Dhaka-Ctg expressway: So needed, yet so overlooked

FE: Please describe the situation of the business sector in the country now?

Alihussain Akberali: Due to the political unrest, the situation in Bangladesh is highly precarious these days. We have reduced our production levels due to low demand and difficulty with opening Letters of Credit due to a dollar shortage in the country. Uncertainty is not desirable in our country at this stage when the people are investing tens of millions in steel, cement and other industries.

FE: To what extent the Russia-Ukraine war is hampering our trade and business as well as the economy?

Alihussain Akberali: The main reasons for high inflation in our country are not the local issues, but mainly the skyrocketing prices of food grains, oil, gas, fertilizer, etc. imported from abroad. Dollar has strengthened due to excess demand for the greenback. The local currency BDT lost value remarkably in the past one year. This also has led to inflation and significant increases in costs for all companies importing raw materials from abroad. Our domestic economy might have been quite OK, had we had our foundation strong with a robust export base and a much bigger and accurate foreign exchange reserve.

FE: After the Covid-19 outbreak, how are trade and business recovering the losses right now?

Alihussain Akberali: The BSRM was lucky to have managed to recover the losses, mainly because of the pragmatic policies of the government taken during the time of the pandemic, allowing additional loans at concessional rates of interest and making sure factories could operate and keep basic economic activities on. That helped maintain cash flows and continue operations without reducing manpower. The country was run very adeptly during the Covid-19 period and thankfully the economy did not remain shut for long like many other countries abroad.

FE: Is increase of the rate of dollar hampering the business here in Bangladesh? If it is 'yes', how can we control it?

Alihussain Akberali: We cannot control devaluation of our currency, unless the government comes up with a pragmatic policy to support export of non-traditional items. Presently most of the policies are aimed at supporting export of readymade garments, leather, vegetables, sea food, etc. but no one is giving attention to the import substitute industry and encouraging them with higher financial subsidy on export of their items, for which the market is there. We are unable to export to the existing market abroad mainly because of the lack of port efficiency, huge transport cost and the absence of an elevated expressway that can bear higher tonnage, allow a faster speed, etc.

There is no dedicated jetty for bulk cargoes and a huge quantity of steel scraps, our main raw materials, is being handled by lighterage vessels and it is adding to our costs. How can we export, when the cost of lighterage is immense. The cash subsidy being given presently on non-traditional exports is not enough to compete in the market. A cash subsidy at the rate of 10 per cent on export will gear up our earnings from steel exports in a big way. The government can enforce this for a few years until the foreign exchange crunch persists. Additionally, new cash subsidies are being discouraged right now, considering the country's future graduation from the LDC (least developed country) club. As a country we are not ready to get away from subsidies, so the government has to figure out how to keep allowing it. Still our infrastructure is not improved up to the expected level that can help reduce freight and local logistics costs. The country will need subsidies to propel exports. Just relying on domestic demand without increasing export will not support our overall growth.

FE: How will the economic zone help in industrialisation here in Bangladesh?

Alihussain Akberali: I don't think the economic zone will help in industrialisation in a big way in the short term, since development of at least the Mirsarai economic zone is still far away. Problems relating to road connectivity and water drainage have still not been resolved even after our investment in land and its development over the past four or five years.

Benefits in the economic zone and the existing company benefits are in a stark contrast. How will this help in creating a level-playing field? The problem is not with the benefits of the economic zone, rather the existing tax laws and rules are very complicated, tax rates very high and too much bureaucratic bottlenecks. Ideally the income tax rate should be 10 or 12% at best and in economic zones a total exemption for 10 years. The advantage at an economic zone is the one-stop service, hassle-free utilities, clean land and infrastructure which will help very much in industrialisation in the long-term. But what is promised needs to be delivered and quickly. Benefits are also changing and if they keep changing for the worse, then investment so far away in an economic zone will be discouraged. Why was the VAT on lease rent charged suddenly, when originally there was no such provision? The government sometimes wants to cut the cake and also eat it entirely which is not fair.

FE: Presently which crisis are you facing in your trade and commerce?

Alihussain Akberali: We need just quick response to our problems and proposals. But we are made to feel that we are beggars, when we approach government departments for any genuine support. Any genuine approvals done are seen as being done as a favour. This mentality needs to be changed.

