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MAKING USE OF UNUSED LANDS

Expectations from the merger of BOI and Privatisation Commission

Zahid Hossain
THE government has recently taken a decision to merge the Board of Investment (BOI) and the Privatisation Commission to quicken the process of boosting investment and industrialisation in the county. The prospective investors, entrepreneurs and the chamber bodies generally consider it a positive decision.
This merger process will be really useful and effective only when well-planned and well-organised measures are undertaken for effective utilisation of the un-utilised lands and other services of state-owned enterprises and few other government organisations in the services sector.
This merger process will no doubt go a long way in attracting both local and foreign investors, provided genuine investors and entrepreneurs are allowed to have access to the lands and other such facilities of the closed state owned enterprises on a competitive basis.
The former finance minister, late SAMS Kibria, while speaking at a board meeting of the BOI in 1998, when I was working as the executive chairman of the organisation, raised a complaint which he would very often receive from prospective foreign investors. He had said that it would sometimes be difficult
for prospective investors to stay at their hotel because of annoying, unsolicited offers by land dalals, who promised promising land deals at odd hours. Unfortunately, after so many years, the situation remains more or less unchanged.
In fact, availability of an appropriate plot of land - whether it is a government khas land or a land from private individuals - to set up an industry is a major problem for prospective investors. The issue of transfer of land ownership is equally problematic and many foreign investors in the past immediately left the country once they came to know of the practical problems as well as the existing rules for acquiring the ownership of land to set up an establishment in Bangladesh.
Officially, the BOI is supposed to arrange appropriate land for prospective investors. But practically speaking, the BOI can only send recommendations. The Ministry of Land has the actual authority to allot or sell the land in question. Moreover, the existing procedures for transferring government land to any individual or private company to set up an establishment is cumbersome and time consuming. Even in the recent past, construction work of many power plants could not begin on time due to the delay in getting possession of the allotted land.
The BOI, when contacted, was not able to furnish the exact figure of successful
entrepreneurs who received the required land from government agencies with their recommendation. According to the World Bank sponsored Investment Climate Survey conducted in Bangladesh a few years back, different chamber bodies and industrial entrepreneurs generally complain that in most cases, entrepreneurs have to buy the recommendation at a huge cost.
Therefore, in order to ensure investment friendly atmosphere in the country, the availability of appropriate land for setting up industries - small, big or SMEs - easy, quick and hassle-free procedures for the procurement of land needs to be ensured. Moreover, the ownership deed needs to be updated in order to attract investors. Also, if utility services such as water, gas and power are not already provided, quick arrangements should be made to install these services within the establishment.
According to the Bureau of Statistics, approximately only 18,084,000 acres of the total land area of Bangladesh is now being used for agricultural purpose, particularly for the production of crops and vegetable, for a population of more than 16 crores. Therefore, we need to think carefully before deciding to allot land used to produce food for any other purpose, especially considering the ever increasing demand for food in the country.
It is also equally true that industries and
production houses need to be set up in larger and increasing numbers to produce essential items to meet our local demand as well as for export purposes. Also, efforts must be taken to set up appropriate industries to use locally produced raw materials as well as to create job opportunities.
There were about 350 industrial plots, each of about two acres, in the Tejgaon industrial area. But unfortunately, most of these plots are now being used for other purposes and no strict measures are being taken against the violators of existing rules. A similar situation is prevailing regarding the use of land in over 200 industrial plots in Nasirabad, Chittagong. The present position of all these industrial areas need to be properly evaluated, and appropriate actions need to be taken by the government to identify excess or unused land so as to allocate them for industrial use.
A large number of jute factories, under the Bangladesh Jute Mills Corporation, have been closed largely due to mismanagement. Those units each have an area of approximately 60 to 25 acres of land which now remain unused. Located mostly in Chittagong and Khulna, these factories are most unlikely to be in operation again, although the present government has already announced that these mills will be restarted as soon as possible. In the same way, 10 units of 15 acres of land under the Bangladesh Chemical Industries
Corporation (BCIC), according to a source of the corporation, has been closed, but the BCIC authorities do not even know what's going to happen there. The future of five units under the Steel and Engineering Corporation is also uncertain.
In the country-wide 74 Industrial Estates of Bangladesh Small and Cottage Industries Corporation (until Sept 2009), the number of industrial plots was 3,709, while a total of 3,532 plots have been allotted to different individuals and companies. But unfortunately, production has begun in only 1,594 plots. The eight zones of Bangladesh Export Processing Zone Authority have a total of 2,391 acres of land to themselves. Except Dhaka and Chittagong zones, the rest of the six zones have several vacant plots. Newer zones like Comilla, Ishwardi, Uttara and Mongla, as has been reported in the media, have not really been able to attract investors so far.
Since these excess lands have every infrastructural facility like power, gas and communication networks, we now need to ask whether these excess lands can be effectively and more usefully utilised to set up other industries. In my opinion, the answer is a resounding yes.
The writer Is a former executive chairman of BOI. E-mail: zahid_hossaln 2004@hotmall.com