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Bangladesh’s military-backed government will reopen negotiations with Indian conglomerate Tata on Sunday on the group’s record three-billion-dollar investment plan, officials said.

Senior Tata officials led by its executive director Alan Rosling will meet top government bureaucrats nearly two years after the conglomerate postponed what would be the biggest single foreign investment in Bangladesh.

The Indian salt-to-telecoms giant offered to build a steel plant, two power plants, a fertiliser plant and a coal mine back in 2006, after upgrading a 2004 plan.

Bangladesh investment board chief Kamaluddin Ahmed confirmed the talks, but refused to provide agenda details.

A Tata official said the group was encouraged by “positive indications” from the Dhaka government.

“Yes, there is an intention to move it forward,” said Tata’s Bangladesh chief Syed Manzer Hossain.

He said the company was ready to discuss all the issues.

“We submitted it in 2006 and it’s now 2008. Obviously there are some changes. The government may have some issues. We’ll evaluate the changing scenario after we meet,” he said.

Bangladesh has been under emergency rule since January 11 2007 when the president cancelled elections amid allegations of poll rigging.

The government has promised to “take up all necessary projects” to promote long-term economic growth and vowed to clean up corruption before restoring democracy and holding elections before the end of 2008.

The Bangladesh Nationalist Party government had promised a decision on the Tata project by June 2006.

But after two years of negotiations, it halted the deal, saying political sensitivities just ahead of the polls make it difficult to reach a decision and left it for a new government after parliamentary elections.

Anti-Indian sentiment is rampant among Bangladeshi voters as many believe India seeks to bully its smaller neighbor and political leaders traditionally fear being seen courting the regional power.

Source: Yahoo! News Service

Bangladesh and India are set to sign a supplementary deal next week on the commissioning of the Maitree Express, cross-border passenger train service between the two next-door neighbours, by Pahela Baishakh.

The Dhaka–Kolkata passenger train service will initially begin without a box-type temporary fence on no man’s land on the Bangladesh side as it is yet to complete its preparation for fencing, communications ministry officials told New Age on Wednesday.

The Bangladesh army chief, General Moeen U Ahmed, on his recent visit to India, said the cross-border train service may begin on Pahela Baishakh.

‘If everything goes well, the train will start running on Pahela Baishakh,’ Moeen told the newsmen after a visit to the Indian border station Gede on February 29. Pahela Baishakh falls on April 14 in both the countries this time.

‘As we have planned to move our customs and immigration point very near the international border, we need some more time to put up the fence,’ a high ministry official said.

Bangladesh will construct the fence similar to that of a tennis court and the design was in the final stages.

The ministry officials said the deal for the Maitree Express would be signed at a three-day inter-governmental railway officials’ meeting scheduled to begin on March 23 in Dhaka.

PN Verma, member (traffic) of the Indian railway ministry, will lead his country to the talks while the home team will be led by additional secretary of the Bangladesh communications ministry ATKM Ismail.

A high-level team, led by the Bangladesh home secretary, Abdul Karim, is scheduled to visit Darshana on March 21 to asses the preparation for immigration and security measures required at the immigration point on the Bangladesh side.

Bangladesh has initially set up the immigration centre in a rented warehouse at Darshana. The centre will later be shifted near the international border.

The cabinet on February 24 approved the Indian proposal for the construction of a box-type temporary fence on no man’s land between the two countries, clearing the way for the commissioning of direct passenger train service.

The proposal will be included in the Indo-Bangladesh agreement signed earlier, on the basis of which the train service will be in operation till mid-2010.

The commissioning of the train service was delayed as the two countries failed to narrow down their difference over ‘security cage’ on the railway.

As per the earlier agreement regarding the frequency of the service, two trains are supposed to run a week, one from Bangladesh and the other from India.

A train will leave Dhaka for Kolkata every Saturday and travel back to Dhaka on Sunday. Another train will leave Kolkata every Saturday and will go back on Sunday. The Maitree Express will have the capacity to carry 308 passengers at a time.

The Indo-Bangladesh passenger train will now run on the route between the cantonment station in Dhaka and Chitpur in Kolkata through the Darshana border.

Train fares will be between $8 and $20 depending on the class for the 536km journey — 416km in Bangladesh and 120km in India.

Dhaka and New Delhi signed the agreement on the resumption of direct train service in 2001. A series of meetings have taken place at different levels between the two sides since then.

Source: New Age, A Bangladeshi Daily.

