Tata Tells Bangladesh - No Gas, No Investment
nkdat...@bigmailbox.net
New Age, Dhaka, Bangladesh
Monday, May 12, 2008
Govt-Tata talks find no answer to gas supply riddle
Khawaza Main Uddin
Joining the interim government-initiated talks on the $3-billion
investment proposals, India�s Tata Group on Sunday sought guarantee of
uninterrupted supply of natural gas for its planned steel and
fertiliser plants, said sources in the meeting.
The government side apprised the Tata negotiators of the country�s
depleting energy resources and said it was not possible now to supply
200 million cubic feet of gas daily as asked by the Indian
conglomerate for its planned plants. Currently, the shortfall of gas
supply is estimated at 150mmcf.
�If there is no gas, we cannot go ahead with our steel plant,�
Allan Roseling, executive director of Tata Sons, told journalists
after a marathon talk for about five hours with top officials at the
Board of Investment Sunday. The issue of guaranteed supply of gas was
part of earlier negotiations.
The Indian conglomerate will review and study the resources
situation in Bangladesh before making the final decision on
investment, said Roseling, who was aided in talks by two top officials
of the group � Indranil Sengupta and Syed Manzer Hussain.
BoI executive chairman Kamal Uddin Ahmed led the government side in
the talks. Energy secretary Mohammad Mohsin, power secretary Fouzul
Kabir Khan and industries secretary Mohammad Nurul Amin took part in
the discussion.
�We told them about the resource situation, gas scenario and coal
policy [in the making], which would form the basis for our
discussion,� said the investment board chief.
Roseling, too, admitted that the country�s gas reserve situation
was not in a state that the investor �wanted it to be�.
Apart from the issue of gas, the Tata group will also look at the
planned coal policy, which will mainly determine the mining method �
either underground or open-pit � , and see whether enough coal would
be made available for its proposed power plant.
The country is likely to add only 350mmcf gas per day in next three
years, compared to 10 per cent increase in demand every year,
according to an Energy Division forecast. Supply of gas from off-shore
fields is unlikely before eight years.
Neither BoI chief nor the Tata executive confirmed when the next
stage of negotiations would take place, though both described the
talks as �open-minded, fruitful and effective� at the current stage.
However, the Tata executive termed the interim government�s
attitude �forward looking� since it resumed the process of
negotiation, which remained stalled for almost two years.
The previous BNP-led alliance government entered into talks with
Tata in 2005 with much enthusiasm after the Indian industrial giant
had showed interests in investing in Bangladesh the previous year.
�The talks remained suspended for a long time for a number of
reasons. Now, there has been a change in this regard,� Kamal Uddin
said.
Roseling said the interim government had invited them to talks.
The stage for resumption of talks was set when Tata�s resident
director Manzer Hussain met commerce adviser Hossain Zillur Rahman and
the BoI chief recently.
The interim government�s move to resume talks with Tata came in a
stark contrast to a recent comment of the chief adviser�s special
assistant on energy M Tamim that no new gas connections would be given
shortly to the industries in Chittagong because of the persisting
shortfall.
The BoI chief still expressed optimism about attracting foreign
direct investment in Bangladesh in view of �congenial atmosphere,
manpower, tax regime and demand�. �I hope, more foreign investments
will come to Bangladesh,� he said.