Friday, Oct 15, 2004
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By Haroon Habib
DHAKA, OCT. 14. The Tata group has signed an Expression of Interest (EoI) with the Bangladesh's Board of Investment (BoI), getting a go-ahead for its planned $2 billion investment, the biggest investment in the country since independence. The deal sets the ground for a series of negotiations on the Tata group's intent on setting up a 1,000 MW power station (in two phases), a steel mill with a capacity of 4.2 lakh tonnes annually (also in two phases), and a one million tonne fertilizer unit. All the plants will be based on the country's natural gas.
To evaluate pricing
The Government said it would now evaluate with donors' help the pricing and supply of gas for the proposed plants.
The demand list of the Tata group, making the huge investment, includes uninterrupted supply of gas for its proposed plants for 20 years, a competitive price for the gas they would use, quick facilitation of its investment proposal and selection of suitable sites. It is learnt that the Government, in principle, has agreed to most conditions but the main point of negotiations would be centred on the pricing and supply of natural gas.
The much-publicised signing ceremony was held here yesterday, where the visiting Tata group Chairman, Ratan N. Tata, and senior Bangladesh ministers including the Finance and Planning Minister, M. Saifur Rahman, the Foreign Minister, M. Morshed Khan, and the Indian High Commissioner, Veena Sikri, were present.
Firdose A. Vandrevala, Managing Director of Tata Power, Prasad Menon, MD of Tata Chemicals, B. Muthuraman, MD of Tata Steel, and Md Nazrul Islam, BoI Member, signed the agreement.
"Given the global trend of rising gas and oil prices, I think gas supply will be a crucial issue in the deal. We will have to take care of national interests before signing the gas guarantee deal with the Tata group,'' Saifur Rahman said.
The Finance and Planning Minister assured the Tata group with all support to establish its plants, which would give a new dimension to India-Bangladesh trade relations.
The BoI Executive Chairman, Mahmudur Rahman, said the implementation process of the proposed projects might start in six months. A memorandum of understanding might be signed in December when details of the proposals would be finalised.
Mr. Tata, who is on a two-day visit here, said, "We want to make genuine investment which can generate employment here. We are committed to making it a reality as early as possible,'' adding that "We want to be associated with Bangladesh's prosperity through the investment.''
Part of global plan
Mr. Tata has said his group has decided to single out Bangladesh as a new investment location, given a host of opportunities the country offers. He said the Tata group had decided to invest in Bangladesh as part of its plan to go international.
"We [want to] play a role in the economic development of the country... and [would like to] see the country prosper,'' he told a luncheon meeting, hosted by the Foreign Investors' Chamber of Commerce and Industry at a hotel here on Wednesday.
Besides the opportunities in its fast-growing market, Bangladesh shared "a common culture and a common boundary with India,'' he said as he explained the reason to choose the country as major investment destination.
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