Four new private airlines have rushed in to meet the fast-growing demand for air travel, seizing the initiative from Bangladesh Biman International, which has remained sluggish after its belated privatisation last year.

This is aviation boom time in Bangladesh with the launch of three private airlines in the last eight months and another set to start commercial flights next month.

Private airline operators say the industry is growing by 7.5-8 percent every year, with a market size of passengers alone swelling to around 35 billion takas ($6 million).

‘The aviation industry witnessed a 7.6 percent growth globally last year and it was also the same in Bangladesh,’ said Tasbirul Ahmed Choudhury, chairman and managing director of United Airways (BD) Ltd., which started operation in July 2007.

An ailing Biman, with its losses piled up and short of funds to refurbish its fleet, could not meet the passenger traffic last year, mostly of Bangladeshis working abroad, forcing the government to bring in foreign airlines to transport an estimated 130,000 passengers, who were on the verge of losing their jobs because of the delays.

Around four million passengers fly from Zia International Airport (ZIA) to different foreign destinations every year, while about 180,000 to 240,000 more aspiring passengers cannot go to the Middle East due mainly due to lack of seats, Wahidur Rahman of Anmole told The Daily Star newspaper.

Apart from United Airways, Best Air made its debut in mid-January and Aviana Airways, with the brand name Royal Bengal, in late January, both on domestic routes so far.

Earlier, GMG Airlines was the only private airline operating on domestic routes along with national flag carrier Biman Bangladesh Airlines Ltd.

Anmole Albab Airlines Ltd, another private airline, under the brand name of A2 Air is set to operate international passenger flights from Bangladesh in March this year.

Initially, it will operate flights to the Middle East and Far Eastern countries.

‘We have already completed all the procedures to collect two Boeing-747 aircraft to operate flights on international routes,’ said Wahidur Rahman Rana, chief financial officer of Anmole Albab Airlines.

Non-resident Bangladeshis’ contribution to the industry is significant as they, mostly from Britain and the US, have launched two of the four private airlines.

The private airlines are also planning to add more aircraft to their fleet so that flights can be expanded to international destinations.

United Airways has already purchased another Dash-8-100 and signed a letter of intent with a Singapore-based company to lease an Airbus A300 or A310. The airline is also negotiating to lease a Boeing 747 or 300.

Best Air is going to add another Boeing 737 to its fleet by March this year.

The new private airlines are operating domestic flights on Dhaka to Chittagong, Cox’s Bazar, Sylhet and Jessore routes so far.

Besides, GMG is operating international flights from Dhaka to Kolkata, New Delhi, Kathmandu, Bangkok, Kuala Lumpur and Dubai.

The other private airlines are also planning to launch international flights.

‘It’ll be very difficult to survive by operating only on domestic routes; it’s essential to go for international routes,’ said Tasbir of United Airways, founded by non-resident Bangladeshis mostly from Britain.

He also said they are now waiting for the government nod to operate international flights on Dhaka-Dubai-London, Dhaka-Kuala Lumpur, Dhaka-Dubai, Chittagong-Dubai, Dhaka-Kolkata, and Dhaka-Kathmandu routes.

Like United, Best Air is also planning to launch international flights.

‘We’ll start our international flights on the Dhaka-Bangkok route in March this year and on Dhaka to Kuala Lumpur, Kolkata, Chennai and Dubai routes within the next six months,’ said Mohsin Rana, acting manager (marketing and sales) of Best Air.

The private operators said seat utilisation of their aircraft ranges from 30 percent to 60 percent.

The ever-growing demand for air transport on international routes prompted them to go for international flights, they added.

Ranks Telecom Ltd (RanksTel), a PSTN (public switched telephone network) operator, yesterday launched its land phone services in Dhaka.

A Rouf Chowdhury, chairman and chief executive officer of RanksTel, a concern of Rangs Group, announced the launch of the services at a press conference in the capital.

“The operator is hopeful about bringing the whole Dhaka city under its coverage within the next three months,” said Chowdhury.

RanksTel is very sincere to offer services to its subscribers at lower rates both for local and international calls, he added.

Starting its journey in April 2005, RanksTel has now around one lakh subscribers around the country. The PSTN operator expects to reach three lakh subscriber within 2008.

At the beginning only Sylhet and Chittagong were under RanksTel coverage, but now it is operating from more than 34 districts, the press conference was also told.

