Meghna Economic Zone: Development and facilities for investors

Mostofa Kamal Chairman & MD Meghna Group of Industries

Mostofa Kamal
Chairman & MD
Meghna Group of Industries

The Meghna Group of Industries (MGI) is one of the highest ranked corporate and a leading industrial conglomerates of Bangladesh. Since its inception 40 years ago, MGI has embedded its footprints in the manufacturing sectors of Fast Moving Consumer Goods (FMCG), Cement, Commodities, Pulp & Paper, Chemicals etc. They are also prominent in the sectors of Power Plant, Ship Building, Shipping, Securities, Media, Aviation, Bank & Securities, Fish and Poultry Feed. In Bangladesh they are recognised by popular brands of Fresh, No. 1, Pure etc.

The Group of Industries had an asset value of US$ 1 billion and turnover of US$ 2 billion in 2015 from its large portfolio of 32 companies. They employ over 21,000 employees and 3,000 distributors all over the country. Their presence is recognized by the fact that every one of two households in Bangladesh is a consumer of products from Meghna Group of Industries. They also have large logistic support with oceangoing vessels, Oil Tankers, Lighters, Covered Van/Trucks, Crane, Bulk Carriers, Helicopters, etc.

Since the inception of Economic Zone concept in Bangladesh 10 years ago, Meghna Group of Industries has been one of the pioneer to implement it to reality in the most promising country of South Asia. Presently they are the only one to have been awarded with Final License for Meghna Economic Zone Limited (MEZL) by Bangladesh Economic Zones Authority (BEZA). Also, they received Provisional Pre- Qualification License for Meghna Industrial Economic Zone Limited (MIEZL), while the works are undergoing for Pre- Qualification License for MIEZL and Comilla Economic Zone Limited (CEZL). Meanwhile, 9 other Economic Zones from 8 other groups have also been awarded with Pre- Qualification License by the BEZA. All are working with the common goals- advancing industrialization in the most planned and organized way, creating job opportunities and bringing foreign investments in Bangladesh.

Meghna Economic Zone Limited

Meghna Economic Zone (MEZ) is situated on the banks of the mighty Meghna River in the Sonargaon Upazila of Narayanganj district. It is presently located upon approximately 67.92 acres of land,which is targeted to expand up to 245 acres of industrial land. The zone is already fully developed for industrial construction and operation and is secured by boundary walls. The zone is already equipped with all necessary utility facilities of electricity from own Captive Power Plant, natural gas from TITAS, and underground water. Upon complying with all the rules and regulations of BEZA, MEZ has been awarded with the first Private Economic Zone license of Bangladesh on August 23rd, 2016.

MEZ is located at a suitable location for industrial setup conveniently beside the Meghna River, with the Dhaka- Chittagong highway just 1 km away, Hazrat Shahjalal International Airport 37 km away.

 

The zone is currently capacitated with 5 of its own power plants with total capacity of 140MW. Besides this, there will be facilities of Effluent Treatment plant, Water treatment plant, Sewerage treatment plant, Waste Water Treatment plant, etc. The zone also has rainwater harvesting area, central fire station, security barrack, mosques etc. Further, MGI is opting to construct a fully functional Inland Container Terminal Port at the zone vicinity to ease up the loading/ unloading of goods from vessels upon the river routes, and also developing a new road for transport of goods by trucks to the highway. The zone is to operate industries of Pulp & Paper, Tissue paper, Edible Oil, PVC resin, Flour & Lentil Mills, Sugar refinery, Food Processing, Mineral Water, Seed Crushing,  etc.

Upon full operation of the zone, it will employ over 20,000 employees including male- female and skilled- unskilled workers. Presently the zone is planned to contain only the industries of Meghna Group of Industries, and also in cooperation with Chong Qing Min Metal Industries of China.

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Meghna Industrial Economic Zone Limited (MIEZL)

MGI is also developing Meghna Industrial Economic Zone (MIEZ), their 2nd venture of Private Economic Zone with land areas of approximately 96.98 acres. The said zone is located in Chhoto Shilmandi Mouza of Narayanganj district. Located in the most prestigious industrial area of Narayanganj and adjacent to Dhaka- Chittagong Highway, the zone has taken measures to make available supply of power, gas and water holding the maximum benefits that an EZ can provide to the prospective industries.

MIEZ is targeted for potential investors including foreign as well as local ones. In this directive, it is under intense planning to not only be the most investor friendly, but also to be an exemplary zone in the country. Its location is one of the most lucrative factors for the investors- being adjacent to the Dhaka- Chittagong highway, 37 km from Hazrat Shahjalal Int’l Airport, 220 km from Chittagong Sea Port, 25 km from Kamalapur Rail Station, and around 5 km from nearest river port.

