Tata group junks plan to invest in Bangladesh

KOLKATA: The TATA group has decided to put on hold for the time being, its mega-investment in Bangladesh, which included plans to set up a 2.4 m tonne steel plant. The group has cited the inordinate delay in processing its revised investment offer by the Bangladesh government as the main reason behind it.

The decision was taken after a meeting between Alan Rosling, executive director,Tata Sons and other top officials of the group and Mahmudhur Rahman, executive chairman of Bangladesh Board of Investment in Dhaka on Monday.

The Tata Group had submitted its revised offer after some nine months of detailed negotiations on a proposed 2.4-m tonne steel plant, captive and IPP power plants, an open cast coal mine, and a one million tonne urea plant.

“We strongly believe that the investments proposed by us would be beneficial to both Bangladesh and the Tata group.We are disappointed that progress has not been made since we submitted our revised offer. We now understand that the government is only likely to take matters forward after the general elections scheduled for January ’07,” Mr Rosling said in press statement issued on Monday.

“We are firm believers in the economic development of Bangladesh and will continue to monitor opportunities in the country closely. However, if indeed we are facing such a delay from the gvernment, we have no option but to suspend further work on these projects,” he added. Earlier in the day, Mr Rosling met Bangladesh government officials with a purpose to establish the government of Bangladesh’s position regarding the Tata Group’s revised investment proposals submitted on April 30.

Commenting on the future prospects of the projects, Mr Rosling said: “While we are keen to invest in these projects, their revival after a considerable delay must depend on circumstances at that point. We constantly examine opportunities worldwide and would need to assess the attractiveness of investment in Bangladesh compared to other options then available to us.”

The Tata group is already present in Bangladesh through many group companies including Tata Motors, Tata International, TCS and Tata Tea and Mr Rosling was confident “these businesses will continue to grow and develop.”