'Military Economic Zone' to be set up at Mirsarai SEZ, replacing Indian G2G project: Bida chief

Highlights

• Govt okays 'Military Economic Zone' in Mirsarai's NSEZ
• 850 acres freed after Indian Economic Zone dropped from G2G plan
• Decision taken at Beza board meeting chaired by CA Yunus
• Zone to focus on defence and military industrial production
• Bangladesh eyes domestic arms manufacturing amid global demand
• Anowara to host country's first free trade zone
• 1.25% cashback on FDI brought by expatriates

The government has taken a policy decision to establish a 'Military Economic Zone' at the National Special Economic Zone (NSEZ) in Chattogram's Mirsarai, said Chowdhury Ashik Mahmud Bin Harun, executive chairman of the Bangladesh Investment Development Authority (Bida) and the Bangladesh Economic Zones Authority (Beza).

Speaking at a press briefing at the Foreign Service Academy in Dhaka this afternoon (26 January), he said the decision was taken at the 4th meeting of the Beza Governing Board held today, chaired by Chief Adviser Muhammad Yunus, who is also the chairman of the board.

"The Indian Economic Zone has been excluded from the government-to-government [G2G] framework, leaving the land vacant. The proposed Military Economic Zone will be developed on around 850 acres of land at the site," Ashik said.

Govt scraps Indian Economic Zones as project stalls

The Bida chief also said, "We have been discussing defence industrial production – military weapons or production for the military industry – for a long time. At this moment, there is clear global demand for it. Even from a purely economic point of view, defence is an industry where Bangladesh can begin participating and start its work."

He said that at the same time, they have observed that given the current global situation, having domestic arms manufacturing or certain captive capacities has become very important.

"Because when there is a supply shortage, if you do not have ammunition on the battlefield, you have no opportunity to fight. In many recent wars, it has been seen that the shortage is not in high-technology items. The shortage is in bullets. The shortage is in tank axles. We are considering whether we can play a role in those areas."

National Special Economic Zone to take 20 more years to be fully ready

He added that the Armed Forces Division, Beza, the Chief Adviser's Office, and the Ministry of Defence have been working on this issue together for quite some time.

"Today, we placed this proposal before Beza's governing board, identifying around 850 acres of land in Mirsarai. A policy decision has been taken to include this in the master plan, which will now be designated as a defence industrial zone."

The Bida executive chairman further said that the site is currently vacant. "It had previously been identified as an Indian economic zone, but that project has been cancelled. As the land was available, we will now use it as a military industrial zone, and it will be incorporated into Beza's master plan."

Anowara to host country's first free trade zone

One of the most significant decisions taken at the Beza Governing Board meeting was the policy approval to introduce a Free Trade Zone (FTZ) in Bangladesh. At present, Bangladesh has no formal framework for a free trade zone. An FTZ refers to a designated area where goods can be stored, manufactured, and re-exported without customs duties, effectively functioning like a deemed overseas territory.

Speaking at a press conference, Ashik said that establishing a free trade zone would further strengthen Bangladesh's position in the global supply chain. As an initial step, a plan has been taken to set up an FTZ on around 600 to 650 acres of land in Anowara, Chattogram. Following the policy approval, the proposal will be placed before the cabinet for final approval.

Explaining the importance of such a trade zone, he said that due to long lead times, cotton imported from the United States is currently used on a limited scale in Bangladesh's garment sector. However, if cotton could be stored in a free trade zone within the country, it would be possible to quickly re-export it to Bangladesh or other countries as needed.

Initiative to revive Kushtia Sugar Mill

The Bida executive chairman also said a policy decision was taken at the meeting to revive the Kushtia Sugar Mill.

He noted that many sugar mills in the country have been incurring losses for a long time, prompting discussions on their effective utilisation. Since the Kushtia Sugar Mill area already has gas, electricity, and road infrastructure, the government sees potential to bring it under an economic zone and launch new industrial activities there.

According to policymakers, if implemented, the initiative will create employment opportunities in the southwestern region and ensure productive use of more than 200 acres of land.

Opportunity to establish economic zones within municipality areas

Another significant decision was to allow the establishment of economic zones within municipality areas.

The Bida chief said that under the 2012 law, municipality areas were excluded from economic zones. However, with the number of municipalities increasing to 331, setting up economic zones outside urban areas is putting growing pressure on agricultural land.

As a result, a policy decision has been taken to allow the formation of economic zones within municipality areas to bring closed or abandoned industrial facilities back into economic activity, he added.

1.25% cashback on FDI brought by expatriates

The Bida Governing Board has also given policy approval to provide a 1.25% cashback on foreign direct investment (FDI) brought in through expatriate Bangladeshis.

At the press conference, Ashik said the initiative aims to attract foreign investment by leveraging the international networks of expatriate Bangladeshis. 

To support this effort, he added that a decision has also been taken to open Bida sub-offices abroad, including in China, South Korea, and Japan.