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Aggregate business

EU seeks govt support to remove obstacles to LHBL operations

| Updated: February 12, 2023 08:47:34


EU seeks govt support to remove obstacles to LHBL operations

Amid resistance by local interest groups, the European Union (EU) has sought intervention by the government of Bangladesh so that LafargeHolcim Bangladesh Limited (LHBL), a multinational company listed in Bangladesh, can continue its aggregate limestone business in the open market without any obstacles.

In a recent letter to the industries ministry, the authorities concerned have been requested to remove the bottlenecks the company has been facing for some time now and allow the business.

The business is being resisted allegedly by the Chhatak Limestone Importers and Suppliers Group, which is also spreading "false propaganda" against it.

The EU Ambassador and head of Delegation to Bangladesh Charles Whiteley, Spanish Ambassador in Dhaka Francisco de Asís Benítez Salas and Charge d Affaires of Switzerland in Dhaka Suzanne Muller in the letter requested the government to deal with the issue under the applicable laws of the country.

"It is our sincere wish that the investment of LHBL shall continue to strengthen the close cooperation between the government of Bangladesh and foreign investors in full conformity with the applicable laws of the country," according to the letter.

The LHBL is one of the leading foreign direct investors in Bangladesh. Since 2001, the company has invested over U$ 500 million to set up an integrated dry process clinker manufacturing plant in Chhatak, Sunamganj, based on a friendship agreement between Bangladesh and India.

More recently and as part of the continued FDI plan in the country, the cement company invested in a state-of-the-art modern aggregate plant and commenced its operation in January 2021.

For many years, the respective missions have worked closely with the company and the authorities to promote and secure this important investment, the letter reads.

Domestic manufacturing plants are aiming to produce customised aggregate at international quality standards to support the ongoing development construction sector in Bangladesh, it adds.

The letter mentioned that the Ministry of Industries has been playing an important role of mediation throughout several meetings which took place recently based on concerns raised by the Chhatak Limestone Importers and Suppliers Group.

The government also emphasised the importance of mutual coexistence between LHBL and the community and asked LHBL to give additional consideration to the question how it can address the concerns raised by the Association and improve the livelihood of the local community.

To this end, LHBL has submitted a letter to the ministry on January 24 and formalised a generous proposal to implement its corporate social responsibility (CSR) that is expected to benefit the socio economic livelihood of the communities in Chhatak.

According to the EU, the aggregate business of LHBL has been scrutinised by various government authorities including industries and commerce ministries, Bangladesh Investment Development Authority (BIDA), National Board of Revenue (NBR) and the Supreme Court of Bangladesh.

According to the letter, Bangladesh Competition Commission (BCC) has also started another investigation on the same issue.

When contacted, senior manager, communications at the LHBL Thuhidul Islam said the LHBL conducts its business in compliance with the applicable laws, and operates its aggregate business with necessary approvals from the relevant regulatory authorities, including the industries ministry.

He said the Chhatak Limestone Importers and Suppliers Group has been opposing the business since the very beginning and spreading false propaganda. Hearing a writ petition, the High Court in an order on January 05 last year gave a verdict in favour of the LHBL.

Chhatak Babsayi-Shramik Oikya Parishad, including Limestone Importers and Suppliers Group, had claimed that selling aggregate in the open market by the LHBL is illegal.

After conducting multiple investigations, the industries ministry on March 27 last year also gave us a temporary permission to continue the business, added Mr Islam.

Chhatak Limestone Importers and Suppliers Group president alleged that the LHBL authorities have been selling crushed limestone in open market violating rules as the limestone were imported from India.

He claimed that the local small importers, traders and workers of stone quarries were facing difficulties due to selling the limestone in the open market by the LHBL.

He added that importers, traders and workers earlier observed a strike in Chhatak, Sunamganj protesting the sales of imported limestone in the open market by the LHBL, violating the existing rules.

Bangladesh's annual demand for aggregate is 70 million tonnes, including clear-sized aggregate of 30 million tonnes. The country produced less than 1.0 million tonnes of clear-sized aggregate in 2022, which was very insignificant compared to the national demand, according to the LHBL data.

The aggregate is an import-substitute local manufacturing product that saves the country's foreign currency, constitutes more than 100 per cent value addition and pays highest tax to the government exchequer, it added.

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