Anwar Hossain, corporate affairs director of RanksTel, Md Ashraf Uddin Ahmed, director (Finance), Abul Basher, head of Finance, and Ahmed Ferdous, head of corporate sales, among other senior officials, were present at the press meet.

RanksTel is offering five prepaid and postpaid packages styled ‘Katha’, ‘Agamee’, ‘24-hour PCO (public call office)’, ‘Protishthaner Phone (organisation’s phone)’ and ‘Business Proceed’ for families, businesspeople and business houses.

Under the ‘Katha’ postpaid package, there will be five phones with two and three phone numbers.

The connection fee for two phones is Tk 6,500 and for three phones is Tk 9,500.

Under the package the subscribers will enjoy five friends and family (FnF) numbers and internet facility.

The connection fee for regular prepaid package ‘Agamee’ and postpaid package ‘Business Proceed’ is Tk 3,500 each.

The monthly fee for internet connection is Tk 500 for each connection of the two packages.

The connection fee for ‘24-hour PCO’ is Tk 3500, while internet connection charge is Tk 500.

The ‘Protishthaner Phone (organisation’s phone)’ that aims at group talks has two packages.

A Thailand-based private airline, Orient Thai Airlines, eyes to operate passenger flights from Dhaka, as the airline sees business friendly environment exists in Bangladesh.

Orient Thai Chairman Udom Tantiprasongchai unveiled the plan during a meeting with travel agents in Dhaka yesterday organised by Speed Aviation Limited.

An agreement between Orient Thai and Speed Aviation has also been signed for doing feasibility study to operate passenger flights from Dhaka, officials said.

Tantiprasongchai however pointed out that the three-month open sky policy by the Bangladesh government is not enough for airlines to start operations.

He sought travel agents’ cooperation to pursue Bangladesh government for extension of the open sky policy.

Industry experts said one factor attracting the fresh investment into the sector is the opportunity stemming from a backlog of some 150,000 people who have found jobs in Malaysia and the Middle East but are unable to fly due to shortage of flights.

In September, Malaysia-based budget airline AirAsia announced its operations from Bangladesh after Bangladesh adopted open sky policy allowing foreign airlines more flights.

The government approved open sky policy in September for three airports of the country for the next three months with a view to easing the air travel problems of Bangladesh nationals.

The aviation market in Bangladesh shows around 8 percent growth per annum, according to the industry experts.

Hicky Diaz of Speed Aviation also requested the travel agents to appeal to the government for extension of open sky policy.

Ehteshamul Haque, managing director of Travel Smart Limited, and Zaman, managing director of Vantage Travel, also spoke at the discussion.

Insurance companies have the legal and moral obligation to settle genuine claims as soon as possible, said the finance adviser, AB Mirza Azizul Islam, on Tuesday.

‘Why do you need external pressure [to settle claims],’ he asked a workshop on contribution of insurance to Bangladesh economy at a city hotel.

He was referring to certain claims that had remained pending for two to three years until 80 per cent of them to the tune of Tk 100 crore were settled on intervention of the chief controller of insurance four months ago.

Mirza Aziz urged the Bangladesh Insurance Association to set a standard of corporate responsibility and the association members to comply with it.

He also remarked that ‘soul-searching is needed to bring corporate good governance in the sector’.

The adviser said merger of insurance companies was one way to bring down the cost of operations as the local market was not big enough for as many as 62 companies to operate in.

He said he had taken an initiative to bring the insurance sector under the finance ministry from the commerce ministry and it would happen very soon.

He hinted at a change soon in the top management of Sadharan Bima Corporation as the state-owned insurance company had been facing some problems.

The chief controller of insurance, Mahfuzul Haque, said the insurance companies should go for credit rating for their own interests. ‘It is very important.’

Anomalies were detected at a number of insurance companies during a recent physical inspection of all the 62 companies operating in the country, he told the workshop.

‘My office provided each of the companies with its evaluation report and advised it to comply with the recommendations made in it,’ the CCI said.

Nizamuddin Ahmed, vice-president of Bangladesh Insurance Association, said more than 270 insurance claims worth about Tk 165 crore had been pending for years with the Sadharan Bima Corporation. He requested the finance adviser to look into the matter.

A BIA executive committee member, Abdul Matlub Ahmad, presented the keynote at the workshop.

The insurance sector earned over Tk 2,500 crore in gross premium and contributed Tk 111 crore to the exchequer in 2005, revealed the paper.

