Govt to start construction of Shahjalal Fertilizer Factory soon; 1750 MT daily production planned

By AKM Moinuddin

Dhaka, Sept 25 (UNB) - The government has made lot of progress in setting up the country’s first China-funded Urea fertilizer factory in Sylhet district amid growing demand of the major agricultural input, which is expected to cut dependence on fertilizer import to a large extent.
Bangladesh usually imports fertilizer from Qatar, Saudi Arabia, Abu Dhabi and China to address domestic demand.
State-owned Bangladesh Chemical Industries Corporation (BCIC) has seven fertilizer factories across the country, apart from the multinational Karnaphuli Fertilizer Company Ltd (KAFCO). However, some of the BCIC units remain inoperative due to gas crisis.
As on September 1, 2010, the government's stock of urea stood at 480,618 metric tons. The BCIC imported around 196,117 tons of urea last year while local production was around 87,014 tons, according to sources at the Industries Ministry.
Shahjalal Fertilizer Factory is one of three new fertilizer factories, which the government plans to set up with total annual production capacity of 577,500 metric tons. The other two factories are North West Fertilizer Factory Limited and Bhola Fertilizer Factory Limited.
North-West Fertilizer Factory will be set up in Sirajganj. The Chinese government has also expressed its eagerness to finance the setting up the factory.
The under-construction Shahjalal Fertilizer Factory, with daily production capacity of 1750 metric tons of urea, is likely to go into operation by 2013, officials said.
The Tk 5319 crore project will be implemented by utilizing the infrastructure of the country's first Natural Gas Fertilizer Factory (NGFF) at Fenchugnaj, which remained inoperative for long.
“We’ll soon start the construction process of the factory after the signing of commercial contract with China…we hope it will go into production within the tenure of the present government,” Industries Minister Dilip Barua said.
He said the Chinese government has already agreed to provide soft loan for the project with 2 percent interest, which is the lowest rate offered by China to Bangladesh.
“You won’t get loan below 10 percent interest. China is our friend…they offered the soft loan as a good gesture,” Barua said.
Bangladesh signed a Framework Agreement with China for the construction of Shahjalal Fertilizer Factory during the Prime Minister’s visit to China in March this year. Industries Minister Dilip Barua signed the framework agreement on behalf of Bangladesh government.
Industry Ministry sources said the government of China is providing US$382 million as soft loan while US$325 million as preferential buyer’s credit.
END/UNB/