Business Today

The cost of construction of horse manure factory is increasing

The cost of the project is being increased by about 50 percent after the completion of the project period. When the project was passed, the cost was estimated at Rs 10,460 crore. The four-year project expired last June. Now the expenditure is being increased by 48 percent to 15,500 crores. Background of the story—Ghorasal Palash Urea Fertilizer Factory Project.

An amendment proposal to increase the expenditure by 5 thousand 40 crore rupees for seven reasons is being presented to the Executive Committee of the National Economic Council (ECNEC) today on Tuesday.

An initiative was taken in 2018 to set up another fertilizer factory in place of the existing Urea Fertilizer Factory Limited and Palash Urea Fertilizer Factory Limited in Palash Upazila of Narsingdi. A project of Tk 10,460 crore has been taken for the construction of a granular urea fertilizer factory with a production capacity of 2,800 tons per day.

Then the duration of this project is from October 2018 to June 2022. The project is financed by Japan Bank for International Cooperation, Bank of Tokyo Mitsubishi UFJ Limited and HSBC. Bangladesh Chemical Industries Corporation (BCIC) is implementing the project.

According to BCIC sources, almost two-thirds of the project has been implemented till last June. Now it is proposed to revise the project by adding new accessories.

The seven reasons for which the project cost has been proposed to be extended by almost 50 percent and the duration by two years are delays in loan agreements and commercial agreements; 2 thousand 303 crores of Bidders Financing included in project cost; Customs duties, construction of railways, laying of electric lines, construction of residential buildings, purchase of gas for chemical products and experimental production; Adding income tax to the contractor as a new part of the project, various government license fees, purchase of electrical equipment, audit fees and various programs; updating various economic codes; Delay in import of factory machinery due to increase in quantity of various products and covid pandemic.

In this regard, a senior official of the Industrial and Energy Branch of the Planning Commission told Prothom Alo, to meet the demand of urea fertilizer to ensure the country’s food security; The project should be completed to ensure supply of fertilizers to farmers at affordable prices as well as to reduce import dependency. Therefore, the revised proposal regarding the increase in the duration and cost of the project has been sent to Ekne.

Already two fertilizer factories in Ghorashal have been merged. Ghorashal Palash merged Urea Fertilizer Factory Limited (UFFL) and Palash Urea Fertilizer Factory Limited (PUFFL) on 1 July 2021.