Tata still optimistic about Bangladesh project

South Asia News

Tata still optimistic about Bangladesh project

Dhaka, July 6 (IANS) India's Tata Group's Bangladesh project head has denied media speculation that the conglomerate was pulling out because the present Khaleda Zia government considers the proposed $3 billion deal 'risky' for political reasons.

Manzer Hossain, the project director, expressed optimism that the Bangladesh government would sit with the company on July 10 to clarify its position on the proposed investment for a 1,000-MW power project, a steel mill and a fertiliser unit in the country.

A high-powered team from Tata Group headed by its Executive Director Alan Rosling will visit Bangladesh to meet government officials. The Tata officials are expecting a positive response from the government at the meeting.

However, The Daily Star newspaper, in a detailed report said 'uncertainty seems to be looming large due to the government's unusual delay in giving an approval'.

Media reports in Bangladesh have said that the government is delaying a decision for political reasons. The deal is considered 'risky', with the upcoming parliamentary elections.

Energy Ministry Adviser Mahmudur Rahman told the media that the government may reach a consensus with the Indian group so that the next elected government can sign an agreement after assuming office.

Tata Group in its latest revised ambitious proposal had asked the government to reply by the end of May this year, but the government failed to reply within the deadline.

The conglomerate had on April 20 this year formally submitted its initial proposal to invest $2.5 billion for setting up a 1,000 MW power plant, a steel mill with 4,20,000 tonne annual production capacity and a fertiliser unit with one million tonne production capacity.

UNB, a Bangladeshi news agency, quoting an Indian newspaper, said: 'Tata Group has finally decided to withdraw an ambitious $ 3 billion investment proposal for undertaking several big ventures in Bangladesh, following delays in taking a decision by the host country.'

Tata's Manzer Hossain said the media interprets things on its own while Tata Group and the government have yet to make their positions clear.

However, he expressed the group's concern over the government's delay saying that nobody can wait an indefinite period of time to invest.

'The delay is definitely a cause of concern for Tata Group but we are still optimistic about the project,' Manzer told the Daily Star.

The Bangladesh government and Tata Group agreed to kick off formal negotiations on May 25 and to wind it up by Aug 31 to clear the way for signing an agreement before Nov 30 this year.

Ratan Tata, chairman of the corporate house, visited Bangladesh last October to discuss the investment proposal with the Bangladesh authorities.

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Tata still optimistic about Bangladesh project