Sunday | 6 October 2024 | Reg No- 06
বাংলা
   
Sunday | 6 October 2024 | Epaper

Investing in power sector, foreign investors transform the lives of millions of people in Bangladesh

Published : Monday, 11 September, 2023 at 12:00 AM  Count : 1089
Mr. Nafees Sharafat, founder of Canadian University and Chairman of Padma Bank, presented this paper at South East Asia Client Forum, hosted by DEG.

We join to celebrate mutual cooperation and friendship that will result in plenty and prosperity not for a selected group of individuals, but for people from all over the world coming from all social and economic strata. By facilitating cross-country exchange, knowledge sharing, nations around the world will foster future growth by exploiting new global trends and opportunities. After all, that is the vision and purpose of DEG, to help developing and emerging economies by cooperating with private sector players that will lead toward a better and sustainable future for the underprivileged and underserved. For 6 decades, it has worked with this motto and helped to transform the lives of millions of people all over the world.

I come from Bangladesh, a case of paradox in terms of economic development. Once cited as a 'basket case' of development, it is now on its way to become the next Asian Tiger. Often cited as a model case for development in the global economic circle, its remarkable achievement has raised widespread inquisitiveness among global experts to figure out the secrets behind. Bangladesh had maintained 7 percent GDP growth from 2016, and achieved 8.2 percent GDP growth rate by 2019 before COVID pandemic hit. During COVID, while most of the countries around the world has suffered recession and declining economic growth, Bangladesh maintained an impressive positive 3.5% growth rate during 2020 and once again reached the 7% growth rate mark by 2022. The resilience and consistency of economic progress has far-reaching impact to alleviate the lives of the millions of people of Bangladesh. According to UNDP, our poverty incidence declined from 50.4% in 1990 to 20.5% in 2019.

This rising economic prowess has gained praise from global experts. Former UN Secretary General Ban Ki-Moon praised Bangladesh as 'Role Model' for developing nations. Bangladesh has taken spot in the next eleven list in Goldman Sachs in 2012. J.P. Morgan Sachs gave Bangladesh spot in its 'Frontier Five' list. PWC declared in 2017 that by 2030, Bangladesh will be 28th economy of the world.

Alongside the rapid growth, Bangladesh has shown remarkable financial prudence. We have maintained a Debt/GDP ratio of 32.55%, which is far below the IMF recommended 55%. We have never defaulted in any foreign loan repayment terms and always maintained prudent financial practice over the years.

One of the major pushes for this momentous growth came from power sector, one of the most crucial sectors of our economy.

The massive economic growth has been fueled by energy sector as it has provided the required energy consumption demand. Energy growth has outpaced GDP growth rate by 1.5% over the last decade. It is not only one of the main drivers of growth, but also a sector with remarkable investment opportunity.  
According to 2016 Power Sector Master plan or PSMP, planned energy generation is going to be 60000 MW to fulfill the growing energy demand by 2041. Per-capita electricity consumption will reach to 1475 KWh from 2019's 510 KWh by this time. This massive growth in electricity generation demand will also lead to dynamic changes in the current structure of energy production. We are planning to shift toward more diverse fuel sources which will emphasis on renewables for ensuring energy security and less Green House Gas emission. This is paramount importance for Bangladesh and will also help the country to achieve SDG goal 7, 8, 9 and 14 of affordable and clean energy, decent work and economic growth, industry, innovation and infrastructure, and climate action.

According to PSMP, by 2041, we are planning to reduce gas-based production to 35%, which currently stood 60.44%. We want to produce at least 15% from renewable energy, which currently stood around only 2%. To achieve this energy growth powered by diverse fuel source, foreign investor and lenders must come forward. Their expertise and funding can transform power sector scenario rapidly and accelerate economic growth of our country. For investors, Bangladesh provides a lucrative investment opportunity in power sector. Government of Bangladesh has made energy a priority sector and providing tremendous incentives for investors.

The government has provided such incentives to both public and private institutions and foreign investors that opens up door for huge profitable investment opportunities. Legislations such as Policy guidelines for Enhancement of Private Participation in the power sector, 2008 has been drawn to promote such investment activities.  

Our education sector has produced ample qualified graduates to fulfill the workforce demand for the burgeoning power sector. Institutions such as banks and others are also extremely supportive for power sector investors and regulators are supporting easy facilitation of regulatory support. For institutions like DEG, it is a golden opportunity to invest in the power sector in Bangladesh.

By investing in power sector, foreign investors are getting opportunity not only to invest in a highly profitable industry, but also to transform the lives of millions of people. At the same time, investors can restructure current industry landscape by investing in alternative energy sources such as solar, wind and other renewables. Collaborative approach is paramount for any success in such endeavor. Historical precedence strongly supports this.

When Germany introduced feed-in-tariff system, that not only fueled renewable electricity production in its own country, but also helped the growth of solar panel production, an activity concentrated in China. Today Bangladesh may require energy generation, but foreign investors also need profitable and inclusive investment opportunity that power sector can provide. It will fuel growth, increase global trade, and improve international relations among participants. Together we can build a more inclusive, prosperous, and resilient future for all.

For this purpose, I welcome foreign investment to continue its support for energy sector in Bangladesh. This is a win-win situation for Bangladeshi producers, DEG or any other foreign investors as together we can lead a change for more democratic, inclusive, and prosperous future.


LATEST NEWS
MOST READ
Also read
Are we prepped to face climate change?
Big push for Bangladesh to adapt to changing climate  
The unraveling of military rule in Myanmar
How to win an argument
Recognise Pakistans 1971 atrocities as genocide
Its time we diversified our export trade
Stop ecocide to gain green economy
Conservation of our wildlife is a must
Editor : Iqbal Sobhan Chowdhury
Published by the Editor on behalf of the Observer Ltd. from Globe Printers, 24/A, New Eskaton Road, Ramna, Dhaka.
Editorial, News and Commercial Offices : Aziz Bhaban (2nd floor), 93, Motijheel C/A, Dhaka-1000.
Phone: PABX- 41053001-06; Online: 41053014; Advertisement: 41053012.
E-mail: info©dailyobserverbd.com, news©dailyobserverbd.com, advertisement©dailyobserverbd.com, For Online Edition: mailobserverbd©gmail.com
🔝