It takes years to resolve some pressing problems and this really discourages us. We can give specific examples, if we are asked by the relevant government authorities. It is frustrating to get our genuine things done through the bureaucracy on a regular basis. We need to learn how efficient governments in Fareast Asia are working and what the attitude and systems of government machinery are there. With our current systems and attitude, we will not see much improvement in FDI (foreign direct investment).

For past few years we had been requesting our government to go for an elevated expressway between Dhaka and Chattogram. This was more important than the underground tunnel and the Payra port. We could have saved billions, if this elevated expressway was built. It was initiated few years back but then mysteriously it was dropped. Now again it is being initiated.

The bay terminal will see the daylight after 12 years of planning. It will take another 4 years for the port to be used. We are still in a suspense and exactly we don't know if we will save ourselves from stevedoring at Sadarghat. No one is giving us this assurance and saying what the plan is. Such plans should be clearly communicated so that businesses are able to plan ahead of time.

My only request is we need to be heard as soon as we approach the relevant authority. Unfortunately our people spend days, weeks or even months to follow up on our files! This attitude of not giving justice or decisions in time is a big deterrence for investment in our country. We need to be told 'yes' or 'no' but don't let our files gather dusts. The courage to take positive decisions is seriously lacking in the government machinery.

FE: How do the power and gas crises affect the industries and production?

Alihussain Akberali: For us power is not an issue, but for extension it is an issue. Gas is a serious problem. Even after enhancement of gas rates on many occasions, still gas is in a short supply which is really strange. For our new Tk. 25 billion (2500 crore) steel rolling mill a demand note was given for gas connection but we are yet to get the gas even after payment of money based on the demand note. Such delays really discourage us to do business. But we are used to such delays. But what about foreigners who are coming to invest in our country? Will they expect or understand such uncertainties?

FE: How can the government help the businesses and industries regain the momentum lost during the Covid-19 outbreak?

Alihussain Akberali: As I said earlier, we do not need any undue advantage from our government. We want to be heard and we want quick appointments with the relevant heads of the NBR and secretaries of ministry. Decisions this way or that way should be taken quickly so we can move forward or drop our project. JUST HEAR US IN TIME. There are a lot of serious and honest business houses in the country. Call them to hear their grievances and settle these and then all others will surely benefit. Everything is generally a one-way traffic in dealing with the government. If the government is creating a Large Taxpayer Unit (LTU) for large taxpayers, why not a strong team dedicated for these taxpayers to hear their issues, judge the performance of people in different departments on the delays and improve and correct the system. The government needs to continuously invest in infrastructure, education and social indicators to improve the overall living and economic conditions in the country. Such investment is down right now and the main reason is not enough tax revenue and inflation. The tax base needs to be widened in the country and for that many things can be done but capacity and initiatives are lacking on that front.

FE: Is the political crisis hampering the business now?

Alihussain Akberali: The business sentiment overall is affected when there is any tension over election. We hope better sense will prevail amongst all political parties and they will not disturb economic activities while doing politics. We must have a dialogue between all parties to move forward with an inclusive election. As citizens of the country, we want to see a festive and safe environment during the election period. We want to hear people and parties vying for seats in the assembly and learn what they will do for the country. We want to hear them and take our own personal decisions on whom to vote for. We do not get such an environment due to blockades, hartal, arson, burning of buses, etc. It affects the whole economy which benefits none.

FE: Do you have any suggestion for future generation and policymakers on how to increase trade and business? Please mention.

Alihussain Akberali: I tell you that the nation is highly energetic and hardworking. See our progress in areas like garments, cement, steel, ceramics, tea, seafood, vegetable growing, agriculture and now IT. When it comes to IT, we are making a fast stride in the Digital Bangladesh movement. See our GDP growth in the past 15 years. No wonder we are considered as the fastest developing country in the Fareast.

We need the bureaucracy to change their attitude and come forward and support each and everyone proactively and have the courage to take decisions without leaving the decision on someone else's shoulder.

Recently we saw the chairmen of BEZA (Bangladesh Economic Zones Authority) and BIDA (Bangladesh Investment Development Authority) visited our plants for the first time and you cannot imagine how happy we were. Industries like ours are national assets and if one does not see for himself, one will never realise what goes on at the backyard of steel manufacturing. We need a pat on our backs and you will see wonders we can do for our country.