New factories outside economic zones denied power and gas supply

The Report Desk

Published: April 9, 2024, 03:46 PM

New factories outside economic zones denied power and gas supply

Photo: Collected

The government has announced stringent measures regarding the location of new factories, stating that electricity and gas supplies will only be provided to those set up within government-designated economic zones or industrial enclaves.

This decision was made during a meeting of the cabinet committee on economic affairs on March 21. Subsequently, the Bangladesh Bank issued a circular on this matter.

Under the new directive, banks are mandated to ensure that clearance certificates from utility service providers are obtained before approving loans for new industrial ventures.

While an earlier circular from the energy and mineral resources ministry in 2020 aimed to halt gas connections to industries outside designated zones, strict enforcement was lacking in the past three years.

Emphasizing the significance of planned industrialization for economic growth, the Bangladesh Bank stated, "Establishing industries at specific locations will ensure proper land and energy management as well as environmental development."

Mahbubul Alam, president of the Federation of Bangladesh Chambers of Commerce and Industry, hailed the decision, noting its potential to incentivize investors to establish factories within designated zones while also preventing industrial encroachment on agricultural land.

However, he stressed that the regulation should not apply to existing factories outside these zones, as imposing such restrictions could pose financial challenges for them.

Mohammed Amirul Haque, managing director of Premier Cement Mill, highlighted the need for the Bangladesh Economic Zones Authority to expedite utility services within economic zones to facilitate compliance with the new regulations.

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