A business plan is needed from Tata, if any - instead of the dakati plan that it placed in the past
The fact that Tata even thought that the current (initial) project proposal can be made, surely with tacit lobbying from the than BoI chairman, it outrageously indicate the hollowness of business sense and the lack of negotiating skills (btw, which also includes responsibility, if not patriotism) of our bureacracy.
If one look at the research on FDI around the world, everybody will tell you that there are some competitive advantage of the recipient nations that attracts foreign investors to the country. On the basic level, there are two criteria that greatly influences the investors while deciding on a country.
The first and foremost criteria is what the recipient country has to offer to others who are considering to come into the nation with FDI. It includes the infrastructure, policy support, tax structure, tax incentive and other socio-political indicators which helps creates a business friendly environment.
The second important criteria is how comfortable is the FDI agent with the recipient country. This second criteria is defined by the factors like how close the two countries are in cultural, regional and historical level.
If you look at this two criteria, they are distinct.
According to first criteria, all the FDI interested parties will have the same level of interest on a specific destination (e.g. Bangladesh), since this criteria does not depend on the source country, rather it is dependend on the recipient country. As long as, the government do not discriminate among the foreign nationals. Hence, all the interested parties will be similarly attracted to Bangladesh, at least, theoretically that seems to be plausible.
According to the second criteria, however, the FDI interested parties will not have same level of interest on a specific destination (e.g. Bangladesh), since this criteria depend on the source country and its relationship, proximity and history of the recipient country. In this case, the past and ground realities sets an environment that natuarly creates an discriminating effect among the foreign nationals. Hence, all the interested parties will not be similarly attracted to Bangladesh, at least, theoretically that seems to be plausible.
Are you with us so far?
With that background, let us now take two example source country of FDI for Bangladesh. Our chosen countries are Japan and India, let us assume.
According to our first criteira, both the countries should be similarly interested about investing in Bangladesh.
According to our second criteria, India should be more comfortable in investing in Bangladesh than Korea. At least, theoretically that seems to be plausible.
So, if Bangladesh Government wants to create a level playing field among the interested FDI parties, government should be giving more incentive to the Korean companies than Indian companies. If not, at least, government should not give any favourable special treatment to the Indian companies, since attractiveness according to the first criteria should be the same for all companies irrespective of their source country. According to the second criteria, if there is any special treatment to be given, that is not the Indian but other companies who are distant from us. If government want to do otherwise, that may drive away the other FDI sources who might be seen as discriminated against.
If one looks seriously at the Tata's initial investment proposal and thinks about it with the context we have described, one can only conclude that the proposal was not a business plan, may be something else. If you ask Dr. Wahiduddin Mahmud, he would agreee. Why did they think they can get away with it? In other words, why didn't they think it would bring bad name for them? Because, we had some imcompetent people in our policy making who can not talk, negotiate or something worse. Factually, it would probably a combination of all. Corruption and inefficiency are the two most important trait that has been driving the investment and privatazation scene in BD so far. We hope ACC will have some time for this.
You are not yet convinced with this argument? Please ask the government or TATA to publish their proposal for public scrutiny. If that copy can be reached to a proper analyst in the Wall Street Journal or New York Times, they will be ashamed to read it! Irresponsible!
One side comment, the other day we noticed that the Chief Adviser's office is looking for a slogan or branding message for Bangladesh. We have an idea. How about this: "Bangladesh - neighbor of a (irresponsible?) giant "? Off course, we do not think the bracketed words can be kept there.We recongize that its not a good slogan for long term. But when we are trying to break out of the negative image worldwide, starting with this slogan for few years might not be a bad idea. What do you think? It should also be noted, it might not be a good idea to assume India as a monolithic entity, which it is not. But, given that the rightist wing within this giant democracy has been so far the controlling force within the policy making circle as far as Bangladesh is concerned, it should be taken as a message by the world community about how to strenghten the moderate voices within that system.
On a more realistic note, we think, Tata should come up with a realistic business plan and drop their current unrealistic plan. That can go a long way to build an integrated economic system in our region. They, along with other candidates with big item investemnt plans, they all should start with smaller projects as a confidence measure. In a few years time, they should find out that we, in Bangladesh, offer a very congenial and competitve environment for businesses, so there should not be any need to ask for special treatment like supply of energy at a below market rate (which is an absurd expectation, btw).
If you thought some of the ideas are worth of your reading time, please forward it to others. If you have an ear to the columinsts in regular traditional media, please forward it to them. If you have an ear to the journalists and news editors of the electronic media, discuss it with them. Hope they would look at the suggestions and give due diligence.
Also, if you thought the article was important enough so it should come under attention of the head of the government or the head of anti-corruption commission, please forward the message to them.
Thanks for your time,
Innovation Line
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Note: This is a freelance column, published mainly in different internet based forums. This column is open for contribution by the members of new generation, sometimes referred to as Gen 71. If you identify yourself as someone from that age-group and want to contribute to this column, please feel free to contact. Thanks to the group moderator for publishing the article.
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