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The investment promotion authority found the recent gas tariff hike as ‘discriminatory’ for new investors and apprehended that it would put an adverse impact on its ongoing efforts to attract new investment.
The hike just after the investment summit would ‘undoubtedly’ create a negative perception among the aspiring investors, said Bangladesh Investment Development Authority (BIDA) executive chairman in a letter to BERC.
The latest upward revision, on April 13, 2025, of gas prices by 33 per cent would put a higher tariff burden on the new investors compared to that of the existing one.
However, BIDA said it supported the government’s effort to cut subsidy but it should not be discriminatory.
“The government can consider trimming the subsidy uniformly,” BIDA Executive Chairman Chowdhury Ashiq Mohammad Bin Harun wrote in a letter sent to the Chairman of the Bangladesh Energy Regulatory Commission (BERC) on Tuesday.
In the letter, obtained by the FE, Mr Chowdhury found the necessity to review the gas tariff hike decision for the sake of new investment and keep economic mobility unhindered.
Talking to the FE, Energy Adviser Md Fouzul Kabir Khan said investors were queuing up with their investment proposals despite the gas tariff hike.
“Many investors are willing to make investment despite this gas price. So far, we have more than 300 investment proposals who have agreed to invest at this price,” he told the FE.
It’s BERC’s discretion to review it, but the government is not in a position to subsidise for an unlimited period, he said.
In the letter, the BIDA chair said the discriminatory policy on gas tariff would affect new investment and discourage country’s competitiveness.
“Investors have already taken stance against the decision,” he wrote.
BIDA thinks that this decision would hinder the Foreign Direct Investment (FDI) flow to Bangladesh, he added.
To attract investment, the Bangladesh Investment Summit-2025 was held from April 7 to 10 in the city.
A total of 450 investors from 40 countries participated in the summit.
“A number of investors have signed Memorandum of Understanding (MoU) and agreements with the BIDA showing their interest to invest in Bangladesh,” Mr Chowdhury wrote.
In the letter, Mr Chowdhury sought sincere cooperation of BERC to set an investment friendly gas tariff rate.
He suggested a review and impact analysis workshop to discuss the issue.
Talking to the FE on Wednesday, BERC chairman Jalal Ahmed said they were yet to officially receive the letter.
“We are open to discuss the issue in the commission and also with the Petrobangla that has put forward the proposal of gas tariff hike, if it creates any controversies,” he said.
The BERC chairman said the commission delayed the decision of gas tariff hike considering the investment summit.
Nahian Rahman Rochi, Head of Business Development of BIDA, said the BIDA chair put forward the proposal to review as differential tariff structure will dissuade new investors from entering the market.
“We are happy to organise a consultation to further discuss and pros and cons about it,” he said.
However, Mr Rochi urged the BERC to do review it within the fastest possible time.
“….and we need to ensure that the ultimate decision on rate is investment friendly,” he said.
Preferring anonymity, representative of one large foreign investor said the energy advisor have played smart, with this new concept, everyone is against rather discriminatory price between old and new, next move he will do is equalize old industry in to new industry to Tk 40 per cubic meter from today’s rate of Tk 30 cm.