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Tanners move slow on factory relocation

They demand compensation of Tk 1,090cr as relocation costs

Star Business Report
The relocation of tanneries from Hazaribagh to Savar is being delayed due to the owners' reluctance to move, mounting the threat of water contamination in the Buriganga river.
Bangladesh Small and Cottage Industries Corporation (BSC1C) has allocated 205 industrial plots to 155 tanneries in the 200-acre leather park at Hemayetpur, Savar.
Not only that, all necessary infrastructures — such as roads, water treatment plants, gas and sewerage line, electricity substation plant — except the central effluent treatment plant (CETP) — have been set up at the leather park.
But the tannery owners are yet to lay down the foundation stone for their factories, blaming the holdup on the failure to reach a consensus with the government regarding compensation and bank loans.
The tannery owners are now demanding compensation of Tk 1,090 crore, a readymade CETP and soft loans.
Leather and leather goods, including footwear, earned more than Tk 6,200 crore from exports in fiscal 2011-12.
The owners' reasoning being that they would have to build new infrastructures and repair machinery that would be damaged during relocation.
"We're demanding Tk 1,090 crore in compensation. But we
haven't heard anything from the government yet," said Shahin Ahmed, immediate past president of Bangladesh Tanners' Association.
The government proposed sharing costs for the CETP installations, which will require more thanTk 300 crore.
"But we signed a memorandum of understanding in 2003 with the government, and the government agreed to set up the CETP at its own cost," said Ahmed.
A central effluent treatment system is imperative for the export-oriented leather industry, Industries Minister Dilip Barua said, as most export destinations insist upon its use during the man-
ufacturing process.
Moreover, Bangladeshi leather goods will not have access to developed countries, including those in the European Union, if the government fails to set up the treatment plant by 2014, he said during a visit to the Savar leather estate yesterday. Barua expects the construction of the CETP to be completed by June next year and urged the tannery owners to start construction of factories on the allotted plots immediately.
“It is not a viable deadline as the construction of a normal ETP takes 2-3 years to finish the work,” M Belal Hossain, chairman of Bangladesh Finished Leather, Leather Goods and Footwear Exporters Association, told The Daily Star over phone.
Additionally, they are demanding another 200 acres of land in the proposed leather estate at Savar for building dumping yards and labour barrack for the workers.
The relocation process started nearly ten years ago following a High Court verdict in 2001.
The government, to accommodate the tanneries, began work on the leather estate more than five years ago.
The estate, which costTk 545 crore, remains unused and empty.
The tanneries located in Hazaribagh, Dhanmondi, Basila, Kamrangirchar and the surrounding areas continue to inflict its emissions upon the long-suffering residents of the western part of the city.
The stench of the tanneries can be smelt from miles into the residential areas like Rayerbazar and Zigatola.
More importantly, locals claim to frequently require treatment for skin diseases, fever, cough, gastroenteritis, asthma and diabetes.