"We should not expect we could complete all formalities as speedily as we do in an European country. But obviously, if we find the investment negotiation is being delayed long enough, we may reconsider our plan," said Alan Rosling, executive director of Tata Sons Ltd, in an exclusive interview with The Daily Star on Sunday.

"We have already lost six months for negotiation", pointed out Rosling, who arrived in Dhaka earlier on the day to participate in the final round of negotiation with the government that started yesterday.

He strongly disagreed with the government proposal to set a higher price for a guaranteed gas supply for 20 years.

Rosling noted that mills across the world produce steel using gas at a price that is considered economically viable and with its supply secured. "You will not invest $3.0 billion where gas supply might stop tomorrow," he said.

The government offer for 1.25 trillion cubic feet (Tcf) gas supply is inadequate as Tata will need 2.16 Tcf gas for its steel plant (for 25 years) and power and fertiliser plants (20 years each).

The government however suggested Tata to use coal as an alternative energy source but the company does not view this as an alternative.

"We need a certain amount of gas for the economic life line for our projects. But coal cannot be a substitute for gas. Now, it depends on the government if it would agree to offer gas to Tata or not," Rosling said.

"If the government agrees to supply gas for the steel plant, only then Tata can consider setting up a steel plant. Otherwise, it will not go for the steel unit."

If Tata believed that gas is an issue in Bangladesh, it would not have come here or started the process of investment.

The Tata executive is hammering on a good package of tax incentives. "If you like to have infrastructure projects, the major capital projects whose payback period is 10 years or 20 years, you have to provide a good package of incentives to the investors," he said.

He mentioned that the government negotiators have already agreed to develop a package of incentives for the projects.

Asked why they have chosen Bangladesh as their major FDI destination, Rosling said Bangladesh has various opportunities, which may help reduce cost of production.

The cost of funds and land may be high in Bangladesh but the exchange rate will create better opportunity for the projects here compared to other countries in South Asia, the Tata negotiator said.

He claimed that the Tata investment will help increase gross domestic product (GDP) by almost two percent and directly create 26,000 jobs. Moreover, it will speed up economic development and improve the balance of payment situation. Eventually, these factors will give positive signals about the creditability of Bangladesh to other foreign investors.

The Tata executive thought Bangladesh's population of around 140 million, 5-6 percent economic growth rate a year, democratic order and its location in association with the growing South Asian economy show it has tremendous potential.

Rosling observed that Tata investment would also help expand relations with India and build integration among the South Asian countries.

He expressed disagreement with the common public impression in India that the rising Islamist element in Bangladesh is a major problem and said this element is not strong to act as a barrier to investment.

On April 20 last year, Tata submitted its $2.5 billion investment proposal for setting up a 1,000 MW power station, a steel mill with an annual production capacity of 420,000 tonnes and a one million-tonne fertiliser unit.

Later on May 9, the government and Tata agreed to begin negotiations from May 25, conclude it by August 31 and sign the agreements before November 30 the same year.