Bangladesh has told India's Tata Group that it does not have gas to spare for the steel and fertiliser plants that form part of its $3 billion investment proposals. Instead, Tata should await the coal policy that is on the anvil.
Allen Roseling, executive director of Tata Sons, responded by saying Sunday: "If there is no gas, we cannot go ahead with our steel plant."
The situation would be the same for the fertiliser project that was to be fuelled by the gas, analysts noted, viewing the five-hour talks as a dampener on the biggest foreign investment proposals that Bangladesh has ever received.
The talks, which resumed after two years, produced "no answer", New Age newspaper said Monday.
The Indian conglomerate will review and study the resources situation in Bangladesh before making the final decision on investment, said Roseling.
The government side informed the Tata officials about the the country's depleting energy resources and said it was not possible now to supply 200 million cubic feet of gas daily as asked by the Indian conglomerate for its planned plants.
"We told them about the resource situation, gas scenario and coal policy (in the making), which would form the basis for our discussion," said Board of Investment (BOI) chief Kemal Odin Ahmed, who led the Bangladesh side at the talks.
Roseling, too, admitted that the country's gas reserve situation was not in a state that "the investor wanted it to be in", the report said.
The Tata group will now look at the planned coal policy that will determine the mining method - either underground or open-pit - and see whether enough coal would be made available for its proposed power plant.
Neither BoI chief nor the Tata executive confirmed when the next stage of negotiations would take place.
The Tata proposals worth $1.8 billion were first made in 2003 when its chief Ratan Tata visited Bangladesh.
They were hiked to $3 billion later with more projects envisaged as part of a larger effort to utilise Bangladesh's resources to speed up industrial development.
Indo-Asian News Service