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There are more than 70 lakh power customers across the country with the peak demand for power exceeding 5,200 megawatt (MW) against a maximum supply of 3,300 MW last year.

The PDB’s earning rate from power sales is decreasing incrementally. On an average, the PDB now purchases power at Tk 2.53 per kilowatt hour (per unit) and sells it at Tk 2.15. In 05-06, the PDB earned Tk 2.27 per unit by selling power and Tk 2.41 in the previous fiscal year. It sells 80 percent of its power to the Desa, Desco, REB, and the Western Zone or Westzone at a rate much lower than its average price. For instance, the REB buys power at Tk 1.94 a unit and sells it around Tk 3 to rural customers. In addition, in the last fiscal, the PDB handed over huge distribution lines to REB. Some of these included PDB’s profitable zones. The Desa, which is the biggest consumer, and is mainly responsible for the loss making spectacle where power thieves take away nearly one fourth of the sales, pays the PDB Tk 1.88 per unit. The Desa however pays another Tk 0.23 per unit to the PGCB as transmission fee. The PDB sells the remaining 20 percent of the total power to its own customers at a much better rate. But this share is too little to improve the PDB’s financial condition. Only a few years back, the PDB’s average power purchase cost Tk 2.15 per unit while the sale price was around Tk 2.4. Back then, systems loss had been the major cause of the PDB’s loss.

DEALING WITH THE IPPS In addition to incurring losses, the PDB is contract-bound to make payments to independent power plants (IPPs) or for private power in foreign currency. Often the PDB is seen running into severe liquidity crisis in making these payments. The cost of IPP power had been largely very friendly for the PDB but the lack of PDB’s power sales price adjustments in the recent years is now taking its toll. The PDB paid a total of Tk 1,707 crore in 2004-05 and Tk 1,934 crore in 2005-06 to IPPs. The IPPS in 2005-06 supplied over 36 percent of the total electricity distributed across the country. The country produced 2,2741 gigawatt hour power during this time in which the IPPs supplied 8,286 gWh. Of all the IPPs, the Meghnaghat and the Haripur AES plants — 450MW and 360 MW — have kept the sinking PDB afloat for a few years. While the PDB swallows heavy losses from all private and public power plants due to inconsistent government policies, power from both Meghnaghat and Haripur plants remain the least costly. The average cost of Meghanaght power was Tk 1.46 a unit in 2004-05 and Tk 1.59 in 05-06, Haripur Tk 1. 25 in 2004-05 and Tk 1.33 in 05-06. The price remains low because of the original deals, and size and location of the plants although the deals demand payment in dollars. In contrast, other IPPs which were conceived and pushed by the Awami League government have remained unkind to the PDB. Two Mymensingh 70 MW simple cycle gas-fired units under the Rural Power Company (RPCL) charged Tk 3.51 a unit in 2005-06. The RPCL is owned by the government’s Rural Electrification Board (REB) and several palli bidyut samities, and is not a typical privately owned company. The NEPC 90 MW gas fired barge-mount plant charged Tk 3.63 a unit in 2005-06, Westmont 90 MW gas-fired barge-mount plant charged Tk 3.68 a unit during the same period and Khulna 110 MW oil-fired plant Tk 8.49 a unit. “Of them, Khulna unit is costly because it uses imported oil. Oil price has gone up from $90 a tonne to $300 in two years. The NEPC and Westmont deals demand payment in dollars, and the high dollar rate has contributed to this price hike,” one source pointed out. “Besides, small power deals always put up comparatively high prices.”

"At least 2 million to 2.5 million new local jobs will be needed until the global economy recovers fully, compared with 1 million to 1.1 million local job creation needed prior to the global economic crisis," the WB said in a report "Bangladesh: State of the Economy and Policy Response to the Global Economic Crisis" launched yesterday.

Due to the global meltdown, the jute sector job loss is projected to reach 50,000 by the end of fiscal 2009, the report said. Twelve spinning mills out of 341 have been shut in the textiles sector.

"The labour force is increasing by two million people a year. If manpower exports revert to the pre-boom era in the Middle East (up to 300,000 a year), the domestic economy will have to create jobs for another 500,000 people a year," the WB said.

Sheikh Hasina said the strategically important locations of Bangladesh's two important seaports-Chittaong and Mongla- is crucial for development of the countries in this region. "We can construct a deep-sea port side by side with modernising the existing two to create opportunities for the neighbouring countries like Nepal, Bhutan, India and China, she said adding these seaports would play a significant role in the country's economy".

Sheikh Hasina put emphasis on information technology (IT) and said her government had given priority to this sector while in power in the past and encouraged setting up of radio, television channels in the private sector apart from breaking monopoly in mobile phone business which created the scopes for massive employment.

Describing huge prospects of developing waterways in the country, she said initiatives would be taken to modernise the railway and waterways side by side with the road linkages.

The Indian delegation, headed by ICC president Sanjay Budhia, while meeting Bangladesh Prime Minister Sheikh Hasina in Dhaka on Monday, expressed willingness to set up an SEZ there. For this, it has sought a suitable 150 acre plot in that country, wherein it may attract Indian investments worth $5 billion, suggested the chamber.

Direct investment from India could help Bangladesh reduce its trade deficit with India. Massive investments from Indian corporates, including prominent ICC members will create surplus capacity which would not only improve availability of manufactured goods and diversify its basket of goods for re-export to India, said ICC.

During its discussion with the Bangladesh authorities, the Indian delegation has pointed out that sectors like energy, power (both hydel and thermal), steel, communication, healthcare, fertiliser, oil & gas, limestone and forest-based industries like paper, export of plantation crops, spices, fruits, vegetables, flower, herbs and processed foods are some of the areas which can drive a stronger bilateral economic relations between the two countries.