Monthly Archives: June 2009

Jute bag exports rise as shopping goes eco-correct

Jute bag exports rise as shopping goes eco-correct

Kawsar Khan

Eco-concerns drive demand for biodegradable bags on the global market, giving rise to the exports of shopping jute bags from Bangladesh.

Jute goods makers export around 100,000 shopping bags a month on average to different countries. They hope scope for more shipments will widen next year, as some European countries are set to ban polythene bags in 2010.

“In our products line, shopping jute bags are the most popular among importers as European and American consumers are opting for environment-friendly bags which can be used repeatedly,” said Milton Suranjit Ratna, a senior officer of Corr-The Jute Works, the handicraft marketing and exporting trust of Caritas Bangladesh.

Corr-The Jute Works exported over 600,000 jute bags in 2008 mainly to Germany, the Netherlands, Sweden, UK, USA, Canada, Japan, Switzerland, South Korea, and France.

Creation Private Limited, a jute goods maker, exports around 50,000 shopping bags to those destinations a month.

Two years ago, the number of jute bags exported by Bangladesh would not exceed 100,000 annually, said the sector people.

A global initiative for banning environment-unfriendly shopping bags and declaring the year 2009 by the United Nations as International Year of Natural Fibres has fuelled demand for jute bags.

According to media reports, France and Germany will ban the use of non-biodegradable polythene bags next year. Also, the US is looking for a viable alternative to polythene bags.

San Francisco has completely banned plastic bags. Los Angeles will do so in 2010. Also, Washington, D.C.’s city council is set to vote on a five-cent-a-bag tax later this month.

Now the United States uses an estimated 90 billion thin bags a year, with most used to handle produce and groceries.

Achim Steiner, executive director of the UN Environment Programme, has recently called for a ban on polythene bags and said: “Single-use plastic bags which choke marine life should be banned or phased out rapidly everywhere. There is simply zero justification for manufacturing them anymore, anywhere.”

The global context has made a multi-billion dollar global shopping bag market, opening up a huge opportunity for the country’s golden fibre.

On the potential of jute bag exports from Bangladesh, the sector people viewed that non-perishable polythene bags will go out of market in the years to come, driving demand for Bangladeshi jute bags.

On the other hand, more and more chain shops around the world are phasing out the use of polythene bags in their shops and using bio-friendly natural fibre bags instead.

Ratna said only the UK-based retail chain Tesco requires around 1 million shopping bags — made of natural fibre — a month that it now buys from India.

“Tesco had approached us to buy bags but we could not take their order as our bags were costlier than in India,” said Rashidul Karim Munna, managing director of Creation Private Limited.

Munna said local bag makers buy jute fabric from the domestic market at higher prices than what foreign importers pay for the same fabric from Bangladesh — a setback that makes the local industry less competitive than its rival in India, the main importer of jute fabric.

“When we buy jute fabric, the jute mills add the money of export incentive to the cost of fabric as they don’t get any incentive when they sell to us,” Munna said.

“Unlike in India, jute bag makers in Bangladesh do not get export incentive,” he said.

“It is very sad that even after buying raw materials from Bangladesh, India can sell shopping bags at lower prices,” he said. A shopping bag sells at $1.

Despite having all the difficulties, however, increasing orders are pushing bag manufacturers to expand their capacity.

“Due to the increased demand we will set up a new bag manufacturing unit in Tongi, which will go into operation next month,” said Bertha Gity Baroi, acting director of Corr-The Jute Works.

The sector people believe Bangladesh has every chance to strengthen its foothold in the billion-dollar shopping bag market.

“We could easily double our production and exports if we got proper government support,” an official of Corr-The Jute Works which has long been reputed for exporting handicraft products.

Joint venture to invest $5m in AEPZ

Joint venture to invest $5m in AEPZ
Bangladesh Sangbad Sangstha . Dhaka

Bengal Pelli (BD) Limited, a Bangladesh-Portugal joint venture company, will set up a leather footwear industry in the Adamjee Export Processing Zone.

The joint venture company will invest about $5 million in establishing the plant to produce leather footwear, a news release said on Monday.

The company will also create employment opportunity for 621 Bangladeshi nationals, the release added.

An agreement to this effect was signed between the Bangladesh Export Processing Zones Authority and the Bengal Pelli (BD) Limited in BEPZA Complex in Dhaka on Monday.

