Govt plans to convert some closed jute, sugar, and textile mills into economic zones

Infographic: TBS

The government plans to convert some of the country's defunct jute, sugar, and textile mills into economic zones to better utilise idle land and infrastructure and attract investment for industrial growth.

The Bangladesh Economic Zones Authority (Beza) governing board met on 13 October, with Board President and Chief Adviser Muhammad Yunus presiding, to discuss strategies for repurposing closed state-owned industrial enterprises as economic zones.

According to meeting sources, Beza plans to initially convert three such entities — Karim Jute Mills Ltd in Dhaka, Kushtia Sugar Mills Ltd, and Mohini Textile Mills Ltd in Kushtia.

This initiative is part of a wider effort to identify and transform other non-operational state-run factories into economic zones, sources said.

Earlier, Beza Executive Chairman Chowdhury Ashik Mahmud Bin Harun had shared this plan with journalists.

While outlining Beza's future plans in January, he said, "Over the next two years, we will work on developing five economic zones on a priority basis. In addition, we have plans to turn shuttered jute and sugar mills into economic zones, as the government already owns a significant amount of land in those areas — some even have existing buildings.

"Much of the land remains unused, yet it has access to electricity and water. We want to take advantage of these opportunities," he said, adding that as utility services are available in some closed mills, it will be easier to attract investors.

All jute mills under the Bangladesh Jute Mills Corporation (BJMC) are currently shut down. Citing financial losses and labour unrest, the government halted production at 25 BJMC-run mills at a time in July 2020.

In December 2020, the Bangladesh Sugar and Food Industries Corporation (BSFIC) announced the closure of six state-owned sugar mills. ​These mills were shut down due to significant financial losses and plans for modernisation to improve their viability.

Specific data on the number of closed state-owned textile mills is not readily available. However, reports indicate that around 23 mills under the Bangladesh Textile Mills Corporation (BTMC) have been non-operational, with some being leased to private entities or repurposed for other uses.

At an event in January, Commerce Adviser Sk Bashir Uddin said that the interim government plans to lease out some of the closed jute and textile mills to private entrepreneurs. 

"Although around 50 of such mills remain non-operational, three have already been handed over to private investors, with several more in the process of being transferred," he said.

According to people concerned, these long-shuttered state-owned enterprises are now facing structural decay due to the lack of modern technology, reduced market demand, and various management issues. 

The land and infrastructure of these mills, located in historically industrial zones, are not being used for new industrial or economic activities, despite being highly suitable for such purposes and in demand among investors.

Current status of 3 shuttered mills targeted for EZs

Beza has conducted a preliminary assessment of three shuttered state-owned mills and found them suitable for conversion into economic zones.

Karim Jute Mills Ltd: Under the Bangladesh Jute Mills Corporation, Karim Jute Mills is located on 49.62 acres along the Shitalakkhya River in Demra, Dhaka.

The site features a jute mill, warehouse, administrative and residential buildings, a training centre, logistics facilities, three large ponds, and vacant land.

Infrastructure includes internal roads, drainage systems, boundary walls, and a jetty for river transport. Utilities comprise an 11 kV substation, gas supply system, and deep tube wells.

Its proximity to the Sultana Kamal Bridge facilitates easy transport to major regions such as Dhaka, Chattogram, and Sylhet.

The area also includes off-site and social infrastructure such as banks, financial institutions, and a reliable supply of industrial labour.

Kushtia Sugar Mills Ltd: Operated by the Bangladesh Sugar and Food Industries Corporation, this mill was established in 1961 on 221.46 acres in Jagati, Kushtia.

The complex includes a sugar factory, commercial farm, bio-fertiliser plant, and administrative and residential facilities, along with two large warehouses for storage.

It has a 33/11 kV power substation, distribution lines, deep tube wells for water supply, and an internal road network.

Located near the Kushtia Bypass on the Jashore–Rajshahi highway, the site enjoys strong transport connectivity. The mill was shut down in 2020.

Mohini Textile Mills Ltd: Managed by the Bangladesh Textile Mills Corporation, Mohini Textile Mills is situated in the Mill Para area of Kushtia town on 99 bighas of land.

Of this, 28 bighas are occupied by the main factory building, while the rest have been used for social infrastructure.

The premises are supported by their own electricity and water supply systems