Bangladesh and Pakistan have agreed on a technical and financial framework to rehabilitate and modernise Bangladesh's crisis-ridden state-owned sugar mills, officials said.
The agreement was reached at the inaugural virtual meeting of the Bangladesh-Pakistan Joint Working Group (JWG) on August 10, with Pakistan offering technical expertise and assistance to address outdated machinery and low sugar recovery rates at Bangladesh's mills.
A senior official familiar with the matter said the two countries had formally initiated joint efforts to assess, repair and modernise Bangladesh's struggling state-owned sugar mills.
Under the proposed cooperation, Pakistan's state-owned Heavy Mechanical Complex (HMC), Taxila -- which previously installed Natore and Pabna sugar mills in Bangladesh -- will conduct technical audits of selected mills and prepare customised Balancing, Modernisation and Rehabilitation (BMR) proposals.
Pakistan has also offered to introduce modern sugar-processing technologies, including high-pressure boilers, falling-film evaporators, continuous vacuum pans and automated distributed control system (DCS)-based systems to improve operational efficiency and reduce production costs.
The two sides also discussed transforming conventional sugar mills into multi-product facilities to diversify revenue sources and improve their financial viability.
Such facilities could generate electricity, produce bioethanol from molasses and manufacture organic fertiliser using press mud, according to the proposed plan.
As part of the next phase of cooperation, a specialised Pakistani technical delegation will visit sugar mills across Bangladesh to conduct on-site assessments and feasibility studies. Pakistan has agreed to bear the delegation's travel and operational costs.
The Bangladesh Sugar and Food Industries Corporation (BSFIC) will provide the Pakistani technical team with relevant plant specifications, operational information and baseline data through diplomatic channels.
Bangladesh will also formally invite the Pakistani team to inspect the mills and assess their modernisation requirements.
Following the field assessments, Pakistan will prepare comprehensive feasibility reports and investment proposals for the rehabilitation and modernisation of the mills.
The proposals are expected to provide a basis for future investment and financing discussions between the two countries.
The initiative comes as Bangladesh's state-owned sugar mills continue to struggle with ageing machinery, low capacity utilisation and poor sugar recovery, making technological upgrades and product diversification increasingly important for improving the sector's sustainability.
There are currently 15 mills under BSFIC, with an annual production capacity of only 0.21 million tonnes. The output is far below Bangladesh's annual sugar demand of more than 2.2 million tonnes. The country therefore imports around 2.2-2.4 million tonnes of raw sugar annually to meet domestic demand.
Officials said nine of the 15 mills are currently operational. However, outdated technology, ageing equipment and low sugarcane recovery rates have resulted in high production costs and poor efficiency.
In 2020, production activities at six mills -- Pabna, Shyampur, Panchagarh, Setabganj, Rangpur and Kushtia -- were suspended to reduce heavy financial losses.
The industries ministry has undertaken several projects to diversify sugar products by tapping the mills' existing potential and making them more commercially viable. Some of these projects are already being implemented, officials said.
