Private power producers such as Adani Power and Reliance Power have robust investment plans for Bangladesh’s energy sector, India’s High Commissioner to Bangladesh Harsh Vardhan Shringla told Business Line in an interview prior to the visit of Bangladesh Prime Minister Sheikh Hasina to India from April 7 to 10. He said this visit will add a new chapter in India-Bangladesh ties. Excerpts:
Q: What do you expect from the upcoming visit of Prime Minister Sheikh Hasina to India?
A: Prime Minister Sheikh Hasina’s visit will add a new chapter to the deepening relationship between India and Bangladesh.
The visit is expected to further bilateral cooperation in several areas, including development cooperation and high technology such as IT, ITeS, cyber security and space.
The visit will also provide an opportunity to comprehensively review the developments made on the decisions taken during the visit of Prime Minister Narendra Modi to Bangladesh in June 2015.
Q: What is the status of the proposed investment plans by Reliance and Adani in Bangladesh’s energy sector?
A: Indian companies in the private as well as the public sector are increasingly showing interest in the energy and power sector in Bangladesh. Reliance intends to generate 3,000 MW using LNG from a Floating Storage Regasification Unit (FSRU) to be installed by it. The first phase of this project for generation of 700 MW in Meghnaghat has been approved. The Adani Group intends to supply power using dedicated transmission lines to Bangladesh from the two 660 MW plants to be set up in Jharkhand. In addition, public sector companies such as Petronet, IOCL and the Numaligarh Refinery Ltd have also expressed interest in the oil and gas sector in Bangladesh. In January 2016, the Adani Group and Reliance ADAG announced their intent to invest around $11 billion in power, LNG and ports sectors in Bangladesh.
Q: Bangladesh has been complaining about India imposing non-tariff barriers on jute exports. Has this been sorted out?
A: The issue of anti-dumping duty on export of jute products from Bangladesh to India is being discussed between the governments. It may be noted that the investigation and the consequent imposition of anti-dumping duty on exports of jute products was a quasi-judicial process. However, considering the special relationship that India has with Bangladesh, a consultation on this issue was organised in Kolkata between the officials concerned from both the countries in April 2016. Also, opportunity was given to Bangladesh jute exporters to present their case along with relevant data before the investigating authorities. Duty levied on some of the companies that participated in the investigation is zero or very small.
Q: Is Bangladesh satisfied with Indian investments there?
A: Total Indian investments in Bangladesh registered with the Bangladesh Investment Development Authority are worth more than $3 billion. Companies such as Tata Motors, Hero MotoCorp, Sun Pharma, Godrej, VIP, CEAT Tyres, Dabur, Airtel, Aditya Birla Cement etc., have set up or are establishing their manufacturing facilities in the country. There is great potential in Bangladesh for further investments from India. Adding to this are investment proposals made by Reliance and Adani. Bangladesh has also offered India two sites for setting up economic zones, exclusively for Indian companies.
Q: What is the progress on operationalising BBIN Motor Vehicles Agreement (MVA), now that Bhutan has delayed its ratification?
A: The trial run of a truck carrying cargo from Dhaka to Delhi under the BBIN (Bangladesh-Bhutan-India-Nepal) agreement was carried out successfully in September 2016. This was an encouraging development. We are keen to see the agreement operationalised, as besides improving connectivity, the agreement will lead to immense savings in transaction cost and time for the business community.
Q: What is the status on giving India access to Chittagong Port?
A: During the visit of the Prime Minister of India to Bangladesh in 2015, a memorandum of understanding on the use of Chittagong and Mongla ports for movement of goods to and from India was signed.
Negotiations are underway to operationalise the agreement to the benefit of people of both countries. We expect its operationalisation to incentivise economic development along this route. Trans-shipment of goods to North-Eastern States of India through Ashuganj river port and further movement through Akhaura-Agartala by road has commenced in June 2016.
The Coastal Shipping Agreement signed during the visit of the Prime Minister in 2015 has also been operationalised. February 2016 saw the commencement of the first container services between Kolkata and Pangaon (around 20 km from Dhaka) under the agreement.