Officials said yesterday shipment of 2,764 tonnes of toxic fertiliser, stocked at two government silos since 1991, now hangs in the balance due to a tangle over payment of income tax by two Dutch technicians to be paid from the grant money during their stay in Bangladesh for safe handling of the toxic fertiliser.

The National Board of Revenue (NBR) has not approved income tax exemption to the Dutch technicians scheduled to stay in Bangladesh for a maximum of 45 days.

The Dutch government through its embassy in Dhaka has asked the Economic Relations Division (ERD) to expedite the process of signing the grant agreement.

Bangladesh Agriculture Development Corporation (BADC) imported 6,300 tonnes of zinc oxy-sulfate from Stollar Chemical Company of the United States under an Asian Development Bank (ADB) credit in 1991. Of the consignment, 3,536 tonnes were marketed but the government later found the fertiliser was toxic with abnormally high concentration of lead-cadium.

The rest 2,764 tonnes remain stocked at two BADC godowns in Chittagong and Khulna since then.

A public sector Dutch company -- AVR Industrial Waste BV -- through its local agent Kamico Bangladesh Ltd. signed a contract with the BADC on January 7 last year to transport the toxic fertiliser to Rotterdam Port in the Netherlands for safe destruction.

Since November 17 last year, the company brought in two containers full of toxic matter handling equipment and the United Nations-approved special hazard-free packaging bags and gloves to do the job. It also procured permission from all ports on the way to Rotterdam from Chittagong and Mongla ports for passing through them carrying toxic materials.

But due to the tax tangle, both the BADC and AVR Industrial Waste BV fear that Bangladesh may have to retain the toxic stuff as it may miss the shipment deadline -- April 30 this year.

"If the grant agreement is not signed by March 15, we'll miss the 45-day shipment period that ends on April 30," a senior official said on condition of anonymity.

BADC Chairman Mohammad Ismail wrote to the NBR authorities on March 1 if the NBR did not inform the ERD immediately that the income tax was waived, thus to get rid of the toxic fertiliser.

Earlier, the agriculture ministry had also asked the NBR authorities to inform the ERD by February 25 about the tax exemption so that the ERD could take immediate steps for signing the grant agreement.

But NBR Chairman Khairuzzaman Chowdhury told The Daily Star last night, " Bangladesh and the Netherlands have double-taxation agreement between them and that every tax issue between the two countries should fall under that agreement." There are no separate tax exemption provisions, he added.

Another NBR source said the BADC and AVR Industrial Waste BV should have consulted the NBR before they had signed the contract back in January last year.

Talking to The Daily Star yesterday, State Minister for Agriculture Mirza Fakhrul Islam Alamgir said as far as he knew Bangladesh would soon get rid of the toxic fertiliser. He however could not say anything about any tangle over the matter.

Meanwhile, the United States daily The Seattle Times reported in 1997 that Stoller Chemical of Charleston, South Carolina, exported 3,000 tonnes of especially toxic material to Bangladesh and Australia in 1992.

The company failed to notify the US authorities concerned about the toxic shipment, as required by law, and was fined $1 million. Stoller went bankrupt.

Later, Bangladesh government also received part of the $1 million in compensation.

More than half of the toxic fertiliser was sold to farmers in Chittagong, Rangpur, Gaibandha, Kurigram, Dinajpur, Panchagarh, Khulna, Barguna, Patuakhali, Shombhuganj of Mymensingh, Melandaho of Jamalpur and Shibganj of Bogra.

"Rice, potato, sugarcane and turmeric growers mainly bought the fertiliser but it is not possible to find them out now and pay compensation," an official said.