Nasir Group eyes Tk 300cr in sales from new plant

Nasir Group eyes Tk 300cr in sales from new plant

Sajjadur Rahman

Nasir Glassware and Tube Industries is expected to earn nearly Tk 300 crore in annual sales from its new plant to be pressed into operation at the end of this year, a top official said yesterday.

The Tk 600 crore plant is being set up on a 125-bigha of land at Sohagpur under Mirzapur upazila of Tangail district. Some 85 percent of construction is complete.

“We expect Tk 15 crore in monthly sales from glassware and Tk 10 crore from tube lights,” Nasiruddin Biswas, managing director of Nasir Group, told The Daily Star, quoting a feasibility study on the new plant.

Around Tk 100 crore worth of letter of credits have been opened for import of machinery and equipment for the company, Biswas said. The company has invested another Tk 200 crore for construction and land acquisition.

Nasir Group, which started its business in a humble way with the making of biri (traditional handmade low-cost cigarette), now boasts glass, melamine, printing and packaging and footwear units.

The group’s annual turnover crosses Tk 2,000 crore. It pays a monthly average of Tk 13 crore in value added tax to the national exchequer, according to available statistics.

Nasir Glassware and Tube Industries will be the first of its kind in the country and will compete against a tide of imported goods now dominating the glass tableware, fluorescent and energy-saving bulb market here.

Glassware products that will be manufactured at the plant include tableware, flower vase, perfume bottle, bowl and candle stand. All of the items are imported from different countries such as China, Thailand, Malaysia and Indonesia.

The market size of fluorescent and energy-saving bulbs is also rising on the rise of the user’s consciousness about an efficient use of electricity. The energy-saving bulb market will boom once the government makes its use mandatory, officials said.

Citibank NA has recently arranged Tk 140 crore loans for Nasir Glassware and Tube Industries at a 12 percent interest rate.

“Both glassware and energy-saving bulbs will be import-substitution industries. They will also be able to export in the near future,” said Mamun Rashid, country officer of Citibank NA in Bangladesh.

Govt working to introduce industrial policy soon

Govt working to introduce industrial policy soon
Says Barua
Star Business Report

The government has taken initiatives to formulate an industrial policy immediately with an aim to create more employment and enhance the economic growth of the country, said the industries minister yesterday.

“We are trying hard to turn Bangladesh into a middle-income country by 2021 and for that we have to go for massive industrialisation soon,” said Dilip Barua.

“The new industrial policy has an aim to encourage establishing more industries and create more employment opportunities,” he added.

He was speaking at the annual general meeting (AGM) of SME Foundation in Dhaka.

Barua said the government is giving priority to the country’s small and medium enterprises (SMEs) through budgetary allocation and policy support to generate employment that would help eliminate poverty.

Dr Momtaz Uddin Ahmed, managing director of SME Foundation, and Dewan Zakir Hossain, secretary to industries ministry, were also present at the AGM.

Renata to export drugs to 15 more states

Renata to export drugs to 15 more states

Sarwar A Chowdhury

Renata Ltd, one of the leading pharmaceutical companies and a market leader of animal health products in Bangladesh, plans to export its medicines to 15 more countries in bid to strengthen its presence in global market.

The company is expecting to make a footstep in Afghanistan, Cambodia, Thailand, Benin, Burkina Faso, Congo, Togo, Mauritius, Malaysia, Nigeria, Ghana, Cameroon, Gabon, Senegal and Ivory Coast in the coming days, senior officials of Renata said.

Presently the company does business with Sri Lanka, Vietnam, Myanmar, Hong Kong, the Philippines, Macao, Jordan, Kenya, Guyana and the UK.

“We expect to be in those countries during 2009-10 fiscal year,” Syed S Kaiser Kabir, chief executive officer and managing director of the company, told The Daily Star.

When asked about potential export earnings from the new destinations, he said: “Export markets are uncertain and sales cannot be predicted with accuracy, especially in the pharmaceutical business.”

He however expected 30 percent to 35 percent growth in sales and profit in the coming year.

Renata, which registered a 65.5 percent export growth last year, has filed 300 product dossiers to 21 countries to accelerate its export growth this year.

“These products will drive future volumes,” according to Renata’s annual report, which was presented in the company’s annual general meeting recently.

A listed company, Renata exported products worth $815,660 last year.

The net profit of the company, which contributed Tk 61.76 crore to the national exchequer, grew by 28.9 percent to Tk 43.31 crore on a net turnover of Tk 380.97 crore in 2008.

