Govt signs MoU with Mitsubishi for car plant

Bangladesh expects to become a car manufacturing country by 2025 by joining hands with reputed Japanese car manufacturer Mitsubishi Motor Corporation.

To this end, Bangladesh Steel & Engineering Corporation (BSEC) and Mitsubishi will conduct a feasibility study towards setting up a car manufacturing factory in the country.

BSEC Chairman Md Shahidul Hoque Bhuia and Mitsubishi Motor Corporation’s South Asia Region General Manager Kurahashi Masatsugu signed a Memorandum of Understating (MoU) in this regard at the Ministry of Industries on Thursday.

According to ministry officials, the government expects to form a joint venture company and start production by 2023 as the feasibility study might take more than a year to complete.

Although the location for the manufacturing plant has not been fixed yet, BSEC wants to set up the factory at the Bangabandhu Sheikh Mujib Shilpa Nagar.

“We are now in the primary level. After completing feasibility study, we will finalize everything, including investment volume and partnership ratio,” Industries Secretary Zakia Sultana told The Business Post.

“It will be a milestone for Bangladesh and the country will be proud to become a car manufacturer,” she added.

The factory will be operated under a joint venture of BSEC and Mitsubishi, and both parties will get partnership.

Speaking at the MoU ceremony, Industries Minister Nurul Majid Mahmud Humayun said, “This MoU will pave a new way for the development of Bangladesh’s automobile sector. In order to facilitate this, the automobile development policy has already been approved in the cabinet.”

Currently, Progati Industry Limited (PIL), a state-owned company under the BSEC, has been assembling cars in collaboration with Mitsubishi. However, BSEC is not interested to merge Pragoti with the new car manufacturing company.

“It (Progati) will run by own way and we are trying to upgrade its capacity. Although, this company is facing manpower and technical crisis, we are working to solve these issues.

The new car manufacturing company will run under its own system and BSEC will be a partner of the company,” BSEC Chairman Md Shahidul Hoque Bhuia told The Business Post.

“We expect that we will find a big investment from the Mitsubishi and huge manpower will be employed here. Both parties will nominate their representatives for feasibility study,” he added.