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Even a 20 per cent cash incentive for agro-processing companies, offered eight months ago, has failed to attract any investment in three Export Processing Zones -- Ishwardi, Uttara-Nilphamari and Mongla.
Let alone the communication problem, the lack of utility services such as gas and water supplies has been working as disincentive to the investors in those south and northern specialised industrial zones of the country.
"Location problem is hindering the investment growth in these EPZs, and some other problems such as problem of gas and water at Mongla and gas at Nilphamari are also working as hindrances," said an official of Bangladesh Export Processing Zones Authority (BEPZA).
He also said convenient locations of Dhaka and Chittagong EPZs has attracted more than expected investment. But the far-flung EPZs have been neglected by investors despite the offer of cash incentive, he said.
"Even the local investors are not coming up with a $1.0 million investment at Mongla, Uttara and Ishwardi. How can we expect the foreigners to come up for investment in those areas?" he asked.
The government established Comilla EPZ on 267.46 acres of land and developed 208 industrial plots in the first phase, Ishwardi EPZ on 308.97 acres of land with 166 industrial plots in the first phase, and Uttara EPZ on 264.99 acres having 221 industrial plots in the first phase.
When Comilla and Ishwardi EPZs are 170 kilometres and 550 kilometres away respectively from the country's main port city, the country's eighth EPZ at Mongla with port facility faces gas and water problem.
"The EPZ at Mongla is seriously suffering from gas problem and shortage of sufficient sweet water. Saline water around Mongla EPZ area cannot be used for production purpose," said the official.
So far, Mongla EPZ has generated employment opportunities for 391 persons, but it was expected that 897 people would be employed when all of its plots would be allotted. The BEPZA has failed to sanction any plot there since November 27, 2004.
In Uttara EPZ, Nilphamari, there has been no sanction of plots since 2001 although the government has been offering lucrative facilities, in addition to existing ones.
The government has offered facilities such as 10-year tax holiday, duty-free import and export, relief from double taxation, exemption from dividend tax, duty-free import of three vehicles, expatriates being exempted from income tax for three years, accelerated depreciation on machinery or plant and finally 20 per cent cash incentive.
The offers also include investment protection under Foreign Private Investment and Protection Act, 100 per cent foreign ownership with no ceiling on investment, full repatriation of capital and dividend, foreign currency loan from abroad under direct automatic route.
These facilities combined with good location have been fruitful in case of Dhaka and Chittagong EPZ areas, but it has not been successful in attracting more investment in Uttara, Mongla and Ishwardi EPZs.
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