Tanners meet JICA to get $1b loan for relocation

Tanners held a meeting with the Japan International Cooperation Agency (JICA) officials Thursday for $1.0 billion loan to meet relocation cost of their units from the city's Hazaribag to Savar Tannery Estate.
The meeting was held after the tanners wrote a letter to JICA recently for providing the financial assistance, as the owners are unable to relocate around 200 tanneries on their own.
Bangladesh Finished Leather, Leather Goods & Footwear Exporters Association (BFLLFEA) President Mohammad Abu Taher and JICA Advisor Yasuhiko Yuga led their respective teams at the meeting at JICA office.  
The BFLLFEA president told The Financial Express (FE): "We talked for around one hour, and they showed positive sign regarding the credit… but nothing is final yet."
JICA officials will visit the tannery estate very soon, and after completing necessary studies they will think of providing the loan.  
"We dearly need long-term loan with low interest rate for the relocation. We can't bear all costs of relocation. If we do it, we can't run our business."
Earlier, the tanners also met Bangladesh Bank (BB) Governor Dr Atiur Rahman for financial assistance.
"We met the BB Governor… he did not give us any concrete assurance. But he said he would try to find a solution for us," he added.
The government has already given the final approval of setting up the Central Effluent Treatment Plant (CETP), which has been an apple of discord for a long time between the authorities concerned and the tanners.
The tannery owners said they will begin relocating their units from April.
The tanners and the government signed a memorandum of understanding (MoU) in October last to ensure relocation of Hazaribag tanneries to Savar Tannery Estate.
According to the MoU, the government has decided to provide Tk 2.5 billion as compensation to the tanners for relocation as well as to give Tk 6.63 billion or 80 per cent of the total project cost.
However, the owners will have to pay the remaining 20 per cent or Tk 1.65 billion in installments.
Mohammad Abu Taher said though it is not final yet, the tanners may get half of the compensation (Tk 2.5 billion) before relocation.
"The amount is so small. Tk 2.5 billion was promised 10 years ago. Now it is not enough."
Tannery owners also have a plan to build a modern township on around 50 acres of land at Hazaribag after shifting their factories to meet the relocation cost.
"We have discussed the issue in our forum, and decided to construct a planned housing project in the area under a joint venture or a single initiative," Mr Taher concluded.