Muhammed Aziz Khan’s argument is that corporatizing or partially privatizing these entities would switch logistics danger and worth publicity to succesful non-public operators.
When QatarEnergy invoked power majeure on March 2, 2026, Bangladesh’s state fuel procurement company watched its deliberate LNG provide for April disappear, cargo by cargo, over the following 4 days. Three different suppliers adopted throughout the week.
Petrobangla turned to the spot market and located costs above $23 per MMBtu, greater than double the contracted charges it had simply misplaced. The shortfall translated rapidly into manufacturing unit curtailments, CNG rationing, and prolonged day by day energy outages.
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The episode uncovered the mechanics of an association that Muhammed Aziz Khan, chairman of the power conglomerate Summit Group, had been drawing consideration to within the previous months. Bangladesh’s power procurement sits virtually solely inside two state entities: Bangladesh Petroleum Company and Petrobangla’s procurement subsidiary RPGCL. These entities carry the nation’s full publicity to commodity worth swings and provide disruptions with out the industrial flexibility a extra distributed construction would offer.
‘Privatization Is Key’
Khan’s argument, made in a February op-ed in The Enterprise Commonplace and elaborated in an April 3interview with S&P International Commodity Insights, is that corporatizing or partially privatizing these entities would switch logistics danger and worth publicity to succesful non-public operators whereas decreasing the subsidy burden the federal government has struggled to comprise.
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“Privatization is vital to securing international direct funding,” Khan advised S&P International. “LNG import, power oil import and distribution infrastructures could also be a primary step towards that.”
In FY2024-25, Bangladesh’s energy sector subsidy invoice was projected to rise 55% year-on-year, whilst electrical energy tariffs climbed greater than 20% over the prior yr. Between February and April 2025, oil-fired technology consumed 29.27% of complete gasoline prices whereas contributing solely 10.27% of grid energy.
The argument is that inefficiency is embedded within the state procurement mannequin. Companies working below coverage constraints face completely different incentives than industrial operators managing their very own steadiness sheets.
Khan grounds the argument in Bangladesh’s personal coverage report. The nation imports hundreds of thousands of tonnes of meals grains and edible oils yearly by non-public merchants. Procurement is aggressive. Provide continuity has held with out the state carrying the value publicity. The power sector runs on a special mannequin. Procurement authority is concentrated. A single authorities company absorbs worth and foreign money danger, with restricted non-public involvement on the import stage. Khan’s argument is that the distinction displays a coverage alternative, not a technical constraint.
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Bangladesh’s Procurement Infrastructure
The non-public energy technology framework established in 1996 has delivered complicated infrastructure reliably for 3 a long time. Bangladesh’s LNG import infrastructure is already managed by non-public operators. Summit’s FSRU, in operation since April 2019, has obtained roughly 35 million cubic metres of LNG and equipped roughly 785 million MMBtu to the nationwide fuel grid.
The terminal covers round 13% of the nation’s complete fuel demand and accomplished its 250th ship-to-ship switch in 2025. Non-public participation in power infrastructure already works at scale. Khan’s argument is that the mannequin ought to lengthen upstream, into procurement itself.
The procurement structure he’s difficult contrasts with how main LNG importers construction their shopping for operations. Economies with extra distributed procurement fashions unfold negotiating energy and provider relationships throughout a number of industrial actors. When one provide route closes, parallel channels can stay energetic. Bangladesh’s present construction concentrates that publicity in a single place.
The continuing Hormuz disaster has examined it straight. Petrobangla was compelled to barter emergency spot purchases below acute time stress, in a market the place better-positioned consumers had already secured the accessible cargoes.
Corporatizing or partially privatizing BPC and RPGCL would change these incentive buildings, argues Khan. Non-public operators face their very own steadiness sheets and have clearer incentives to construct diversified provider relationships and strategic storage. The Hormuz disaster confirmed what the present construction prices when these capabilities are absent.
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Khan advised S&P International that Bangladesh’s LNG imports are anticipated to achieve 7.2 million metric tonnes per yr in 2026 and will rise towards 15 million within the coming years. State entities carrying the present subsidy burden will not be positioned to draw the funding that enlargement requires on industrial phrases. Non-public procurement entities working below industrial governance current a special danger profile to worldwide lenders and fairness buyers than companies embedded in a sponsored pricing system.
Bangladesh reached 100% electrical energy entry by a technology mannequin that put undertaking danger on non-public operators and required them to supply their very own financing. That framework delivered. Khan’s privatization argument applies the identical logic to procurement, the place the state at present absorbs dangers that non-public capital might carry extra effectively. The Hormuz disaster has made the structural case tougher to defer.
