The PEPZ board has again formed a committee on the KEPZ with a one-month deadline to take a final decision.

But meeting sources said policymakers want the KEPZ to return 500 acres of its land to the government out of 2,500 acres the Koreans acquired in 2001.

The KEPZ had paid for 2,700 acres of land -- mostly khas and some fallow land -- at a hilly location by the Karnaphuli river in Chittagong. But it gave up 200 acres due to various reasons related to the locality.

The KEPZ authorities headed by South Korean company Youngone was verbally asked to give up the 500-acre land last month. The KEPZ however declined the proposition saying there is no valid reason behind it, the sources added.

With Prime Minister Khaleda Zia in the chair, the PEPZ held its meeting yesterday -- after a gap of 28 months -- to consider awarding the licence, which is hindering the launch of KEPZ operation.

The KEPZ expects to draw an estimated $1 billion investment and set up 500 industrial units.

Meeting sources said yesterday's meeting formed another committee to amend some rules and by-rules related to the Private EPZ Act, 1996. An earlier PEPZ committee in 2003, however, ruled out the need for amending any rules or by-rules.

"The meeting was inconclusive, but the government is moving in a positive direction," a meeting source said, adding, in the next one month the PEPZ expects some clarifications from the KEPZ and there will be 'negotiations' on land related issues.

The last meeting of the PEPZ board held on April 10, 2003 had formed a committee headed by the principal secretary to the prime minister to amend the Act in line with the laws of the land.

The meeting decided that after the amendment, the government would consider awarding licence to the KEPZ.

The Principal Secretary Committee on July 17, 2003 filed its report saying there was no need to amend the Act as it did not contradict with existing laws.

Besides, the government already gave licence to a second private EPZ -- the Rangunia EPZ -- in December 2000 under the same Act. Therefore, amending the law would create new legal complications.

The committee had recommended, "in the interest of foreign investment and to protect the image of the country, the government may award the licence to the KEPZ."

The KEPZ spent about Tk 100 crore for the land purchase and infrastructure development. Youngone is present in Bangladesh from 1978 and it became a multinational giant based on its growth in this country.

However, some Chittagong-based ruling party lawmakers and their friends are eyeing the KEPZ land since it was developed. They sent anonymous letters to the prime minister in early 2002 posing as "local people", saying this land was given to the KEPZ through bribery.

The KEPZ land falls under the police stations of Anwara, Patia and Bandar.

A retired government official, who was involved in the land acquisition process in 2001-2002, said, "Most part of this land was unused and no part was used for agricultural purpose."

"Nobody took interest in it before. It's a poor region. Now that land price has gone up and an EPZ is set to go there, some influential people just want a piece of the cake," said the official hailing from Anwara.