Despite nine years of operation and cost of almost 500 million Tk, the construction of the central waste treatment plant in the Savar Tannery industrial area (STIE) has not been completed.
A Bangladeshi-Chinese consortium was commissioned to build CETP through a bidding process in 2012 and the completion deadline was 2017, but the deadline was extended several times.
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STIE finally took over the project from the consortium on June 27th.
Meanwhile, the delay in the joint venture has pushed the country’s multibillion-dollar leather sector into trouble, caused environmental pollution, damage to the nearby Dhaleshwari River and delayed the acquisition of Leather Working Group (LWG) certification. tanned skin.
The decision to terminate the contract with the company was made on the basis of recommendations from two technical committees set up in April to assess the progress and impact of CETP.
As of July 1, a start-up local company, Dhaka Tannery Industrial Estate Wastage Treatment Plant Company Ltd, took over CETP, said Jitendra Nath Paul, STIE project manager.
Although CETP has been operating for some time, the electronic monitoring system has not been installed in accordance with the agreement and its laboratory has inadequate testing facilities, Paul said.
In addition, only four of the eight types of test facilities were installed in the laboratory and a small laboratory was not built on the CETP site, he said.
Paul said the government could now take on another Balancing, Modernization, Rehabilitation and Expansion (BMRE) project to make it fully operational.
“We will reduce Tk 25 million from the total amount of Tk 492 million payable to the construction company as a penalty under the agreement,” Paul told the Daily Daily.
Paul also said that the current low capacity of the CETP tank – 25,000 cubic meters per day – is not able to withstand water overflow during the peak season in Eid-ul-Azha, when 50% of the annual raw area is produced of the country.
With few stocks of water, Paul advised tanneries not to use too much water in the tannery of the raw and not to use all the tanneries at once.
The global standard for using water to wash a ton of raw leather is 30,000 liters, but in the case of Bangladesh the tanners use more than 65,000 liters of groundwater.
Nurul Alam, CEO of DCL, the consortium’s local partner, said there had been a lack of co-operation from the beginning between the Chinese partner and the Bangladeshi side in the CETP project.
The Chinese company did not want to operate properly and there was a delay in land-related processes and other documents for the construction of CETP, he said.
“And in the end, it was not completed,” said Alam, who had less than a 50 percent stake in the consortium, while the Chinese partner had more than 50 percent.
Delwar Hossain, head of the CETP team and a lecturer at Bangladesh University of Engineering and Technology (BUET), said the partial construction of CETP would not help the Leather Working Group (LWG) certification for receiving international quotes from buyers.
Regarding the construction of a tank of 25,000 cubic meters per day, Hossain stated in the offer that the actual capacity was set at 20,000 cubic meters per day, but the capacity was increased later.
The production of raw leather in the country was not taken into account when the offer for the construction of such a small tank was requested, he said.
LWG gives certification after a country collects 1,365 points. Of the total grades, the tannery owners should get 900, the CETP 100 and the beginning 100.
The remaining points will be given to other factors. Currently, Bangladeshi exporters ship 40 percent less leather than internationally priced, as they cannot work with companies that comply without LWG certification.
In addition, the tanneries have also not improved their compliance, reduced the water used to treat raw leather and improved working conditions to obtain LWG certification, Hossain said.
Currently, most tanneries housed in STIE have to sell leather to non-compliant buyers in China and Europe, as they do not have LWG certification, which suggests better compliance and environmental protection practices.
Regarding CETP, Shaheen Ahmed, president of the Bangladesh Tanners Association, said that nothing had been done at CETP about heavy metals.
As CETP is incomplete, BMRE is required to obtain LWG certification, Shaheen Ahmed also said.
Saiful Islam, president of the Bangladesh-based Leathergoods and Footwear Manufacturers and Exporters Association, said profits from leather and leather goods exports were on the way to recovery as Western retailers and brands reopened.
In the last financial year, profits from leather and leather goods increased by 18.06% to $ 941.67 billion, according to data from the Export Promotion Bureau.