Solar Stimulus Strategy: Govt Eyes Tax Breaks, Low Tariffs to Boost Investment

Iqbal Hasan Mahmud has said the government is considering nominal import duties on solar equipment and a five-year tax holiday to accelerate investment in the solar power sector. He also announced that an investment-friendly policy for the sector will be unveiled by June.

The remarks came on Thursday, 14 May, at a consultation workshop organized by Bangladesh Economic Zones Authority (BEZA). The workshop focused on a 130MW solar power and Battery Energy Storage System (BESS) PPP project at the Mirsarai National Special Economic Zone in Chattogram.

The minister said the government is working to reduce duties and taxes on key components such as solar frames, photocells, and batteries. According to him, minimal import duties combined with time-bound tax incentives would encourage entrepreneurs to invest, ultimately increasing future revenue.

He added that allowing private investors to utilize rooftop spaces in areas like Dhanmondi and Mohammadpur could generate nearly 1,000MW of solar power from these two areas alone.

Citing Pakistan as an example, Iqbal Hasan Mahmud noted that government support in importing solar equipment has proven successful there. He suggested Bangladesh could adopt a similar approach—either by facilitating imports directly or allowing private sector imports at zero duty.

At the event, State Minister for Power and Energy Anindya Islam emphasized the importance of private investment, technology, and operational efficiency in the renewable energy sector. He stressed the need for supportive policies and simplified approval processes.

BEZA Executive Chairman Ashik Chowdhury said the project will be implemented with support from BEZA, the Power Division, UNDP, and Asian Development Bank. He noted that the initiative is significant for enabling the use of government land, introducing BESS technology for the first time, and creating a model for private investment on underutilized land.

DBTech/PA/EK/OR