At present, there are about 200 tanneries in Bangladesh. Most of which are located at Hazaribagh area. Most of these industries have no effluent treatment plant for the treatment of tannery effluents and the tanneries discharge different types of waste into the environment, particularly in the form of liquid effluents and solid wastes. The toxic effluents and solid waste contaminate soil, air and water of the area as well as the water of the adjacent Buriganga River and led to severe ailments such as eye diseases, skin irritations, kidney failure and gastrointestinal problems. To save the environment of Hazribagh and surrounding areas and the river Buriganga the government had taken an initiative to relocate the tanneries from Hazaribagh to the proposed Tannery Estate at Tetuljhora and Hazratpur union across the Dhalesshari River out side of Dhaka City. From general perspective the policy is economically and socially viable. But from planning perspectives there are some major weaknesses. The government needs to be conscious that the project will not result in externalities to others.