Verdicts of circumstances on energy issues
Tuesday, 21 August 2007
Qazi Azad
THIS is the same country that has had a raging debate a few years ago about the desirability of export of its gas to India, which is now considering seriously to import it.
According to a report, published in some Dhaka newspapers last Friday, the government will not be able now to process the tenders for establishing 14 new power generation plants without being sure about its capacity to supply gas for the units. As such, the authorities are contemplating to import gas from Myanmar. A delegation from that country is expected here soon to hold talks on this matter.
While clamouring for gas export, its proponents and their supporters were wiser. They argued that it was not desirable to sit on a huge gas reserve while the country required investment funds badly for speeding up development. Some of the foreign companies, engaged in exploration and extraction of gas, also echoed this view loudly. A few of them even threatened to wind up their operation if the government delayed its decision on the matter of gas export for long.
The opponents of gas export, who have had a conservative estimate of gas reserve and maintained, with their facts and figures, that gas export would dangerously undermine the energy security of the country, were then openly derided as alarmists, ultra-rightists or ultra-leftists, fools having no grasp of realities and, worse of all, as anti-Indians.
At least temporarily, the naming might have made the policy makers in New Delhi and our friends in India dejected or angry at the conduct of the particular section of our educated people. Now the government leaders and other stalwarts in India must be thanking their stars for having not had a gas import agreement with this country. If they had it and laid the costly pipeline for drawing gas from our gas fields or from our national gas grid, they could now suck in more air, and not much gas. Thus, most of their investment would have turned into a melancholy venture and proved wastage and futile. The Indian industries that would have relied on our gas for firing their turbines, would have surely suffered operational dislocations and production loses. It seems that events are now proving that the opponents of gas export of that time are actually pro-Indians or friends of India.
Energy Adviser Tapan Chowdhury of this caretaker government is the first authoritative voice of his level in this country to have publicly uttered that we would have an acute shortage of gas after 2011. A few months have elapsed since he said so. Meanwhile, the gas supply shortage to some of our power generation plants has been recurrently undercutting their capacity utilization at this time of chronic power supply shortfall, proving the skill of the adviser in interpreting facts for a proper assessment of a situation.
Following his public remark about the known level of gas reserve, it was widely anticipated that the present caretaker government would soon give the final words on the investment proposal of Tata, which envisages, among others, utilizing gas for production of steel in this country for purpose of export. The executive chairman of the Board of Investment, who has just retired, also mentioned at one stage that a decision on the proposal would be made soon. But many weeks have passed since then. The final words are still awaited.
The fact of the Indian company waiting for more than 15 months, since the time of the last elected government, for our final words on its particular proposal for investing here $3.5 billion in manufacturing units does not make good publicity materials for this country. It impairs our image as a nation that can readily give a decision on a big foreign investment proposal. The sloth in dealing with a major issue like this, due to indecision -- apparently prompted by hesitation, invariably sends out a negative signal to prospective foreign investors. It is a matter so oft told by various quarters that it actually requires no longer any mention. As a reputed economist is now running the government, the redundancy of it is clearer.
It is now widely held that the interim government would pass on the responsibility of taking the final decision on the proposal to the next elected government. But an elected government, with expressed grassroots support, may have greater capacity to create on their looms meaningless public pledges to reinforce populism. But they will never have any skill to generate non-renewable resources at will. Why then this long wait?
This caretaker government, as indicated by its work schedule, would be in power for a further period of more than a year. More delay in giving Tata the final words on its investment proposal by as long a time-in fact, it is to be longer, would further tarnish the image of the country. The next elected government, as usual, will take time to settle in office and begin to address serious issues.
It does not appear that our long delay in this regard has automatically conveyed to Tata or to the Indian authorities our inability to host the Indian company. The Indian state minister of commerce, Mr. Jairam Ramesh, categorically mentioned, while he was recently in Dhaka, about New Delhi's expectation about Bangladesh giving its nod to Tata's investment proposal, alongside to a few other Indian proposals.
The energy secretary here has indirectly indicated in course of a recent public discussion at a local hotel that Tata's proposal for establishing the gas-based steel plant is rejected by circumstances. His words with journalists, after the discussion, are to be carefully interpreted to find out this ultimate message. He claimed to have himself advised the power division to go more for coal-based power plants in future as the current known gas reserve is not encouraging and is depleting fast. When we are telling our own organizations not to rely on gas supply in future, is there any scope to host any foreign company that aims at depending on our gas for its proposed manufacturing operation here?
The fast dwindling gas reserve is also telling us that the draft coal policy must aim at the nation's energy security. Coal export for cash or to facilitate its mining will fast deplete our non-renewable energy resource at hand. It will make us precariously dependent on external energy sources at a time of increasing power play centering energy.
In the 20 or 25 year from now, when both India and China would become economic super-powers and some other Asian countries, including Thailand, would be major industrial powers, the thirst for energy will definitely sky-rocket. This power play might then gain unimaginable intensity.
But Bangladesh will then have to survive and continue to prosper. We can think of coal export only when we will have reliable capacity to meet our increasing power need from other local sources, like nuclear plants manufactured and installed here by reputed foreign firms.
The best feasibility report is always the one whose workability has been determined taking into consideration all known and possible odds. Bangladeshis must not be fools not to realise what can be mortally risky. Our approach to national energy security has to be based on assured access to energy resources and not at all on assumptions.