About 8 lakh people are employed in the sector directly or indirectly, Matlub said. He urged the finance adviser to amend the insurance laws through an ordinance and bring the sector under the umbrella of finance ministry as soon as possible. In his presentation, Matlub said the corporate tax should be lowered to 15 per cent from the existing 45 per cent. He hoped that in the next five years the insurance sector would be able to generate a premium income of Tk 10,000 crore and make an investment of about Tk 12,000 crore and contribution around Tk 500 crore to the exchequer in value-added and other taxes.

The cost of investment in Bangladesh is falling, although some hidden expenses threaten to erode the country’s competitiveness, a new survey reveals.

The 17th survey of investment-related cost comparison said Bangladesh has emerged as “the cheapest place” in Asia in terms of nine cost components, including legal minimum wages, social security burden ratio and charges of utility services.

“The relative position of Bangladesh against the components like salary of mid-level manager, legal minimum wage, rate of increase in nominal wage, telephone installation fees and call charges, mobile phone subscription fee, monthly basic mobile phone charge, cost of general use of per cubic meter gas, and cost of diesel has improved,” noted the survey, conducted by the Japan External Trade Organisation (JETRO).

Jetro conducted surveys in 30 Asian cities according to the 32 cost-components.
But some hidden costs, which are abstract by nature but exist in matters related to legal, policy, procedural system and infrastructure, have been playing a vital role in case of elevation of cost of investment, the report noted.

It said the poor law and order situation, delay in the settlement of letter of credit (L/C) payment, sudden changes in government policies, inadequate infrastructure facilities, and problem related to Chittagong port need attention of the government to reduce the hidden cost of investment.

For more to learn visit at http://www.financialexpress-bd.com/index3.asp?cnd=6/21/2007&section_id=1&newsid=64817&spcl=no

Anyone can discuss about this subject at here.

Industries adviser Geeteara Safiya Chudhury said on Monday that the government had launched a crusade for the revival of the country’s jute sector.
She also stressed the need for a 25-year industrial policy to avert abrupt policy shifts with the change of the government.
‘I have waged a crusade to make the jute sector viable and worthy for the country,’ Geeteara said at a seminar organised by the Economic Reporters’ Forum, wondering why jute was losing ground despite a growing demand for it across the world.
A comprehensive study would soon be undertaken by the industries ministry to decide the policy measures to make the jute mills viable and competitive in the international market.
The study, involving all stakeholders including trade union leaders, would see whether jute mills could be run viably under the government’s management or should be privatised, said Geeteara, also adviser for jute and textile, social welfare, and women and children affairs ministries.
‘Jute is in a bad shape with the public sector jute mills have been suffering from supply constraints of raw jute, non-availability of electricity and huge amount of outstanding bank loans,’ a frustrated Geeteara told the discussion at the Dhaka Reporters’ Unity conference room.
‘Buyers rush to neighboring India as we could not provide them with adequate supply on time.’
ERF in partnership with Katalyst, a donor-funded private sector promotional agency, organised the seminar, styled ‘National Budget for 2007-2008: What’s in the basket for SMEs’.
Dhaka Chamber of Commerce and Industry president Hossain Khaled, ERF president Zakaria Kajol and general secretary Nazmul Ahsan also addressed the seminar. Titu Datta Gupta, joint news editor, New Age presented the keynote paper on the issue.
The adviser told the seminar that the present government was keen to extend all-out supports for small and medium enterprises so that they could contribute more to the country’s economy and generate more employments.
The ensuing budget will address a number of major hindrances of SMEs, she hoped, without elaborating.
The adviser felt a long-term industrial policy would be more helpful for small, medium and large-scale industries than a five-year policy.
‘With the change of a government, new industrial policy is formulated, which hampers long-term industrial ventures of the entrepreneurs,’ she said.
Hossain Khaled said the government should withdraw turnover tax imposed at a rate of 0.50 per cent on small and medium enterprises.
‘It is unrealistic to tax SMEs on their turnover, which in no way proves profit of a business,’ the Dhaka chamber president said.
He said the SME refinancing scheme of Bangladesh Bank is so complicated that even banks are returning the money.
The chamber leader strongly suggested creation of ‘Banking Ombudsman’ to oversee the activities of central bank and scheduled banks.
He also demanded elimination of discretionary powers of taxmen and an end to bribery and harassment which discourage businesspeople to pay tax and deprive the government of due revenues.

Sources: Daily New Age