Ensuring power and gas to industries
Wednesday, 9 July 2008
OUT of sheer desperation, an entrepreneur, who has invested nearly Tk. 4.0 billion in a vegetable oil refining plant in the port city of Chittagong has recently filed a writ petition with the High Court Division seeking gas connection to help make his plant operational. According to a newspaper report, about 300 small and big industries in the Chittagong region having invested an estimated amount of Tk.25 billion are awaiting gas connections. The scenario is not also different in other parts of the country. Scores of newly established industrial units in Dhaka and its adjoining areas have not been able to start production because of non-availability of gas.
The industrial units that are now in operation across the country are also having a tough time because of irregular supply of gas mainly used for running captive power generators during frequent power failures and dyeing units of large composite textile mills. Industries in the adjoining areas of Dhaka, including Narayanganj, where most of the export-oriented knitwear factories are located, remain these days gas-starved from 9:00a.m. until noon everyday. And gas-pressure, according to the industrialists, during the remaining part of the day remains well below the required level. The operational cost of diesel-fired power generators has more than doubled because of frequent load-shedding and the recent hike in diesel price.
An end to the sufferings being caused to industrial units due to power and gas shortages, apparently, is not in sight. In the days following the take-over of the rein of the country's administration, the incumbent caretaker government had cited instances of failures and wrongdoings by the past governments in power and energy sectors. The people, obviously, expected some improvement in the situation under a government which has the freedom in making prompt decisions in the absence of interference by the vested interests. Unfortunately, their hope has been belied and the situation in both power and gas sectors has rather worsened. However, the reasons, in many cases, for failure in improving the situation might have been different from those of the past. But the reality is that power and gas shortage have emerged as a serious threat to uninterrupted industrial production and exports and new investment possibilities. The statement made by special assistant to the chief adviser Dr. M. Tamim, who is in-charge of the power and energy ministry, some weeks back on gas situation has come as a rude shock to the existing as well as potential entrepreneurs. Dr. Tamim talked about gas-rationing to existing industries and ruled out the possibility of gas connections to new industries.
One does have enough reasons for getting perplexed by the prevailing gas and power scenario. Why should an entrepreneur make investment in new industries watching the plight of the existing ones? The finance and planning adviser in the budget for the current financial year has been generous in terms of duty rates on raw materials, capital machinery and intermediate goods with a view to boosting industrial output and wooing new investments. But the offers are unlikely to make much headway in the absence of ensured supply of power and gas. However, improvement in power situation depends on the availability of enough of gas supply, the possibility of which seems remote in the short-term. In that event, serious questions arise over the need at this stage for making new investments, public and private, in gas-fired power stations when the supply of gas is one of the prime constraints to operating the existing power generation units in the country? Only one option, it seems, is now left open to meet the immediate need is the extraction and use of large coal reserves for power generation. The policy-makers must also be aware of this fact. But it would require adoption of the coal policy that has already attracted a lot of controversies. Will the caretaker administration take the risk of approving it?
The industrial units that are now in operation across the country are also having a tough time because of irregular supply of gas mainly used for running captive power generators during frequent power failures and dyeing units of large composite textile mills. Industries in the adjoining areas of Dhaka, including Narayanganj, where most of the export-oriented knitwear factories are located, remain these days gas-starved from 9:00a.m. until noon everyday. And gas-pressure, according to the industrialists, during the remaining part of the day remains well below the required level. The operational cost of diesel-fired power generators has more than doubled because of frequent load-shedding and the recent hike in diesel price.
An end to the sufferings being caused to industrial units due to power and gas shortages, apparently, is not in sight. In the days following the take-over of the rein of the country's administration, the incumbent caretaker government had cited instances of failures and wrongdoings by the past governments in power and energy sectors. The people, obviously, expected some improvement in the situation under a government which has the freedom in making prompt decisions in the absence of interference by the vested interests. Unfortunately, their hope has been belied and the situation in both power and gas sectors has rather worsened. However, the reasons, in many cases, for failure in improving the situation might have been different from those of the past. But the reality is that power and gas shortage have emerged as a serious threat to uninterrupted industrial production and exports and new investment possibilities. The statement made by special assistant to the chief adviser Dr. M. Tamim, who is in-charge of the power and energy ministry, some weeks back on gas situation has come as a rude shock to the existing as well as potential entrepreneurs. Dr. Tamim talked about gas-rationing to existing industries and ruled out the possibility of gas connections to new industries.
One does have enough reasons for getting perplexed by the prevailing gas and power scenario. Why should an entrepreneur make investment in new industries watching the plight of the existing ones? The finance and planning adviser in the budget for the current financial year has been generous in terms of duty rates on raw materials, capital machinery and intermediate goods with a view to boosting industrial output and wooing new investments. But the offers are unlikely to make much headway in the absence of ensured supply of power and gas. However, improvement in power situation depends on the availability of enough of gas supply, the possibility of which seems remote in the short-term. In that event, serious questions arise over the need at this stage for making new investments, public and private, in gas-fired power stations when the supply of gas is one of the prime constraints to operating the existing power generation units in the country? Only one option, it seems, is now left open to meet the immediate need is the extraction and use of large coal reserves for power generation. The policy-makers must also be aware of this fact. But it would require adoption of the coal policy that has already attracted a lot of controversies. Will the caretaker administration take the risk of approving it?