Private economic zone developers have sought a Tk10,000 crore government-backed low-cost fund to develop land and essential infrastructure and make industrial zones ready for investment.
The Private Economic Zones Association of Bangladesh (Pezab) has proposed launching the fund initially with Tk5,000 crore, with plans to gradually raise it to Tk10,000 crore.
The association has proposed loans at 4.5% interest for 15 years, including a four-year grace period. Developers would contribute 30% of project costs as equity, while the remaining 70% would come from the proposed fund.
Pezab made the proposal in a letter to Finance Minister Amir Khosru Mahmud Chowdhury on 24 August, citing difficulties in developing private economic zones due to high-interest and short-term commercial loans.
Under the proposal, commercial banks would receive refinancing at 1% interest and provide loans to zone developers at 4.5%.
The fund would finance land development, roads, drainage, water and sewerage systems, treatment plants, electricity and gas networks, renewable energy, fire safety, waste management, logistics, ICT and other essential infrastructure.
Bangladesh currently has around 23 approved private economic zones, of which eight have received final certificates and are in commercial production.
Pezab said the fund should prioritise projects where substantial private investment has already been made, investors or industrial units have been secured, and additional infrastructure could quickly generate production, exports and employment.
Pezab President ASM Mainuddin Monem said high-interest, short-term borrowing is increasing development costs and delaying investment in the zones. He argued that concessional financing is essential because private developers face large upfront costs while revenue begins only after factories start operations.
