Monopolistic contract with Reliance of India is damaging

AS PER a national daily, Indian conglomerate Reliance has set a time-bound action plan for the government to expedite signing of unsolicited contracts with it for import of liquefied natural gas and installation of, and electricity supply from, a 750MW power plant in Bangladesh. When local industries suffer most for the sheer shortage of uninterrupted power and gas supply, welcoming the Indian giant will constrain the growth of local industries. In this age of globalization, a state can never open its border completely though economic theory argues for a borderless economy, but every state puts some embargoes. Already local industries and agriculture have been suffering most due to aggression of Indian commodities. The invasion of Indian Reliance which engulfs even Indian small enterprises will establish a market monopoly in Bangladesh.

In a letter on July 16, Reliance requested Bangladesh government to ensure the completion of five specific tasks by July 31. The tasks included issuing letter of intent to Reliance by the Bangladesh Power Development Board, initialing land lease agreement by the Board, issuing gas allocation letter to Titas Gas Transmission and Distribution Company by Petrobangla and finalizing the gas supply agreement with Titas for the construction and operation of the power plant. The tasks also included finalising discussions with Reliance and initialing agreements for the installation and the use for the LNG terminal which would supply 500 million cubic feet of natural gas a day by gasifying imported LNG.

Our government allowed Reliance to implement the projects under the Speedy Supply of Power and Energy (Special Provisions) Act 2010. In a move to award the contracts to the companies without tenders, the Power Board signed two memorandums with the companies on June 6, 2015, the day Indian premier Narendra Modi arrived in Dhaka on a two-day state visit. Reliance will set up facilities at Kutubdia Island to import LNG and supply 500 mmcfd gas a day and set up and operate a 750MW gas-fired combined cycle power plant at Meghnaghat in Narayanganj. The Power Plant will consume 110 mmcfd gas. Interestingly, on May 24, the Cabinet Committee on national purchase approved a proposal for Power Purchase Agreement under which Reliance would sell electricity from the plant to the Power Board at 7.3123 US cents (Tk 5.80) per unit or kilowatt-hour for 22 years.

The unsolicited agreement that the government awarded the Indian conglomerate is unprecedented and damaging for the country. The government must disclose the articles of agreement signed with Reliance to the public and the Parliament should arrange discussion on this issue.

Such one-sided contract, not favourable for Bangladesh, is not helpful for friendly relationship with India. It is reported that Reliance has other connections including with our newspaper world. Activities of Reliance should be open and fair.