THIS is the same country that has had a raging debate a few years ago about the desirability of export of its gas to India, which is now considering seriously to import it.
According to a report, published in some Dhaka newspapers last Friday, the government will not be able now to process the tenders for establishing 14 new power generation plants without being sure about its capacity to supply gas for the units. As such, the authorities are contemplating to import gas from Myanmar. A delegation from that country is expected here soon to hold talks on this matter.
While clamouring for gas export, its proponents and their supporters were wiser. They argued that it was not desirable to sit on a huge gas reserve while the country required investment funds badly for speeding up development. Some of the foreign companies, engaged in exploration and extraction of gas, also echoed this view loudly. A few of them even threatened to wind up their operation if the government delayed its decision on the matter of gas export for long.
The opponents of gas export, who have had a conservative estimate of gas reserve and maintained, with their facts and figures, that gas export would dangerously undermine the energy security of the country, were then openly derided as alarmists, ultra-rightists or ultra-leftists, fools having no grasp of realities and, worse of all, as anti-Indians.
At least temporarily, the naming might have made the policy makers in New Delhi and our friends in India dejected or angry at the conduct of the particular section of our educated people. Now the government leaders and other stalwarts in India must be thanking their stars for having not had a gas import agreement with this country. If they had it and laid the costly pipeline for drawing gas from our gas fields or from our national gas grid, they could now suck in more air, and not much gas. Thus, most of their investment would have turned into a melancholy venture and proved wastage and futile. The Indian industries that would have relied on our gas for firing their turbines, would have surely suffered operational dislocations and production loses. It seems that events are now proving that the opponents of gas export of that time are actually pro-Indians or friends of India.
Energy Adviser Tapan Chowdhury of this caretaker government is the first authoritative voice of his level in this country to have publicly uttered that we would have an acute shortage of gas after 2011. A few months have elapsed since he said so. Meanwhile, the gas supply shortage to some of our power generation plants has been recurrently undercutting their capacity utilization at this time of chronic power supply shortfall, proving the skill of the adviser in interpreting facts for a proper assessment of a situation.
Following his public remark about the known level of gas reserve, it was widely anticipated that the present caretaker government would soon give the final words on the investment proposal of Tata, which envisages, among others, utilizing gas for production of steel in this country for purpose of export. The executive chairman of the Board of Investment, who has just retired, also mentioned at one stage that a decision on the proposal would be made soon. But many weeks have passed since then. The final words are still awaited.
The fact of the Indian company waiting for more than 15 months, since the time of the last elected government, for our final words on its particular proposal for investing here $3.5 billion in manufacturing units does not make good publicity materials for this country. It impairs our image as a nation that can readily give a decision on a big foreign investment proposal. The sloth in dealing with a major issue like this, due to indecision -- apparently prompted by hesitation, invariably sends out a negative signal to prospective foreign investors. It is a matter so oft told by various quarters that it actually requires no longer any mention. As a reputed economist is now running the government, the redundancy of it is clearer.
It is now widely held that the interim government would pass on the responsibility of taking the final decision on the proposal to the next elected government. But an elected government, with expressed grassroots support, may have greater capacity to create on their looms meaningless public pledges to reinforce populism. But they will never have any skill to generate non-renewable resources at will. Why then this long wait?
This caretaker government, as indicated by its work schedule, would be in power for a further period of more than a year. More delay in giving Tata the final words on its investment proposal by as long a time-in fact, it is to be longer, would further tarnish the image of the country. The next elected government, as usual, will take time to settle in office and begin to address serious issues.
It does not appear that our long delay in this regard has automatically conveyed to Tata or to the Indian authorities our inability to host the Indian company. The Indian state minister of commerce, Mr. Jairam Ramesh, categorically mentioned, while he was recently in Dhaka, about New Delhi's expectation about Bangladesh giving its nod to Tata's investment proposal, alongside to a few other Indian proposals.
The energy secretary here has indirectly indicated in course of a recent public discussion at a local hotel that Tata's proposal for establishing the gas-based steel plant is rejected by circumstances. His words with journalists, after the discussion, are to be carefully interpreted to find out this ultimate message. He claimed to have himself advised the power division to go more for coal-based power plants in future as the current known gas reserve is not encouraging and is depleting fast. When we are telling our own organizations not to rely on gas supply in future, is there any scope to host any foreign company that aims at depending on our gas for its proposed manufacturing operation here?
The fast dwindling gas reserve is also telling us that the draft coal policy must aim at the nation's energy security. Coal export for cash or to facilitate its mining will fast deplete our non-renewable energy resource at hand. It will make us precariously dependent on external energy sources at a time of increasing power play centering energy.
In the 20 or 25 year from now, when both India and China would become economic super-powers and some other Asian countries, including Thailand, would be major industrial powers, the thirst for energy will definitely sky-rocket. This power play might then gain unimaginable intensity.
But Bangladesh will then have to survive and continue to prosper. We can think of coal export only when we will have reliable capacity to meet our increasing power need from other local sources, like nuclear plants manufactured and installed here by reputed foreign firms.
The best feasibility report is always the one whose workability has been determined taking into consideration all known and possible odds. Bangladeshis must not be fools not to realise what can be mortally risky. Our approach to national energy security has to be based on assured access to energy resources and not at all on assumptions.