“While this performance is quite modest in relation to the track record of Renata, it must be judged in light of the difficult circumstances that characterised the year,” the annual report said.

“By the middle of 2008 it appeared that our earnings growth estimates would have to be revised downward. Fortunately, better-than-expected figures for contract manufacturing, interest costs, exchange rate depreciation and inventory revision provided a cushion against the cost increases,” it said.

The onset of global recession reversed the trend in petrochemical prices that in turn eased the pressure on pharmaceutical raw materials’ costs, the report said.

Despite the unfavourable developments, outlook for Bangladeshi pharmaceutical companies remains positive, it said, adding that the industry has so far remained unaffected on the domestic front.

Mi3 raising equity to develop outsourcing and more in Bangladesh

Mi3 raising equity to develop outsourcing and more in Bangladesh

June 24, 2009

EXCLUSIVE REPORT ALPHARETTA, GA—Mi3, a company that offers IT outsourcing to Bangladesh as a less expensive alternative to India, China, the Philippines, and other countries, is raising a $6 million round of equity. The company is also developing IT products to sell in Bangladesh and envisions helping the country with healthcare and education, says founder and President Saiful Khandaker.

The company revealed that it is raising $6 million in equity in a filing with the U.S. Securities and Exchange Commission. It has raised $1 million so far.

Bangladesh, which borders India and Burma, is the seventh most populous country in the world and has a high poverty rate. Khandaker, who was born in Bangladesh but lived half his life in the United States, says he saw the potential for establishing outsourcing in Bangladesh while working for Delta Airlines as a software engineer.

“We founded the company with the vision of following the model India took in outsourcing,” he says. The vision includes helping Bangladesh play a greater role in the global economy, he adds. He emphasizes that the company has philanthropic goals as well as business goals.

In 2003, Khandaker took on two U.S. partners in the firm. The company has 12 U.S. employees and 300 in Bangladesh.

The company is talking with several Fortune 500 companies about doing outsourcing to Bangladesh. “We’re offering an alternative that is untapped and better in cost and quality than outsourcing to Russia, India, China, the Philippines and other established outsourcing countries,” says Khandaker.

The company is also working on a deal to develop a mobile phone payment system for people in Bangladesh who do or do not have banks. “People will be able to send and receive money or go to McDonald’s and buy a burger with their phone,” via the system, Khandaker says. Launching a product in Bangladesh is easier than in the U.S., he adds, because there aren’t many competitors.

The company is also in discussion with the Bangladesh government on several deals. It is bidding on a project to develop electronic passports.

It is also developing a project that could help entice U.S. firms to build manufacturing or distribution facilities there. “We’re working to build a high tech park in Bangladesh,” Khandaker says. “We would manage the park and lease out space. We’re putting the plan together next month.”


Knitwear on way to get a boost

Knitwear on way to get a boost

Colours of Merino wool

Colours of Merino wool

Kazi Azizul Islam

Bangladesh knitwear industry is on the way to get uplift from cotton-based produces to genuine woolen items as a leading organisation from Australia has established business relations with some leading local knitters.

The business relations will facilitate Bangladeshi knitters to produce woolen sweaters those will yield more business, extra profit and help increase manufacturers’ image abroad.

The organisation, Australian Wool Innovation, has recently grouped up with some Bangladeshi manufacturers to source Marino wool products from Bangladesh, said officials of the Bangladesh Garment Manufacturers and Exporters Association.

The officials said Bangladeshi knitwear exporters, who used to produce cotton-wear, would now be producing woolen-wear for exporting those to global market.

He said, some of the exporters had already started producing sample items for global marketing.

Originated in Australia and New Zealand, Merino wool is regarded finest and softest and economically viable variety of wool.

The AWI last week launched a programme titled ‘Out of Bangladesh’ to inform global importers that some Woolmark-accredited Bangladeshi knitters have proven performance in making fine-gauge Merino wool knitwear.

Woolmark is the globally recognised Australian accreditation that specifies pure new wool through a stringent testing for quality and performance of the finished garment.

After China and Turkey, Bangladesh has world’s third largest knitwear industry, but it so far concentrates on bulk quantity of cotton-based low-cost sweaters.

In 2008 sweater exports amounted at $1.8 billion, which was 15 per cent of Bangladesh’s entire apparel export earning.

