Dhaka, Bangladesh (BBN)– Karnaphuli Fertilizer Company Limited (KAFCO) on Thursday proposed to set up its second unit spending US$ 1.0 billion with a production capacity of 1.2 million metric tones of urea a year.
KAFCO officials put forward the proposal at a meeting with Industries Minister Dilip Barua at his Shilpa Bhaban office in Dhaka.
The new unit will be set up under public private partnership (PPP) with financial support from Japan and Denmark. Once implemented, the unit is expected to produce 3,500 metric tones of urea a day on average.
During the meeting, both parties decided to sign a memorandum of understanding (MoU) soon after the approval to set up the KAFCO second unit.
The KAFCO officials said Bangladesh would be benefited economically if the KAFCO second unit is set up. They also said it would help cut fertilizer import and strengthen food security in the country.
Earlier in November last year, the Danish Ambassador at a meeting with the minister expressed the interest to invest $ 1.0 billion in Bangladesh for establishing a new fertilizer factory and handed over a proposal in this connection.
Bangladesh is now dependent on import of fertilizer as the gas crisis has forced some state-run fertilizer factories to remain inoperative, the industries ministry officials said.
To reduce the import dependency, the government is setting up Shahjalal Fertilizer Factory with the production capacity 1,760 tones of urea a day which is expected to be completed by mid-2015.
Currently, the country has six urea fertilizer factories with an annual production capacity of 1.8 million tones, the ministry officials added.
BBN/SSR/AD-04May12-2:05 am (BST)
