay 15% VAT? I have also informed the Prime Minister's Office about it. The NBR agreed in principle. We are waiting for a positive response.

One of Beza's initiatives was One Stop Service, which began in 2015, but traders still complain they are not getting most of the services. Why is that?

Till now 125 types of services are being provided by Beza One Stop Service Centre. Out of these, 50 services are being provided online and the remaining 75 services are not solely in our hands. The representatives of various departments of the government are supposed to provide these services. We are trying to enhance our services and reduce hassles for businesses.

Businessmen will soon be able to obtain trade licences, land registration, environmental clearance, construction approval, electricity, gas and water connection, telephone and internet connection, and boiler certificate online.

What else does Beza offer to investors?

Beza is essentially a coordinating body. We link investors with the government or various government agencies. We listen to investors' problems and do what we can to solve them. 

For example, last year the American company Huntsman Corporation transferred its warehouse from Singapore to Bangladesh. But it could not do so initially due to a lack of a bond licence. We then met the NBR chairman along with the then principal secretary to the Prime Minister's Office. And the NBR chairman solved this problem immediately.

Entrepreneurs blame Bangladesh's low score in the Ease of Doing Business Index for not having enough foreign investment. The World Bank discontinued the index in 2021. Have you continued it to develop yourself?

We are working on every index of ease of doing business. We want to ensure that all services including land acquisition, registration, environmental clearance, construction approval, and electricity, gas and water connections are easily available. 

Automation is being done to facilitate the clearance of goods at customs and ports. We are making arrangements so that foreign investors can repatriate their dividends easily. Our mission is to facilitate the business environment.

Foreign Direct Investment (FDI) in Bangladesh is less than 1% of its economy. Why is it so low?

Many foreign companies are making joint investments with Bangladeshi companies. These investments are not counted as FDI. If counted, then FDI will be higher. 

I am optimistic about the initiatives we have taken over the past decade. The Japanese companies in the Bangladesh Special Economic Zone will invest beyond our target. FDI will increase if the first phase of this zone is launched.

Why should foreign investors come to Bangladesh, leaving India, Vietnam, and Indonesia? What facilities are you offering?

The first reason for foreign companies to come to Bangladesh is political stability. In this regard, we are in a better position than any country in the subcontinent. A Taiwanese industrialist has 19 factories in Myanmar and he wants to shift to Bangladesh because of the political problems there.

The second thing is that skilled labour is easily available in our country as compared to other countries. The support we provide is better than many countries. We provide attractive incentives.

Anything you want to say to investors?

We are providing land, utility support and connectivity at their doorsteps. Best of all, those who invest in our zones will receive lucrative incentives and other benefits including tax benefits for up to 10 years.

I am urging those investors who have not set up industrial plants two years after acquiring lands. Many could not do it due to the pandemic but now they have to as per the law. Otherwise, legal action will be taken against those companies.

Beza Executive Chairman Shaikh Yusuf Harun. Illustration: TBS