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Losses of state-owned enterprises step-up
Jul '08
Increasing price subsidy for petroleum products has increased the net loss of the state-owned enterprises (SoEs) by 132 percent in 2007-08 fiscal.

A draft economic review was made by the finance ministry which revealed that some 44 SoEs incurred net loss of Tk5,276 crore in the period, up from Tk2,275 crore of the previous year.

Of this 44, around 15 SoEs were in losses while the others either made a marginal profit or broke even. In fiscal 2007-08 the total SoE sector losses, arising out of the losses incurred by the 15 SoEs, stood at Tk8,635 crore, up from Tk 4,774 crore in 2006-07 fiscal.

Bangladesh Petroleum Corporation (BPC) alone incurred a loss of Tk5,882 crore which is a substantial increase from Tk2,628 crore registered in 2006-07 fiscal. The finance ministry calculated losses of BPC incurred till May 15.

Reasons attributed are inefficiency on part of BPC to reduce the gap between the prices of petroleum in the international market and those prevalent in the domestic one.

Although Government had plans to increase the prices of petroleum in the budget last year, BPC could not do so, since the prices of essential commodities were already high and natural disasters had also taken a toll on the market.

The Power Development Board (PDB) in 2007-08 also incurred loss which stood at Tk1361 crore, a 50 percent increase from Tk904 of the precedent year. Bangladesh Chemical Corporation also depicted a downward trend incurring losses amounting to Tk365 crore, up from Tk309 crore over the corresponding year.

The situation was a little different for Bangladesh Jute Mills Corporation (BJMC), whose losses declined to Tk108 crore in 2007-08 compared to Tk320 crore of the previous year.

Although profits from the SoEs also increased, it was very marginal when compared to the heavy losses recorded from various industries. SoE sector profit in 2007-08 fiscal totaled Tk 3,359, which was Tk 2499 crore in the previous fiscal.

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