‘Fuel security now a make-or-break factor for Bangladesh’s industrial growth’

Bangladesh’s industrial sector is facing a mounting crisis rooted in fuel insecurity, threatening production, investment and long-term economic stability, warned Dhaka Chamber of Commerce and Industry (DCCI) President Taskin Ahmed on Saturday.

Speaking at a discussion titled “Energy Efficiency Policy in the Industrial Sector of Bangladesh: Guidelines for Sustainable Development” held at the DCCI auditorium, Taskin Ahmed said uninterrupted fuel supply has become one of the biggest challenges for industry – a sector that contributes over 35 per cent to the country’s GDP.

Industrial output hit hard by fuel shortage and price rises

According to the DCCI chief, the industrial sector consumes 19 per cent of the country's total gas supply, yet it is now in an “existential crisis”. Following a record 178 per cent rise in gas prices in FY2023–24 and a further 33 per cent increase this year, several major industries – including textiles, steel and fertiliser – have reported production declines of 30-50 per cent. SMEs, in particular, have been forced to cut operations drastically.

“In this situation, ensuring uninterrupted energy supply is not only a policy priority, it is a prerequisite for sustainable industrialisation,” Taskin said. He stressed reducing reliance on fossil fuels, accelerating renewable energy adoption, preventing waste and building a diversified energy structure to safeguard the economy.

BERC: Energy efficiency still only 30% 

Bangladesh Energy Regulatory Commission (BERC) Chairman Jalal Ahmed said domestic gas reserves are projected to diminish after 2030, yet exploration in onshore and offshore blocks remains stagnant. As a result, “we cannot utilise enough local gas and must rely increasingly on imports”.

Jalal noted that the current energy efficiency level is only around 30 per cent. Improving efficiency, he said, would significantly ease power shortages. He also urged Bangladesh’s ready-made garment factories to prioritise renewable energy to reduce pressure on the national grid.

Masterplan exists, but policy support missing

SANEM Executive Director and Dhaka University Economics Professor Dr Selim Raihan, presenting the keynote speech, said that despite having an energy-sector masterplan, the absence of supportive implementation policies is “seriously hurting” the industrial sector.

He highlighted:

Lack of a clear definition of energy efficiency

Uneven distribution of incentives across industrial sectors

Weak implementation of energy audits

Gaps in financing, grid modernisation and communication

Findings from a DCCI-SANEM focus group discussion with RMG, cement, steel and commercial-sector leaders were also presented, recommending improvements in energy audits, logistics, and supply of gas and electricity.

Industry and energy leaders call for immediate action

During the panel discussion, several senior industry and energy-sector figures issued strong warnings and recommendations:

Energy must rank just after national and food security: BEPRC

BEPRC member Dr Md Rafiqul Islam said energy security is now the country’s third most critical security concern. He noted that Bangladesh spent nearly USD 20 billion importing energy in the last financial year and called for greater involvement of domestic private investors in the sector.

Tariff structure must be updated: Power Grid Bangladesh

Power Grid Bangladesh PLC Chairman Dr M Rezwan Khan said the existing tariff structure is outdated. Peak and off-peak electricity rates should be differentiated, he argued, adding that fuel shortages – not transmission capability – are the primary reason behind inconsistent power supply.

Production disrupted by 50% in some industries: Anwar Group

Anwar Group Chairman Monowar Hossain said fuel shortages routinely disrupt up to 50 per cent of industrial production. He urged urgent reforms to ensure electricity reaches factories reliably.

LPG could help, but taxes discourage use: BCMA

Bangladesh Cement Manufacturers Association President Mohammad Amirul Haque said LPG could play a significant role in industrial energy security, but a 10 per cent tax discourages adoption. He called for immediate fiscal reforms.

Energy demand growing 20% annually: BSREA

BSREA President Mustafa Al Mahmud said demand is rising rapidly but policy implementation remains weak. He emphasised mandatory energy audits, noting that 50 per cent of the country’s electricity is consumed by industries.

700-800 MW renewable potential from LPG stations: LPG Association

LPG Autogas Association President Eng. Md Sirajul Mawla said around 2,300 LPG stations could generate 700-800 MW of renewable power if proper policies are introduced. He also urged the government to simplify multi-agency licensing procedures.

Renewable energy share only 4%: BGMEA

BGMEA Vice President Bidya Amrit Khan said global buyers now prioritise renewable energy compliance, yet Bangladesh’s renewable share in the national grid remains only 4 per cent. She noted that although there is a green fund for building construction, financing for renewable energy is scarce.

Green bonds needed: IDCOL

IDCOL Deputy CEO SM Monirul Islam said poor policy implementation is widening energy-sector gaps. He called for the introduction of green bonds to attract sustainable financing.

Broad participation from industry and government

Former DCCI Senior Vice President Malik Talha Ismail Bari, former Director M Bashirullah Bhuiyan and Member MS Siddiqui also spoke during the open discussion. DCCI Vice President Md Salim Solaiman, board members, and representatives from various government and private organisations were present.