A very few local sweater manufacturers are trying to produce high value cashmere sweaters by sourcing died wool yarns from Mongolia or India, the officials said.

The BGMEA officials said AWI already provided technical supports to their Bangladesh partners to produce sweaters with wool yarn.

‘Such tie-up will not only create market in Bangladesh for Australian wool yarn, also uplift Bangladesh’s sweater and knitwear industry,’ said Saifur Rahman, former chairman of the textile engineering department of the City University, a private university in the capital city.

Ghulam Faruq, chairman of SQ Group, one of the Woolmark licensed manufacturers, says, now importers pay between $60 and $72 for a dozen of cotton sweaters while export price for woolen sweaters ranges between $180 and $480.

‘High value cashmere and medium value Marino wool sweaters have tens of billion dollar worth market globally so Bangladesh should eye that market segment,’ said Faruq.

He added that machines generally used now by the Bangladeshi sweater manufacturers were compatible to Australian wool yarn so the industry could go for producing wool-based sweater easily.

Cement makers fortify Indian foothold

Cement makers fortify Indian foothold

Kawsar Khan

Bangladesh’s cement exports to seven north-eastern states of India, also known as ‘seven sisters,’ have marked a rise in recent months, which is, manufacturers think, because of the reputation the local quality cement brands have earned in the neighbouring country.

Besides quality, competitive price of the construction material has encouraged the Indians to use Bangladesh made cement in public infrastructure development works in the ‘seven sister’ states, especially Tripura and Assam.

Around 12,000-14,000 tonnes of cement a month are now exported to India, while the item’s monthly export figure was 8,000 tonnes a year earlier, Bangladesh Cement Manufacturers Association data show.

“Apart from the reputation of quality, cheaper costs to transport cement from Bangladesh to the Indian states because of much more geographical closeness than the western part of the neighbouring country have also contributed to the high demand for our cement, ” said Mostafa Kamal, president of the cement makers’ trade body.

Kamal also expressed his pride about Bangladesh made cement’s quality and competitive price despite the fact that the country is dependent on the imports of raw materials, mainly clinker, for the item when India by its own produces the necessary raw material.

Bangladesh imports clinker from China, Indonesia and other countries.

Abdul Quayum Mia, executive director of Madina Group, the parent company of MTC Cement Industries Ltd, also pointed to the huge infrastructure development works in ‘seven sister,’ which helped raise the demand for cement.

An official of MI Cement Factory Ltd, a leading cement exporter that produces Crown Cement, said recently the company has received an export order of 12,000 tonnes of cement from Tripura.

Officials of Holcim (Bangladesh) Ltd said it exported 32,000 tonnes of cement in 2008.

“On an average we can export an amount between 2,500 and 3,000 tonnes a month to India,” said Shankar Kumar Roy, general manager (Business Development) of Holcim.

Mujibur Rahman, deputy manager (Export) of Seven Circle (Bangladesh) Ltd, said his company has, for the first time, exported cement to India through water vessels.

“We exported around 8,000 (400 tonnes) bags to West Bengal in early June through waterways, while cement is usually exported by road,” said Rahman.

The sector people are upbeat on achieving the feat of increasing exports to India, although the Indian government has, from this year, imposed around 26 percent duty on the imports of cement from Bangladesh.

They expect the exports to rise up to 20,000 tonnes a month in near future if demand continues.

Some 10 local and multinational cement manufacturers out of the 35 cement factories in operation export their products to Indian states.

Shah Cement, Meghna Cement, Aramit and Premium are other brands that are also in the export-basket. Local manufacturers can produce around 20 million tonnes of cement annually against the demand for 8.5 million tonnes.

Meanwhile, the industry insiders have pointed to the other side of the coin. They said they struggle locally because of the low price on the item’s falling demand.

“In the last few years prices of all types of construction materials, except cement, have showed an upward trend, though raw material prices went high,” said the cement makers’ association chief.

He urged the government to intensify public works to create domestic demand for the cement industry.

Export earnings up by 12.76pc in 10 months

Export earnings up by 12.76pc in 10 months

The country’s export earnings during the ten months of the current fiscal (July 08 to April 09) totalled to US dollar 1,282 crore against US dollar 1,137 crore of the same period of the last fiscal, marking a rise by US dollar 145 crore or 12.76 per cent.

The earnings from export of woven items in ten months of this fiscal totalled at US dollar 490.20 crore, against previous fiscal’s US dollar 418.05 crore, according to data of the Export Promotion Bureau (EPB).

