Coal imports have gone up remarkably in Bangladesh; a subtle indication of the material’s rising demand in the country, thus increasing business opportunities for overseas coal suppliers.
The growing power sector of Bangladesh has led to increased consumption of coal and has sent demand for the material soaring in the country. The Bangladesh government has been putting in efforts to develop the power infrastructure in the country by setting up new power plants, besides restoring old ones. Several new plants are being planned to raise the country’s power production to optimum levels, all indicative of substantial rise in coal demand in near future. With meager domestic coal production, Bangladesh is import dependent to cater to the nation’s demand of the raw material.
The 173% rise in import of coal In Bangladesh from 1.41 mnt in FY15 to 3.86 mnt in FY16 stands to show the rapidly growing demand for the material in the country. Although, Indonesia is the predominant source of coal import in Bangladesh, the country also imports from other regions of the world, including India.
Coal is commercially produced in Bangladesh only in a single mine viz Barapukuria Underground Coal Mine in the Dinajpur district. The production rate of the mine is around 1,500 tonnes per day. Efforts for establishing an open-pit mine in the adjoining region of Phulbari had to be aborted due to mass protest by the locals.
To alleviate the power supply deficit situation in the country, the Bangladesh government has targeted to increase electricity generation to 16,086 MW by 2021. To accomplish the target, the government is in the process of setting up 29 power plants with a combined capacity of 7,296 MW and process for setting up another 20 power plants with a cumulative capacity of 6,681 MW has already been initiated. Moreover, setting up of 8 more power plants with the total capacity of 4,435 MW is also being planned. In addition to setting up of new power plants in the country, the government has also taken steps for reviving the old plants, partnering with public as well as private undertakings.
Notably, the government has laid stress on usage of coal over other fuels in generation of electricity. To ease imports into the country, the government is also mulling over elimination of import duty on coal.
The rise in coal imports in Bangladesh has made the country a lucrative market for overseas coal suppliers. As it happens, India’s Coal India Limited (CIL) too is in the process of crafting a blueprint for exporting coal to its neighbor.
Source: Steel 360 Magazine September 2016 Issue