High price keeps demand for Bscic plots low

Entrepreneurs are shying away from applying for 913 plots in 14 industrial cities in different districts of the country set up by Bangladesh Small and Cottage Industries Corporation (Bscic)  due to high land prices.

Among these, 843 plots are in five new and two expanded industrial cities and 70 are in the old ones.

In the new industrial cities, for example in Munshiganj, the price of per acre land is Tk8 crore. However, in the old ones the price is relatively lower and ranges from Tk43 lakh to Tk3 crore per acre.

Entrepreneurs say the excessive land price is putting additional pressure on them. If the government does not provide any subsidy, it is not possible to set up industries in these plots.

Bscic officials say that the price of plots has increased as they have to buy lands at three times higher price as per the government provision for land acquisition.

Nasreen Rahim, deputy general manager (industrial city and coordination branch) of Bscic, told The Business Standard, "The price of the plot is high because the land has been acquired as per the price fixed by the government. However, the price has been reduced once. Now there is no chance for further cuts. If no entrepreneur applies, a notification would be issued again."

Abdur Razzaque, president of Bangladesh Engineering Shilpa Malik Samity, said, "Entrepreneurs do not want to take the plots now because of the high price. Although the industrial city has been built at our request."

He said, "Bscic has bought the land following the acquisition policy, but the price of the plot is much higher than the market price. It is difficult to set up an industry here without government subsidy."

The new industrial cities have been built in Barguna, Gopalganj, Madaripur, Chuadanga, Moulvibazar, Munshiganj and Jhalokathi at a cost of Tk562 crore.

The old BSCIC industrial cities for which application has been sought for plot allotment are in Cumilla, Sunamganj, Lalmonirhat, Khagrachhari, Meherpur, Patuakhali and Bhola.

No application against 95% plots in Munshiganj

The construction works for BSCIC industrial city in Tongibari, Munshiganj started in 50 acres of land in 2016. Although it was scheduled to be completed in 2019, the deadline was later extended till 2022.

25-acre land of the industrial city has been earmarked for the electrical products manufacturing industry and the rest 25 acres for the engineering industry.

The target of the industrial city is to create employment for about 1,650 people.

The cost of the project increased from Tk280.57 crore to Tk315.80 crore due to time expansion.

Bscic called for applications for plot allotment here with a time limit of 45 days on 24 August this year.

It said the prices have to be paid at a time or in 10 installments in 5 years. It asked the applicant to pay 20% of the total price of the land to be paid through pay-order.

So far, only 14-15 applications have been received against 362 plots.

The land price in this industrial city was fixed at Tk12 lakh per decimal of land in the first notification but later it was reduced to Tk8 lakh per decimal. However, entrepreneurs still have not shown much interest in plot allotment in the industrial park.

Mohammad Abdullah, officer-in-charge of Bscic Munshiganj, said, "Although we have called for applications, the response from the entrepreneurs is very low. However, we have not decided yet what our next step would be."

Other industrial cities of Bscic in different districts outside Dhaka have also failed to attract entrepreneurs in plot booking due to high land price, inadequate road communication, insecurity and lack of access to ancillary services, according to people concerned.

Makdum Elahi Masravi Shams, deputy manager of Bscic, Moulovibazar, said, "In Srimangal, applications have been received for only one of the 121 vacant plots. However, there is no plan to reduce the plot price."

Gaurab Das, assistant general manager of BSCIC, Gopalganj, said, "Only 4 out of 137 vacant plots have been applied for. Entrepreneurs are not applying for plots due to high prices."

BSCIC has set up 76 industrial cities across the country for the development of small and medium enterprises since its inception in 1956.