Upon complying with regulations and requirements of BEZA, MIEZ has been awarded with Provisional Pre- Qualification license as on May 11th, 2015 for 21 acres of land, and now they are working to obtain Pre-qualification license for approximately 73 acres of land.

The zone is planned considering international standards of economic zones. There will be 137 industrial plots, each of 0.5 acres or 2000 m2 in size. A continuous supply of electricity will be ensured by the own power supply of MGI and REB upon requirement, while gas will be provided by TITAS and water will be extracted from underground source. The roads will be of 60ft – 80ft width, and provisions for Central Effluent Treatment Plant, Sewerage Treatment Plant, Rain Water Harvesting, Fire Services will be present. Furthers pace for commercial banks, restaurants, investor’s club, mosques, etc. will be allotted for the benefits of the investors.

MIEZ is receiving great response from investors of global renowned international brands from Japan, Thailand, China, Singapore, India, etc with their interests to invest and build up suitable infrastructure for industries of RMG, Beverage, Pulp and Paper, Oil Refinery, Power Plant, PVC, Packaging Film Industry, Petrochemicals, pharmaceuticals, Automobiles, Electronics, IT service, etc. employing above 10,000 workers. Among products/ finished goods, 30%- 40% are expected to be exported while 60%- 70% will be for local market. The entire project will be carried out in two phases-first phase in developing the land, construction of boundary walls and road network; while in the second phase utilities, drainage and sewerage disposal, and allocation of land to investors will occur.

The entire project is projected to be in full operation from the year 2020, while the first phase will end in 2016 and the second phase to start from 2017.

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Comilla Economic Zone Limited (CEZL)

Albeit in a preliminary stage of land acquisition and development, the largest Economic Zone of Meghna Group of Industries is underway with targeted land area of 272 acres. Comilla Economic Zone is located in Looter Chor in the Comilla district, to the south side of Meghnariver. Presently Pre-qualification license for the zone is under process in BEZA. Once the zone is developed, it is forecasted to behold the maximum benefits a PEZ can offer to its investors. It is also designed keeping all modern amenities in mind, including those of CETP, clean environments, ICT facilities and others.

Why invest in Economic Zones

To distinguish investments in Economic Zones from regular investments in Bangladesh, Bangladesh Economic Zones Authority has devised various incentives for the private investors. First and foremost comes the tax incentives, followed by others as listed below. Among the fiscal incentives lie the following:

  1. Tax Holiday: 1st, 2nd & 3rd year: 100%, 4th: 80%, 5th: 70%, 6th: 60%, 8th: 40%, 9th: 30%, 10th: 20%
  2. Duty free import of Raw Materials, construction materials, capital machineries, Finished Goods; EZ is Custom Bonded
  3. Exemption on Dividend tax and Capital Gain Tax
  4. Full Repatriation of Capital and Profit
  5. 80% Exemption of VAT on Utility Services, 100% Exemption on export duty
  6. Exemption of Customs Duty on Import of two (02) vehicles
  7. Relief from Double Taxation
  8. 50% Income tax exempted on salary of IT related expatriates (5 years), 100% on royalty and technical fees
  9. Share Transfer Allowed
  10. Re-investment of remittable dividend considered as new FDI
  11. Various Others

 

1.Chairman & Managing Director of Meghna Group of Industries Mostofa Kamal is receiving License from BEZA Executive Chairman Paban Chowdhury.

1. Chairman & Managing Director of Meghna Group of Industries Mostofa Kamal is receiving License from BEZA Executive Chairman Paban Chowdhury.

Among the non-fiscal incentives lie the following-

  1. No Ceiling on FDI
  2. 100% Backward linkage industries RM to sale to EOI in DTA allowed
  3. 20% Sale of Finished Products to DTA
  4. Sub- Contracting with DTA allowed
  5. FC Account for non-resident; FC Loan availability
  6. Resident Visa and Citizenship upon amount of Investment
  7. Various Others

The details of the incentives can be found on the official website of BEZA at www.beza.gov.bd. With the help of these incentives BEZA holds the long term view of economic development of Bangladesh through industrialization and investments. They project that within 15 years there will be setup of 100 economic zones all over the country including government, private as well as foreign zones- all contributing to employment generation of 10 million people, and export of US$ 40 million per annum by then. Presently from the progress of Economic Zones in Bangladesh, it apparently seems the target is not far-fetched.