Deal this year for Indian special economic zone
The Bangladesh Economic Zones Authority (Beza) plans to sign a commercial agreement with India by this year for establishing the Indian Special Economic Zone (ISEZ) as negotiations in this regard are almost complete.
Shaikh Yusuf Harun, executive chairman of Beza, said they will sit with Indian delegates to finalise the negotiations within one month and then fix a date for the deal signing.
Harun hopes that billions of dollars will pour in as investment from the neighbouring nation once the ISEZ inside the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) in Mirsarai, Chattogram is complete.
As part of the negotiations, a final draft of the agreement will be prepared and presented to the Indian side for approval, according to the executive chairman.
Sources say India has already approved $115 million for the project under its third line of credit amounting to $4.5 billion.
The economic zone will go into full operation by 2023, creating about 3 lakh opportunities for direct employment.
However, Harun said the number of companies that will set up shop at the ISEZ is yet to be finalised.
Harun went on to say that they are ready to hand over land to Indian developer Adani Ports and SEZ Ltd to begin construction works on the ISEZ, which will be set up exclusively for Indian investors on 1,000 acres of land.
So far, Beza has received a total of $62.72 million in investment proposals for the BSMSN from three Indian investors.
The negotiations will be finalised after it is decided whether Beza will go for a profit-sharing model with investors of the ISEZ or charge them rent for land use.
Harun then said that Beza prefers the profit-sharing model.
Meanwhile, a consultancy has been appointed to design the proposed economic zone and supervise its construction, he added.
Beza and Adani Ports had signed a term sheet agreement for the development of a special economic zone for Indian companies at the BSMSN in April this year.
With an estimated cost of Tk 964.85 crore, including the Indian line of credit worth $115 million, the purpose of this project is to establish a separate zone to attract Indian investors.
The main work of this project is to complete land development, establish connecting roads, administrative buildings, security systems, water supply systems, telecom, water treatment plants and other investment friendly facilities.
A memorandum of understanding was signed between Bangladesh and India in June 2015 for establishing the ISEZ under Beza. For this purpose, two economic zones were identified in Mongla upazila of Bagerhat, and Mirsarai in Chattogram.
The development activities will be implemented under the Concessional Line of Credit of the government of India.
Beza has already taken ownership of 110 acres of land in Mongla, for which India's Hiranandani Group was appointed as developer while Adani Ports will work as a developer for Mirsarai.
In February 2019, the Executive Committee of the National Economic Council (ECNEC) approved a project involving Tk 845 crore to acquire 1,000 acres of land in Chattogram's Mirsarai for Indian investors.
The implementation of the ISEZ would bring down the trade gap between Bangladesh and India, which is currently heavily tilted towards the latter, Harun said.