Bangladesh is still in the early stages of developing its renewable energy sector, but it can learn valuable lessons from China’s success. To attract Chinese foreign investment, Bangladesh must create a business-friendly environment. The Center for Policy Dialogue (CPD) has advised the government to establish a fund to protect against foreign currency risks and encourage investment in this sector. China is currently a global leader in renewable energy.
At a dialogue titled “Foreign Investment in the Renewable Energy Sector: How to Attract Chinese Investment in Bangladesh?” held yesterday at a hotel in Gulshan, the CPD provided several recommendations. The session was chaired by Dr. Fahmida Khatun, Executive Director of CPD, and attended by prominent figures, including the Chairman of the Revenue Board, Md. Abdur Rahman Khan. Dr. Khondaker Golam Moazzem, Research Director of CPD, presented the keynote paper.
Speakers at the event highlighted that Bangladesh is undergoing an energy transition under the interim government. Significant investment is required in the renewable energy sector, and Chinese investment could be a major source of financing. CPD advised the government to establish a fund to provide partial guarantees and safety nets for investors. They also recommended subsidies for currency swaps and urged local banks to offer loans in local currency to foreign institutions.
Dr. Khondaker Golam Moazzem provided several suggestions to attract Chinese investment in the energy sector, including offering tax incentives and subsidies to investors. He also called for government financial support to promote public-private partnerships and emphasized the need for investment in skill development to mitigate foreign currency risks.
The CPD noted that the interim government has decided to adopt an open and competitive tendering process for new electricity projects, which could create several opportunities for Chinese investors and financiers. The ten newly launched grid-connected solar power plants by the Bangladesh Power Development Board (BPDB) were cited as potential testing grounds for private sector investment.
Additionally, the discussion touched on the possibility of the government inviting bids for new power plant projects through a “reverse auction” process. China, with its portfolio of 37 renewable energy-based power plant projects, could submit proposals for these auctions.
