Monthly Archives: April 2011

BG to set up mini nuclear power plant

BG to set up mini nuclear power plant
Signs four agreements with US company

BG Chairman Ahmed Akbar Sobhan shaking hand with NIC International Inc. President Emily Robert Drwila after signing MoUs on four projects. East West Media Group Limited Chairman Mostafa Kamal Mohiuddin (extreme left) and the US Embassy’s political and economic counsellor John F Danilowic are also seen. SUN PHOTO

Staff Correspondent

Bashundhara Group has joined hands with a US company to set up the country’s first private sector nuclear power plant to help national efforts to resolve the electricity shortfall.

A memorandum of understanding (MoU) to this effect was signed between Bashundhara Group and globally reputed NIC International Inc. in the city on Sunday.

The mini nuclear power plant is expected to generate 20 megawatt electricity, company officials told the signing ceremony at the conference hall of East-West Media Group Ltd in the city’s Bashundhara residential area.

The country’s leading entrepreneur and BG Chairman Ahmed Akbar Sobhan and NIC Inc, President Emily Robert Drwila signed the comprehensive MoU that involves three other deals.

Bashundhara Group, under an umbrella deal, will also assemble laptop computers, net-book computers, touchpad, and electronic reader targeting the export market after meeting domestic demands.

In all, the BG is going to invest in four projects, all of which are aimed at bringing ultimate benefits to the people of the country, BG chairman Ahmed Akbar Sobhan said.

He mentioned that the mini nuclear plant would not meet the demand of electricity ‘but will surely set an example for other entrepreneurs to come up with similar initiatives’.

The commissioning of the nuclear power plant project will start soon, subject to approval from the governments of Bangladesh and the United States, the function was told.

The plant is expected to be set up in Manikganj and go into operation within February next year.

Akbar Sobhan said the investment projects would not only expedite the country’s digitisation process but also build national image abroad beside opening gateway for earning foreign exchange.

He thanked the US diplomats in Dhaka for lending their supports to the Bashundhara Group.

The agreement would help increase two-way trade between Bangladesh and the USA, the BG chairman said. Adequate employment opportunities will also be created through these projects for the local people, he added.

Intravenous solution and IV solution transfusion administration set factories will be established under a twin-scheme being undertaken by the two companies. The two units are designed as export-oriented enterprises.

Mostafa Kamal Mohiuddin, Chairman of East West Media Group Limited, said this type of plant would be suitable for addressing strategic needs of electricity as implementation of such a project takes only six to nine months.

“Tropical weather, dense population and scarcity of isolated land are also to be taken into account for medium and large scale nuclear power plant,” he said.

Mohiuddin noted that it is encouraging for Bangladeshis that laptop computers and electronic devices of high demand would be produced in Bangladesh and hit the mainstream Western market.

Appreciating the contribution of Ambassador James F Moriarty and his colleagues to striking the deals, the EWMGL Chairman said this collaboration is not only meant for business but also a symbol of friendly relations between the two countries.

John F Danilowic, political and economic counsellor of the US Embassy in Dhaka, said the technology devices which would be manufactured in the joint venture units would be exported to the USA with permission from the US government.

Chief adviser to BG Chairman Mahaboob Morshed Hasnu, Deputy Managing Directors of BG Mostafizur Rahman and Abul Kalam Azad, Media Adviser to East West Media Group Ltd Abu Tayeb, Editor of daily sun Prof Dr Sayed Anwar Husain, Editor of Kaler Kantho Abed Khan, Editor of Bangladesh Protidin Sahjahan Sardar and other high officials of both the companies were present at the signing ceremony.


Bangladesh: the next name in outsourcing

Business Life
Bangladesh: the next name in outsourcing

Ahmadul HoqM

Abdullah Mamun

Ahmadul Hoq, president of Bangladesh Call Centre and Outsourcing (BACCO), the industry body representing contact centre and business process outsourcing (BPO), speaks to The Daily Star on business opportunities for the call centre industry in Bangladesh. He works with the government and private sector to create strategies for the country to ensure that Bangladesh is the “next” destination of choice for outsourcing and offshoring.

How did you get involved with this business?

At first, I was involved in setting up a call centre in India. India is doing good business. In 2006, I tried to get permission from Bangladesh Telecommunication Regulatory Commission (BTRC) for voice over internet protocol (VoIP) operations, as my target was to set up a back office here in Dhaka. But the BTRC laughed it off. After a year, the BTRC published the call centre guideline. I worked on the formation of the guidelines.

What are you doing now?

I have a company called Virgo. It is an ISO standard company with 90 seats, and half of them are in use. Of course, we are working on voice services, but we are also doing virtual assistance, software development and content development. We plan to start a big venture soon.

Tell me more about the venture.

The new venture will be a global BPO company. I hope it will be able to create employment for 10 thousand graduates in the next five years. We will provide $100 million in salaries to our employees. When the backup fibre cable will be set up, a lot of work will be created for Bangladesh.

What is about the difference in terms of wage costs between the countries?

The cost of wages is far higher in the developed world than in Bangladesh. It is, on an average, $30 an hour in the European countries. It is even more in the US. India is paying $20 and the Philippines, $10 to $15. But it is still $8 in Bangladesh. So we are in an advantageous position, which is the most important asset for us. A $470 billion work opportunity in the US is waiting for us. It currently outsources 30 percent, while almost half of it can be offshored. Huge opportunities await us.

Which countries are in the call centre market?

Of course, India and the Philippines are the pioneers. South Africa, Indonesia, Sri Lanka, and Kenya are also in the business. Even Bhutan is working on it. The heads of state of India and the Philippines have prioritised the issue. They took 15 years to reach this situation. If we can do the same, we will also be able to capitalise on the opportunities. We need to form a committee that will report to the prime minister on the issue.

