Dhaka:Bangladesh's decision to implement a 1 percent import duty on solar equipment is expected to attract Australian investment in the renewable energy sector, according to Murray Spence, Trade and Investment Commissioner of the Australian Trade and Investment Commission (Austrade), during an exclusive interview with BSS.
According to Bangladesh Sangbad Sangstha, Spence emphasized the importance of policy stability, predictable regulations, and commercially viable project arrangements to translate this opportunity into long-term investments. He noted that lower equipment costs could decrease the initial investment required for solar power systems, potentially enhancing project viability.
Spence, who concluded his four-day official visit to Bangladesh, highlighted that the measure could be particularly beneficial for export-oriented industries aiming to reduce electricity costs and bolster energy security. He also outlined opportunities for Australian companies to collaborate with Bangladeshi partners in solar power generation, battery energy storage, energy efficiency, technology transfer, and related industrial services.
An eight-company Australian clean energy delegation has been exploring opportunities to connect Australian technology providers with Bangladeshi businesses and project developers. Spence pointed out that investors require clarity on whether favorable tariff arrangements will persist throughout their investment and procurement cycles to commit to long-term projects confidently.
He further stated that while lower import duties might reduce initial project costs, clear regulations governing project approvals, foreign ownership, taxation, and repatriation of profits are essential for attracting sustained foreign investment. Transparent and streamlined procedures for foreign direct investment, joint ventures, and technology licensing could improve the overall business environment.
Moreover, transparent and predictable power purchase agreements (PPAs) are crucial in attracting investment in renewable energy. Consistent rules for grid connections and the sale of surplus electricity would encourage investment in rooftop solar systems. Battery energy storage could complement solar installations by storing electricity during periods of high generation and supplying it when demand rises.
The Australian delegation's engagement with Bangladesh indicates opportunities for joint ventures, technology licensing, local manufacturing partnerships, and technical service arrangements with Bangladeshi businesses. These partnerships could facilitate skills development, technology transfer, and the expansion of domestic manufacturing capabilities.
For Bangladesh, maintaining predictable tariff arrangements and simplifying investment procedures could mobilize foreign capital and lower the cost of deploying renewable energy. For Australia, it could expand clean energy exports, transfer technology, and build long-term commercial partnerships. Ensuring the tariff incentive is supported by consistent regulations and credible commercial arrangements will be vital for converting bilateral clean energy engagement into financially viable projects and sustained investment.