Mirsarai’s Indian SEZ construction to get momentum soon

The construction work of the Indian special economic zone (SEZ) at Mirsarai in Chattogram is most likely to get momentum as the Bangladesh Economic Zone Authority (BEZA) had issued the tender documents of developing lands in SEZ to the pre-qualified Indian contractors on August 27, 2023, sources said.

The Executive Committee of the National Economic Council (Ecnec) had approved $115.63 million for the project on April 9, 2019. Initially the duration to complete the project was from April 1, 2019 until June 30, 2023.

Meanwhile, the Bangladesh government has extended the tenure of the project up to June 30, 2025 as the present tenure of project expired on June 30, 2023.

As per the agreement, Beza will hand over the land to the Indian developer to start the development work at the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN). As per agreement, the Bangladesh government will give $630,000 while India will provide the remaining $115 million.

As of September 2023, only Tk 4.94 crore or 0.51 per cent of the project—taka 2.39 crore of GOB fund and taka 2.55 core (0.28 per cent) under the Indian credit line - according to sources of the Bangladesh Economic Zone Authority (Beza) until September 2023.

The cost of the project stood at 964.85 crore taka ($115.63 million) with Bangladesh government allocating taka 50.26 core with rest taka 914.59 crore by the Indian government  

Sources said that Indian authorities approved $115 million in funds for the project on June 11 under its third Line of Credit (LoC) worth $4.5 billion to Bangladesh, which was agreed upon in 2017.

As the national election of Bangladesh is set to be held in January, 2024, the process of constructing special economic zone goes slowly now amid the ongoing protests by the main opposition political parties

Meanwhile, Md Mokhlesur Rahman, Additional Secretary and project director for the establishment of Indian SEZ in Mirsarai, said that implementation of the project will gain momentum soon.

He said that progress in setting up an Indian special economic zone (SEZ) at Mirsarai in Chittagong will get momentum as both New Delhi and Dhaka are committed to implementing the $115.63 million project.

As per the agreement, Beza will hand over the land to the Indian developer to start the development work at the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN).

The ISEZ, to be set up on 1,000 acres of land, will cater to Indian investors.

According to the project paper, $55.52 million will be spent to develop land in the area.

In December in 2021, Exim Bank evaluated the prequalification application of three Indian contractors, but none was qualified for shortlisting. 

Meanwhile, Saroj Khuntia, general manager of Export-Import Bank of India, sent a letter to Md Shahriar Kader Siddiky, additional secretary of Economic Relations Division on May 5, 2022, informing that two Indian firms---Adani Ports and Special Economic Zone Limited and International Seaport Dredging Private Limited – have pre-qualified for land development) at Mirsarai under the India’s Line of Credit projects.

The revised pre-qualification of the construction contractors for land development for establishment of Indian Economic Zone (IEZ) in Mirsarai, based on the specification and criteria provided by the Bangladesh government was undertaken by the Exim Bank in line with the government of India LOC guideline dated back in December 7, 2015.

As per the provisions of the LOC guidelines, the Bangladesh government has been requested to forward a full set of tender documents, bid evaluation report and draft contract agreement to EXIM Bank.

The revised pre-qualification of the construction contractors for land development for establishment of Indian Economic Zone (IEZ) in Mirsarai, based on the specification and criteria provided by the Bangladesh government was undertaken by the Exim Bank in line with the government of India LOC guideline dated back in December 7, 2015.

Bangladesh's exports to the Indian markets are expected to reach $3 billion during this fiscal year as the demand for Bangladeshi products is increasing to the neighbouring country.

The proposed Indian Special Economic Zone is expected to bring Indian investment worth several billion dollars and help reduce the trade gap between two countries, said a director of FBCCI and an official of the Economic Relations Division.

The ERD official believes that successful implementation of the ISEZ will help reduce the trade imbalance between the two countries that are heavily tilted towards the neighbouring country.

The industries that will be set up in ISEZ would go into manufacturing products and export goods to the neighbouring countries, particularly to the Seven Sister States of India, he added.