Govt plans zero duty on solar

Highlights

The government is set to introduce a duty-free import facility for solar-powered water desalination plants in a bid to provide affordable and safe drinking water to coastal communities, according to officials from the finance ministry.

This initiative is aimed at addressing the water needs of thousands of coastal residents who lack access to grid electricity, particularly those residing in salinity-prone communities in the southern region of the country.

Finance Minister AHM Mustafa Kamal is expected to make an announcement of this plan on 1 June during his budget speech for fiscal 2023-24.

Industry insiders have said there is a potential for the installation of solar-powered water desalination systems in Bangladesh.

They believe that providing a duty-free facility for the import of solar power plant equipment will not only facilitate the renewable energy transition but also reduce the country's reliance on fossil fuels.

Finance ministry officials have revealed that a foreign company specialising in solar-powered desalination systems is already working on a project to install approximately 1,500 units of such plants in the southern part of Bangladesh. Through this project, around 50,000 coastal communities will gain access to safe drinking water.

The officials expressed hope that the introduction of this new facility would encourage more stakeholders to invest in this sector.

When asked for his thoughts on the matter, Mustafa Kashem Khan, the founder and managing director of FloWater Solutions Ltd, a local water and wastewater solutions provider, praised the initiative but emphasized the sector's vast potential.

He mentioned that FloWater has completed 150 water and wastewater projects throughout Bangladesh, with desalination plants comprising only a small segment of their portfolio.

"We have developed five desalination plants for our partner Friendship in Satkhira and a water ATM for Swisscontact Bangladesh," said Kashem.

He also highlighted that his company serves as the local partner for renowned entities such as Marubeni Corporation, Veolia Water Technologies, and Climate Fund Managers.

According to the Sustainable and Renewable Energy Development Authority (SREDA), Bangladesh currently possesses approximately 1171.27MW of renewable energy generation facilities, including about 937.28MW of solar capacity.

Solar desalination project