The newly established Shahjalal Fertiliser Factory incurred a loss of Tk 239 crore in the first fiscal year of its operation, despite achieving the production target.
The factory authorities, however, were hopeful of overcoming the loss within a few years by increasing its production capacity.
SFF, the biggest fertiliser factory in the country with an annual production capacity of 5.8 lakh tonnes, was set up at a cost of Tk 5,409 crore at Fenchuganj upazila in Sylhet and began commercial production around 2016.
Earlier, prime minister Sheikh Hasina had inaugurated construction work of the industrial unit on a 62 acre land on June 24, 2012.
The Chinese government and the EXIM Bank of China loaned 70 per cent of the estimated cost to establish the factory while the remaining fund was provided by the state exchequer of Bangladesh, official sources said.
The factory managed to produce its target of 3.93 lakh tonnes of urea, which the authorities had fixed for 2016-17 fiscal year.
At Tk 14,000 per tonne, the industrial unit managed to earn around Tk 550.2 crore during the budgetary year. However, it spent Tk 789.2 crore to run the factory, leading to the loss, said official sources.
They pointed out that factory expenditure had increased following hike in fares of transport used to carry fertiliser to different parts of the country and also due to the salaries paid to a large number of Chinese specialists.
The major heads of expenditures in the last fiscal year were Tk 120 crore paid for the installment of foreign loan with interest, Tk 98 crore for pre-operating cost, Tk 103 for consumed natural gas, Tk 60 crore for transport charge, Tk 52 crore and Tk 50 crore for salaries to 48 Chinese specialists and the local officials and employees respectively, factory officials said.
SFF managing director Monirul Islam said counting Tk 239 crore in losses in a single fiscal year could be unusual for any industrial unit. But it is not so big for a large company like SFF.
Pointing out that the factory paid private transporters double the charges of rail transport, Monirul said the production cost would decrease after adjustment in some heads including the transport type.
‘The expenditure would decrease further after increasing production capacity, which is already underway,’ he added.
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