On the other hand, export earnings from knitwear garments in the period stood at US dollar 523.10 crore, against US dollar 439.20 crore during the same period last fiscal, marking a rise by 19.8 per cent.

Earnings from exports of woven garments, terry towels, handicrafts, computer services, chemical fertilizer, medicine, shoes, vegetable, melamine, tobacco, home textiles, textile fabrics marked rise during the period, while that for exports of raw jute, tea, jute goods, electronics, leather, frozen foods, ceramic products, petroleum by-product, bicycle, marked fall.

The export price index during July 08-April 09 marked a rise by 0.42 per cent and the export index in volume rose by 14.47 per cent.

President of Bangladesh Economic Association Dr Kholiquzzaman Ahmed said despite global recession, the export earnings of Bangladesh maintained upward trends as the low- earning people across the globe including USA wear garments of Bangladesh.

The number of low-earning people across the globe has increased and for that the sale of readymade garments from Bangladesh has not reduced, he added.

Grameen Shakti to launch solar power system in Dhaka, cities

Grameen Shakti to launch solar power system in Dhaka, cities

Mushir Ahmed

Renewable energy leader Grameen Shakti has said it would launch its service in Dhaka and major urban centres this month to meet the fast-growing electricity need in the country’s major cities.

The social business enterprise would make the much-expected foray by selling solar household systems to two of the capital’s top restaurants, its award winning chief executive Dipal Barua told FE.

The company has also designed a raft of new solar energy packages for the city’s hundreds of thousands of houeholds, Dipal said.

“We will sell SHSs that can ensure uninterrupted power for at least four hours in the night. There is already a big queue for our services.”

The move comes amid acute power shortages in the capital Dhaka and across the country. The electricity crunch has become so severe that in some areas the costly Instant Power Services can’t cover the outages.

Experts said the move would change the country’s renewable energy landscape, boosting their growth in areas left unexplored by the country’s top solar energy leaders.

Dipal said they were making entry into the capital as they saw huge demand for solar power among the middle and upper class people.

“The IPS is no longer a viable solution for power cuts in the capital. If you don’t have enough grid power, you can’t even charge your IPS battery, which is prompting people to think of alternative solution,” Dipal said.

Abser Kamal, the general manager of the GS, said the company would sell SHS package between Tk 60,000 and Tk 114,000, depending on the need of the clients.

“The minimum package would power two ceiling fans and two energy saving bulbs. The Tk 114,000 package would power three ceiling fans, a 21-inch colour television and three bulbs,” he said.

GS officials said they can now compete with IPS providers, given the severity of the power situation in the capital.

“Unlike IPS, our solar panel is warranted for 20 years. And it’s not taking any energy from the grid for conservation. We have enough solar power and we are just making maximum use of it,” Dipal said.

He said the city packages had become costlier as they were not getting any soft-loan refinancing from the state-owned renewable energy lender, IDCOL.

It was partly due to IDCOL’s easy refinancing scheme launched in 2003 that made Grameen Shakti a big success story in the country’s move towards renewable energy.

The company has so far sold around 300,000 SHS — covering a population of around 2.5 million people — in the areas where there is no grid electricity.

GS sells the SHSs between Tk 12,000 and Tk 50,000, with battery guaranteed for five years and panel 20 years.

Dipal said the company’s focus would still be on rural areas, where they were struggling to meet “overwhelming demand” for their products.

“Every month, we are adding some 10,000 SHS. The demand is such that we’ve upped our budget to Tk 7.00 billion this year from Tk 3.00 in 2008.”

Handicrafts industry posts 21pc growth in 10 months

Handicrafts industry posts 21pc growth in 10 months

Monira Begum Munni

The country’s handicrafts industry registered a 21 per cent export growth in the first ten months of 2008-09 fiscal year over that of the corresponding period of 2007-08 fiscal.

During July-April period of FY 2008-09, the earnings from the sector stood at US$ 5.43 million while it was US$ 4.50 million for the same period in FY2007-08.

According to the statistics released by Export Promotion Bureau (EPB) recently the earnings from the sector in the first ten months of the fiscal year is already 11.73 per cent up from the target of US$ 4.86 million.

The handicraft goods included items made from quality cloth, leather, paper, plastic and jute. These specialised products earned world recognition, Banglacraft secretary Md Shahjalal told the FE.

