Tk 3,000 crore light engineering industry could go global


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Tk 3,000 crore light engineering industry could go global

Jack Jesus

Several dozen of Chinese, Thai and Malaysian investors have shown interest to build join venture at country’s light engineer sector. But inadequate land, uninterrupted power supply and unavailability of gas  hold them back, sources said.

A group of Chinese investors recently visited Old Dhaka and Bogura to establish spare parts factory for auto mobile but they sought specialized industrial plot, Abdul Hakim, an owner of Hakim Engineering at Dholai Khal, Dhaka told Business Mirror.

“They are interested to invest over Tk 100 crore unit here in Dhaka. They are also contemplating to transfer technology from China, Hakim added.

Over 50,000 workshop employing around 800,000 people across the country mainly in Dhaka, Chittagong, Narayanganj, Bogura, Gazipur, Kishorganj.

Those workshop produces over 3,000 types of quality machinery, spares and accessories of automobile, bicycles and cycle rickshaws, jute and textiles mills, chemical machine, sugar and food industry machine and agricultural machine accessories and spares.

Self motivated and technically educated people save over Tk 10,000 crore a year by producing those machine parts without any institutional help.

To give the sector a boost, Prime Minister Sheikh Hasina declared “Light Engineering goods” as the “Product of the Year” for 2020.

International Finance Corporation (IFC), in partnership with the UK Department for International Development and the Norwegian government in a study, shows that LES (light engineering sector) employs 6,00,000 people involved in 50,000 micro enterprises and 10,000 Small and Medium Enterprises.

Inadequate fund is a major hurdles to the sector’s growth “Bank loans are still not available as per the need of this sector” Abu Raihan another entrepreneur said.


“I did not get money from a bank by seeking collateral free loan to expand my business. But I have still not got it due to some complicated procedures.” Raihan said.

Sheikh Mohammad Delwar Hossain, owner of Aziz Metal Engineering Works and joint secretary general of the Bangladesh Engineering Owners Association (BEIOA), said that many foreign investors were showing interest in investing in this sector under joint collaboration but a crisis of land and other facilities was holding them back.

Hossain said that, in Bangladesh, light engineering firms were operating in clusters in different districts. In spite of repeated appeals by the BEIOA, a common facility centre (CFC) was yet to be established in any cluster. “Establishment of the CFC is vital to upgrade the technological edge of the light engineering sector,” he said.

Abdur Razzaque, president of the BEIOA said “The sector only needs support in getting land, appropriate technology, finance, raw materials and forming a consortium of small workshop owners. We do not need aid from the government or foreign donors. If the government gives policy support, the sector will show how it can change the country’s economic status”, .

About the complications regarding bank loans, Razzaque said the central bank received loans worth Tk 500 crore from Japan at a rate of 0.01 per cent but the leasing and financing institutions took it from the central bank at 5 per cent and lent it out to the light-engineering manufacturers at 18 per cent.



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