Likely to be Bangladesh’s biggest industrial hub, Mirsarai Economic Zone in the country’s south-eastern district of Chittagong is open to investment and is calling out to investors to reap the most out of what it promises to be excitingly fruitful for business.
Conceptualised to be built on 30,000 acres of land with an aim to lure multi-sector investment, Bangladesh Economic Zone Authority (BEZA) has already acquired 16,000 acres and is working tirelessly to transform the area into the industrial capital of Bangladesh while promising high-quality business-friendly environment.
The potential investment sector in the Economic Zone are apparel and apparel supporting industries, integrated textiles, agro and agro-processing products, leather and leather products, shipbuilding, motorcycle assembly, food and beverage, paint and chemical, liquefied petroleum gas, paper and products, plastics, light engineering, pharmaceutical products, and solar park.
The Mirsarai Economic Zone is expected to be ready to host investors and developers alike by this year (partially). So, with expectations that high, is Mirsarai really worth it? Well, Apparel Resources have found out six reasons why Mirsarai can be considered as more than a good bargain for investors, especially foreign.
1. Connectivity and accessibility
Mirsarai Economic Zone is said to be one of the most suitable sites of Bangladesh for setting up industrial establishments with an inherent advantage of strategic location on the Dhaka-Chittagong industrial corridor. It is located just 67 kilometres away from Chittagong port – Bangladesh’s principal port that handles over 80 per cent of the export-import business. Also, that far is Shah Amanat International Airport.
BEZA says it is currently drawing up a comprehensive ‘master plan’ to develop the self-containing Mirsarai Inudstrial City including rail connectivity, marine drive, residential area, tourism park, power plant, hospital, school, hotels and university.
The zone is connected to the Dhaka-Chittagong highway via a 10-kilometre four-lane access road which is being implemented. Infrastructural development worth Tk. 2,600 crore, including a 50-km-long four-lane road inside the zone, nine gates, a 40-km stretch of Dhaka-Chittagong highway and an 18-km-long mountain road, has been conducted.
2. Quality utility services promised
Authorities have promised top-notch utility services for Mirsarai. For electricity, a 150MW power plant project has been taken up which is expected to be completed by 2018. BR Powergen is building the duel fuel power plant and will be upgrading the plant to 500MW capacity by 2021. The main objective of the power plant will be to ensure reliable and quality electricity to developers and unit investors.
On that note, Power Grid Company of Bangladesh is constructing a new 230/33 kV GIS grid substation at Mirsarai at a cost of BDT 436 crore. Initially, it will be connected to 230 kV GIS grid substation at BSRM. The substation is expected to commission in 2019. In future, this substation is expected to be upgraded to 400 kV voltage level.
Meanwhile, Karnaphuli Gas Distribution Company Limited is constructing a gas pipeline for Mirsarai – a pipeline for LNG gas connection project – at a cost of BDT 289 crore. It will upgrade the existing gas distribution capacity from 350 MMSCFD to 500 MMSCFD and supply bulk and industrial customers. Primarily it will make arrangements for supplying 200 MMSCFD gas to the upcoming industrial customers of Mirsarai.
3. Jaw-dropping incentive packs
According to BEZA, investors will be allowed tax holiday for upto 10 years – first two years being 100 per cent. Also, authorities will allow duty-free import of raw materials, construction materials, capital machineries, and finished goods. Mirsarai will be allowing full repatriation of capital and dividend, and put no ceiling on the amount of investment.
Investors will be offered 80 per cent VAT exemption on consumption of utility services, 50 per cent exemption of stamp duty and registration fees and exemption of double taxation (subjected to double taxation agreement).
For investors, dividend tax will be exempted after the end of tax holidays, sub-contracting within the domestic tariff area will be allowed, tax will be exempted from capital gains, share transfers will be allowed, resident, and citizenship visas will be offered on conditions.
4. Hassle-free land in industrial hub
Several businesses have already started to throng Mirsarai. Apparel businessmen’s body Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has already inked an agreement to take up 500 acres of land on a lease basis. Besides, Ananta Group, one of the leading apparel makers and exporters, is setting up 6 new factories in Mirsarai for producing fabrics and yarn – taking up 250 acres of land for 50 years.
Also, to consider, Mirsarai will be in close proximity to another Economic Zone in an adjacent district – Feni, which is also expected to be another mega project of Bangladesh in the line of creating 100 Economic Zones. BEZA assures, land leasing will be hassle free.
Sources inside the BEZA tell Apparel Resources that it wants to extend all-out support to the apparel manufacturing sector of Bangladesh which is expected to grow in the coming days. They think that Bangladesh will have an advantage in the production of apparel products for about 20 more years.
5. Security guaranteed
Being a coastal area, prone to cyclones and flash flood, Bangladesh Water Development Board is constructing a flood control, road cum embankment protection and drainage project at the cost of BDT 1,16,277 lakh. The project that will be providing coastal embankment (super dyke) with slope protection of over 18 kilometres – protecting the project area from flood, saline intrusion, erosion, and natural disaster – is expected to be completed soon.
It will safeguard the Economic Zone and its infrastructure and communication network for uninterrupted economic activities.
6. Service that’ll leave you amazed
BEZA has opened a One Stop Service (OSS) centre for the investors and stakeholders for the purpose of hassle-free business in the Economic Zone. The OSS will help business with permits of import-export, sub-contracting, utility, local purchase or sale, NOC for off-shore banking, customs clearance, TIN-VAT, environment clearance, fire safety clearance and a ton of other services.
To avail the service, an online registration process is required in the website of Bangladesh Economic Zones Authority. It would require some documents and information. From then on, BEZA promises, services will be delivered to everyone very swiftly.