Giving his opinion on the impressive growth achieved, Md. Shahjalal said “Our craftsmen have amalgamated their skills with local culture reflecting tradition. This has made our products special and attracted foreign buyers.” Despite a robust performance the sector is being ignored by the government, claimed the leaders of Bangladesh Handicrafts Manufacturers and Exporters Association popularly known as Banglacraft.

“We need the government’s help for organising training on design, fashion and technology,” Banglacraft secretary said. Training institutes needs to be set up to improve the designs and quality of handicrafts, he added. Recently Banglacraft arranged a five-day long training on “Multipurpose Jute Products: Production and Distribution Management,” recently. The training programme was funded by SME Foundation.

Akij Group to branch out into new avenues

Akij Group to branch out into new avenues

Akij Group that boasts 20 entities plans to venture into some new businesses such as ceramics, renewable energy and fibreboard. Photo: STAR

Akij Group that boasts 20 entities plans to venture into some new businesses such as ceramics, renewable energy and fibreboard. Photo: STAR

Sajjadur Rahman

Business expansion defines Akij Group’s strong presence as a large Bangladeshi conglomerate, a move that runs counter to jitters from global recession.

Starting its journey in a humble way with bidi (traditional cigarette) and jute trading in the 1940s, the group presently boasts of having around 20 entities from tobacco to textile and particle.

Besides expansion, it has now plans to venture into some new businesses such as ceramics, renewable energy and fibreboard.

“We have already finalised selection of machineries and product lines for a tiles project,” said a senior official of Akij Ceramics Ltd.

Located near Valuka in Mymensingh district, the project will cost around Tk 170 crore.

Renewable energy is another front the group is going to focus.

“You can give credit to us as we are the first group in the country who will go for green energy. The setting up of a 12 megawatt bio-mass energy plant is now under process ,” said Sk BashirUddin, managing director of Akij Group.

The capacity of Akij Cement will also be enhanced by almost six times from 600 tonnes to 3,500 tonnes next month, an official said.

Akij Match, the group’s another concern which went into production just four years back, has now 60-65 percent market share of the total domestic demand. Beverages have also strong share in the market.

It is a talk everywhere in Bangladesh’s corporate circle that Akij is a group that can make anything marketable.

“We want to add more value in life by becoming a trusted and respected brand in Bangladesh,” said Sk Bashir, who took over the helm after the death of his father Sk Akijuddin, the founder of the largest conglomerate in terms of being the highest taxpayer.

Around Tk 2,000 crore tax was paid by the group in 2008, an amount that has been claimed to be the highest-ever by a group of companies in the country.

“We feel proud that a home-grown company pays around four percent of the country’s total taxes,” said the boss of Akij Group. It had over Tk 4,000 crore business turnover last year and employs nearly 50,000 employees.

On expansion, BashirUddin said, “We do expand to smoothen the supply of different products we sometimes need internally. ”

He said the group means business and it will continue to do so.

Glassware, energy saving tubes from local co on cards

Glassware, energy saving tubes from local co on cards

Siddique Islam

Nasir Group is going to expand their business by starting to produce glassware, energy saving bulbs and tubes for the first time in Bangladesh by the end of this year, a company official said.

The new project named Nasir Glassware and Tube Industries Ltd is being established with an investment of Tk 6.00 billion at Mirzapur in Tangail district aiming at meeting the country’s demand of glassware and fluorescent bulbs and tubes.

“We are sure that the new industrial unit would go into production by the end of this year,” Project Engineer of the Nasir Group Habibur Rahman told the FE Tuesday.

He also said it was an import substitution industry that would create employment opportunities for 900 people at different levels.

Currently, most of the glassware products are imported from various countries including China, Malaysia, Indonesia and Thailand to meet the local market requirements.

“Nasir group, one of the leading industrial conglomerates of the country, has plans to export glassware to Northeastern India, Myanmar and Bhutan after meeting local demands of the products,” Mr Rahman said.

Nasir group is now exporting 60 tonnes of float glass to different parts of Northeastern India each working day, he said, adding that the group also exports its products to Nepal and Bhutan.

The market for fluorescent and energy saving bulbs has soared after witnessing huge growth in the last couple of years, market operators said.

The government has already reduced customs duty on energy saving bulbs to encourage their use in the country in the wake of huge power shortfall.

“The government may ban the traditional bulbs in the near future to save precious energy,” the project engineer said, adding the group will produce energy saving tubes along with normal tube lights from the new project.

