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Last Updated: Thursday, 14 October, 2004, 10:30 GMT 11:30 UK
Tata to invest $2bn in Bangladesh
Worker checks gas pipes in Bangladesh
Bangladesh wants firms to see opportunities not problems
Indian industrial group Tata has agreed to invest $2bn (1.1bn) in Bangladesh, the biggest single investment by a firm in the south Asian country.

Tata plans to build a power plant, steel mill and fertilizer factory.

Finance minister Saifur Rahman said that Tata's move should help attract other foreign firms to Bangladesh.

Tata chairman Ratan Tata said that "we are here to invest in Bangladesh where we see opportunities for doing business".

The agreement, or letter of interest, was due to be signed on 20 September, but was delayed by outbreaks of violence following a grenade attack at a political rally in Dhaka.

Tata said last month that it still had to finalise details such as gas prices and locations for the projects.

Bangladesh, which has its own gas reserves, has agreed in principle to guarantee a 20-year supply of natural gas.

We see opportunities for doing business
Ratan Tata, chairman of Tata

The company said that - if all details are finalised - construction could begin this year.

Alluring?

Finance minister Mr Rahman said "a very congenial investment climate exists" in Bangladesh.

Bangladesh has however found it hard to attract money and total foreign direct investment (FDI) in Bangladesh since 1972 has totalled $3bn.

The World Economic Forum (WEF) said in a report on Wednesday that Bangladesh was one of the most uncompetitive places to do business.

Only Angola and Chad scored worse in its annual Growth Competitiveness Index, with Bangladesh slipping four places to 102nd in 2004.

The rankings are drawn from a WEF poll of 8,700 business leaders worldwide and the report aims to reflect issues such as macroeconomic stability, the quality of public institutions and the level of technological development.

The Tata group is made up of 80 businesses that span industries including hotels, truck-making, software, consumer products, chemicals, and communications.


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