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48 out of 51 edible oil refineries operate without valid licences

by Naimul Haq
Forty-eight soyabean and palm oil refineries out of a total of 51 have been marketing products without having their licences renewed, according to sources in the Bangladesh Standard and Testing Institute (BSTI).
Owners of the refineries failed to renew their licences despite after several official reminders. "All the refineries have been manufacturing goods violating rules and procedures." said a BSTI official.
Only three refineries have applied for renewal of licences to continue production, which are in process. The others continue to import crude and market the finished products — soyabean and palm oil — without facing any action from the authorities concerned. All such violators can be indicted un-
der law but no step has been taken as yet. the official pointed out.
Vice Chairman of Bangladesh Soybean Oil Refinery Association Nazmul Haq Chowdhury. when contacted, admitted that there were a number of refineries which had not renewed their licences. But. he said. "Obtaining licence is not a problem for us. It is the government policy which is creating all the hindrances in the way of obtaining permission."
He further said, "the government wants that we pay BSTI certification marks (CM) fee at the rate of Ik 0.10 for every product manufactured, which is not reasonable. After paying high rate of taxes, making such other payments will hurt the refineries, already in
shambles. We pay more than 60 per cent tax and levy, which include 30 pc Import duty. 15 pc VAT. 5 pc development charges and Jamuna Bridge surcharge and others."
He also said, "the sector has already suffered serious setbacks. A number of refineries have closed down while others remain closed due to high production cost. Two years back, refineries which were able to produce more than 50 pc of their capacity paid fees at the rate of Tk 1.50 for every metric ton of crude used for manufacturing. But the authorities neglected our suggestion to reintroduce the fees."
The BSTI Council had decided to impose the CM fee of Tk 0.10. earlier fixed at Tk 0.15. The 39-member council, headed by the industries minister and comprising representatives of various business bodies including the FBCCI. decided in June to reduce the rate from Tk 0.15 to Tk 0.10 following requests from business leaders.
The fixed rate is illogical." said another member of the association. We imported more than three lakh metric tons of crude soyabean oil during 1990-1996. The industry was growing quite healthy until similar products from neighbouring countries started to be available at cheaper rates."
'We are ready to pay, but the fees have to be reasonable. As soon as the matter is resolved, we hope to obtain licence and start production in the closed refineries," he added.
There are 26 refineries in Dhaka zone and the rest 25 are In Chittagong zone. All refineries are to obtain licences as per provisions of the Special Regulation Order (SRO). A refinery gets licence after assessment by the BSTI which certifies that the factory is capable of producing goods of minimum standards set by the authorities.