13 years on, Carew's 2-year sugar expansion project extended again

Carew & Company (Bangladesh) Ltd, the country's only state-owned sugar and liquor producer, is set for yet another extension of its long-delayed sugar production enhancement project.

Launched in 2012 as a two-year plan, the project has faced repeated delays and, 13 years later, is yet to complete a trial production run.

Just before its anticipated launch, the project's steering committee has now recommended an extension until June 2026, primarily due to the end of the sugarcane crushing season, which prevents the completion of the crucial trial run. The industries ministry has already submitted a proposal for this latest extension to the Planning Commission.

Despite plans to complete the project by June 2025, unresolved mechanical issues and the conclusion of the sugarcane season have prevented the trial run from taking place, officials said. 

The steering committee, chaired by Industries Secretary Md Obaidur Rahman, decided on 24 March to recommend a one-year extension to ensure a full production trial during the next crushing season.

According to Project Director Fida Hasan, while almost all construction work is complete and sugarcane was prepared for the trial, "some machines in the machinery developed problems, preventing the trial run." 

Speaking to TBS, he explained, "The sugarcane season is over, and we will have to wait until next year for the trial run. This is why an extension has been recommended, which was decided at the steering committee meeting and sent to the Planning Commission."

The project, aimed at balancing, modernising, rehabilitating, and expanding Carew's facilities, was originally allocated Tk46.57 crore in government funding, with completion targeted by June 2014. However, successive extensions and revisions have raised the project's budget by over double to Tk102.21 crore, funded jointly by the government and the company itself.

Financial state of Carew

Established in 1938, Carew's ageing sugar production facilities have been increasingly unable to meet output expectations, leading to mounting losses year after year. Financial reports indicate that the cost of sugar production is now three times the revenue generated.

Nevertheless, Carew remains profitable overall, thanks to its monopoly in the liquor market. According to its audited financial report, in the fiscal year 2023–24, the sugar unit posted a loss of Tk61 crore, while the distillery unit made a profit of Tk144 crore. This resulted in a net profit of Tk84 crore, up from Tk64 crore the previous year.

Expansion project

A project was undertaken to replace Carew's 87-year-old sugar unit machinery and enhance its sugarcane crushing and production capacity. After two initial one-year extensions, the Executive Committee of the National Economic Council (Ecnec) approved a major revision in 2018, increasing the budget and extending the project's duration to 2020.

Despite further extensions, the project remains incomplete. By February 2025, the project had achieved 77.24% financial progress and 98% physical progress.

The steering committee thus concluded that completing a full trial run over an entire crushing season is critical to the project's success, necessitating the extension to June 2026.