Citibank, N.A. Bangladesh has extended a credit facility of Tk 1.40 billion including project finance to the glassware and tube project of Nasir Group.

“In the future, the new venture hopes to compete with other Asian countries in exporting glassware and tube lights from Bangladesh,” the US-based Citibank said in a press statement.

Nasir Group, originally a regional bidi manufacturer based in the country’s western Kushtia district, became a household name after it set up the country’s first float glass factory.

The group is also the country’s biggest melamine manufacturer, has a sports shoes plant and sells low-priced cigarettes.

Named after its owner Nasir Uddin Biswas, the group has an annual turnover of over Tk 10 billion.

$2.5m factory to be set up in Comilla EPZ

$2.5m factory to be set up in Comilla EPZ

Bentasa Apparels (Pvt) Limited, a local company, is going to set up a garment accessories manufacturing factory in the Comilla Export Processing Zone (EPZ).

In this connection, an agreement was signed between the Bentasa Apparels and the Bangladesh Export Processing Zones Authority (BEPZA) in the city Tuesday, said a press release.

Member (Investment Promotion) of the BEPZA Prasanta Bhushan Barua and Chairman of the Bentasa AKM Jahangir Alam signed the agreement on behalf of their respective sides.

The company will invest US42.50 million in the project that would create employment opportunities for about 122 Bangladeshi people, the release added.

Rahimafrooz to set up solar panel assembling plant

Rahimafrooz to set up solar panel assembling plant

Photo: Syed Zakir Hossain

Photo: Syed Zakir Hossain

Sohel Parvez

Rahimafrooz Renewable Energy Ltd is set to assemble solar panels to grab the domestic market for solar home systems that are on an upward curve on the back of the government policy support to help off-grid people get electricity.

“We have taken initiatives to establish a solar panel assembling plant with an investment of Tk 34 crore by June 2010 as the market for solar systems is widening fast,” said Munawar Misbah Moin, managing director of the company, yesterday.

A concern of Tk 1,500-crore-Rahimafrooz Group, the company has been engaged in distributing solar systems for the last few years.

Since 2003 the use of solar home systems has been increasing fast in the off-grid areas of rural Bangladesh backed by over a dozen of NGOs that enjoy refinance facility from state-run Infrastructure Development Company Ltd (IDCOL), which promotes renewable energy development.

Now the number of solar home systems (SHSs) stands at around 325,000, up over 40 percent from 230,000 a year ago.

The SHS use increased because of the government aim to provide green energy solutions to majority of the country’s around 15 crore people who have a little or no access to electricity through national grid.

SHS installation is expected to grow faster as IDCOL plans to install 10 lakh units by 2012 to realise the government vision of meeting 5 percent of the total electricity demand by 2015 and 10 percent by 2020 through renewable energy resources, including biomass, biogas and wind.

Industry insiders said except for solar photovoltaic panels and tube lights, all the accessories for installing solar system with capacity of 20-120 watts come from the domestic manufacturers.

Solar panels and tube lights are usually imported from countries such as Singapore, India and China, with Japan-based Kyocera and TATA BP Solar controlling majority of the market.

Industry people said price of a complete SHS ranges between Tk 9,000 and Tk 60,000 and the solar panels account for nearly 70 percent of the total costs.

Rahimafrooz Renewable Energy expects that locally assembled solar panels will be more competitive than the imported ones.

“We make everything locally but still remain dependent on imports of solar panels. If we start assembling, we won’t need to depend much on the global market, and at the same time we will be able to provide 10-15 percent cost advantages to customers,” said Munawar.

The company, which claims a market share of about 40 percent in SHS, said the plant will assemble panels having a total yearly capacity of 5 megawatts.

Munawar said the total investment for the plant would be around $5 million (around Tk 34 crore) and the plant would be set up with technology support from a globally renowned company.

“We hope there is a prospect and that’s why we are taking the risk,” he said. “Our experience and knowledge in the field will help us attain the goal.”

Industry insiders also believe there is a prospect in renewable energy programmes as the government has attached priority to the sector, and is providing various financial and tax incentives to promote alternative energy development.

Recently the Bangladesh Bank has formed a Tk 200 crore revolving fund for banks and financial institutions to extend loans at low interest to areas such as renewable energy development.

In the proposed budget for fiscal 2009-10, the government also exempted VAT on solar panel and brought down custom duty on the prime accessory to zero from existing 3 percent.