Entrepreneurs to watch gas supply situation before further investment
Jasim Uddin Haroon | Tuesday, 15 July 2008
The country's leading industrial enterprises prefer to watch the gas supply situation before making any further investment that declined in fiscal 2007-08.
According to the Bangladesh Bureau of Statistics (BBS), the growth of private sector investment fell by 4.13 percentage points to 7.47 per cent in 2007-08. It grew by 11.6 per cent in fiscal 2006-07.
Industrialists also said a sluggish private investment will slow down growth of the economy squeezing the employment opportunities further.
President of Dhaka Chamber of Commerce and Industry (DCCI) Hossain Khaled said stoppage of new gas connection will frustrate industrial expansion.
"Not only the SMEs (small and medium enterprises) every business is seriously concerned following such stoppage of new gas connection," DCCI Chief added.
Abdus Salam Labu, vice chairman of S Alam Group, said are thinking to switch over to trading as there is no hope for new gas connection until 2011 in Chittagong.
"We have set up a large sugar mill in Chittagong. But we are yet to get gas connection although the construction was completed in January last," he told the FE.
Mohammed Ali, Chairman of Imam Group, said his group wants to concentrate further on trading as there is no scope for industrialisation for the time-being due to the gas and power crisis.
"How will we go for industrialisation when we are not assured of providing any gas connection?" he said.
However, the country's import of capital machinery dropped significantly in the just concluded fiscal. It fell by 27.5 per cent. During the period, letters of credit valued at US$ 1.39 billion were settled against $ 1.92 billion in 2006-07.
Mr Ali also said: "I have bought a generator having 1000 KVA capacity for my Imam Button factory, but after six months of procurement it still remains idle due to gas supply shortage," he added.
He said his company will concentrate more on the trading now. "I used to do trading worth Tk 1.0 billion a year, but I am now thinking of expanding it to Tk 1.5 billion this year," he added.
Imam Group generally imports rice, sugar, wheat and chemicals.
Mohammed Mustafa Haidar, a director of TK Group, told the FE that establishment of a number of industrial projects of the group with investment worth around Tk 3.0 billion faced uncertainty following the gas crisis.
"We want a clear picture on the gas reserve for investment," he added.
TK Group has planned to set up feed mill, spinning mill, and chemical plants in Dhaka and Chittagong.
Mohammed Iqbal, director of PHP Group, said his company has adopted a 'wait and see policy'. The company investment will get momentum only after assurance of gas by the government, he said.
"I am not thinking about any project right this moment. Our existing plants are doing well. But, we will not go for further expansion due to the gas crisis," Iqbal added.
The government has unofficially stopped giving new gas connection in Chittagong. Besides, there exists low pressure of gas in Dhaka, Gazipur, Narayanganj and Savar industrial belts.
According to the Bangladesh Bureau of Statistics (BBS), the growth of private sector investment fell by 4.13 percentage points to 7.47 per cent in 2007-08. It grew by 11.6 per cent in fiscal 2006-07.
Industrialists also said a sluggish private investment will slow down growth of the economy squeezing the employment opportunities further.
President of Dhaka Chamber of Commerce and Industry (DCCI) Hossain Khaled said stoppage of new gas connection will frustrate industrial expansion.
"Not only the SMEs (small and medium enterprises) every business is seriously concerned following such stoppage of new gas connection," DCCI Chief added.
Abdus Salam Labu, vice chairman of S Alam Group, said are thinking to switch over to trading as there is no hope for new gas connection until 2011 in Chittagong.
"We have set up a large sugar mill in Chittagong. But we are yet to get gas connection although the construction was completed in January last," he told the FE.
Mohammed Ali, Chairman of Imam Group, said his group wants to concentrate further on trading as there is no scope for industrialisation for the time-being due to the gas and power crisis.
"How will we go for industrialisation when we are not assured of providing any gas connection?" he said.
However, the country's import of capital machinery dropped significantly in the just concluded fiscal. It fell by 27.5 per cent. During the period, letters of credit valued at US$ 1.39 billion were settled against $ 1.92 billion in 2006-07.
Mr Ali also said: "I have bought a generator having 1000 KVA capacity for my Imam Button factory, but after six months of procurement it still remains idle due to gas supply shortage," he added.
He said his company will concentrate more on the trading now. "I used to do trading worth Tk 1.0 billion a year, but I am now thinking of expanding it to Tk 1.5 billion this year," he added.
Imam Group generally imports rice, sugar, wheat and chemicals.
Mohammed Mustafa Haidar, a director of TK Group, told the FE that establishment of a number of industrial projects of the group with investment worth around Tk 3.0 billion faced uncertainty following the gas crisis.
"We want a clear picture on the gas reserve for investment," he added.
TK Group has planned to set up feed mill, spinning mill, and chemical plants in Dhaka and Chittagong.
Mohammed Iqbal, director of PHP Group, said his company has adopted a 'wait and see policy'. The company investment will get momentum only after assurance of gas by the government, he said.
"I am not thinking about any project right this moment. Our existing plants are doing well. But, we will not go for further expansion due to the gas crisis," Iqbal added.
The government has unofficially stopped giving new gas connection in Chittagong. Besides, there exists low pressure of gas in Dhaka, Gazipur, Narayanganj and Savar industrial belts.