What is the scale of investment required to form a call centre nowadays?

If you want to set up a call centre of 30 seats, then you will have to invest at least Tk 1 crore. A large space is also required, which is very expensive in Dhaka. Telecommunication costs are not competitive, compared to other countries. But the problem is that we do not have trained people. The university students are not ready at all. So you will need to train them for about six months and training costs are also very high.

Revenue sharing with the government is now 0.5 percent but it should be eliminated for at least 10 years. Big businessmen should come to the sector with big investments. We have learnt how to get the business and the technicalities. None will come to us; we will have to go to them. So investment is also needed on the branding side and this is where the government should concentrate on.

Did you face any problems in receiving payment for work done?

A majority of the call centres in the country are facing this problem. Recently, a company did not receive payment worth Tk 14 lakh. The main company did not pay the money. We have no scope to file a case with the courts as laws differ from country to country. So, some local companies are setting up offices in the European markets to get the legal facilities of those countries.

What are your predictions about this sector?

It will not be impossible to deploy half a million people in the sector within the next five to seven years. Before acquiring international services, we need to unlock our home back offices. If the banks come across to offshore their back offices, it will help us obtain international contracts. We believe over 150,000 direct and 37,500 indirect jobs will be created within the next 10 years. It will be possible to earn at least $2 billion a year in foreign exchange.

Chittagong port to go for automation by next month

Chittagong port to go for automation by next month
Staff Correspondent .  Chittagong

Chittagong port, the country’s gateway to foreign trade, is expected to go for automation with the installation of a digital container terminal management system by the end of next month to modernise its operational activities.

At a view exchange meeting with local media on Sunday on the occasion of the 124th founding anniversary of the port, Chittagong Port Authority chairman M Anwarul Islam hoped introduction of the CTMS would increase the efficiency in handling cargo.

‘It will raise the standard of port operation through electronic system instead of paper-based documentation,’ he said, adding, ‘The automation will transform the port into a world class global shipping hub.’

He claimed such automation would also curb corruption and speed up port operation.

CTMS had become a crying need for catering to the global demand and for supporting transit facilities if those are allowed to neighbouring countries, Islam pointed out.

‘We must upgrade Chittagong port to face the global challenge in maritime trade,’ he said, adding that cargo traffic through Chittagong port marked a 15 per cent increase every year.

He also announced that the control room of Chittagong port would be made more functional and updated.

Asked about the recent incident of trapping of two port workers inside a Singapore bound empty container, the chairman said that an interim probe report on the incident had already reached the port authority.

‘But we need to get more details on the incident after the return of the worker found alive in Singapore… It [the incident] called to question our security system,’ he said.

Call centre: the sky is the limit

Business Life
Call centre: the sky is the limit

Employees are at work in a call centre in Dhaka recently. The country is set to earn billions of dollars in foreign currency from the sector. Photo: Amran Hossain

Abdullah Mamun

The year 2007 opened a new door for Bangladesh, offering newer opportunities to earn foreign currency by employing young graduates at home.

Bangladesh Telecommunication Regulatory Commission (BTRC) introduced its call centre policy for the local investors. The regulator claimed it had found, in terms of salary and career success, the sky was the limit for IT professionals.

The BTRC took on a policy that would enable the country to earn billions of dollars from abroad. A number of entrepreneurs enthused over the issue and around 270 licences were given to the firms.

But the tricks of the trade were not known to many and less than a fourth of the licensees are in the market at present.

Securing one percent of the $600 billion market does not seem impossible for Bangladesh to achieve, insiders say. Avenues are still open — it just needs some initiatives and help from the government as well as the actors in the field. Bangladesh hopes to be the best offshore call centre across the globe.

Why Bangladesh?
In September 2010, British technology magazine Outsource reported on the opportunities of Bangladesh, saying, “The advantages of Bangladesh’s grabbing some of the global sourcing pie are obvious. In particular, the authorities have seen the call centre space as providing an excellent entry-point for Bangladesh into the global market, capitalising upon the country’s historic cultural and linguistic connections with the English-speaking world.”

“However, the government is aware that a good deal of education and incentivisation is required to bring the country into the headlights of organisations looking for a suitable low-cost outsourcing destination — education not just amongst Bangladeshis looking for work, but among organisations with work to place.”

The foremost claim of Bangladesh to qualify as the best place for offshore calls is low wages. Bangladesh has certainly more than 25 percent cost advantage over India. Moreover, Indian call centre operators will soon cease to enjoy its 15-year tax break.

The Philippines has already overtaken India in this sector. So Bangladesh too has a chance to chew its piece of the pie. The readymade garments sector in Bangladesh is taking advantage of low wages and booming day by day.

The same conditions apply to call centres. The universities, colleges and vocational institutions in Bangladesh are producing a large pool of English proficient graduates in all disciplines. A huge number of creative graduates are waiting for a job in the market, which makes the sector lucrative.

Moreover, the English accent of the Bangladeshi people is highly neutral, which gives Bangladesh more advantages compared to other nations in the region. Geo-strategically, the Bangladesh time, (+) 6 GMT, ensures a ‘follow the sun’ services for its global clients.

The business situation
Currently, it is not impressive at all. Some 60 institutions are working with more or less 5,000 agents. Compared to India or the Philippines, it may be even less than half of a large company’s accommodation.

As the licensing fee is only Tk 5,000, many enthusiasts had initially thought it was like setting up a ‘phone-fax’ shop in the alley. As per licence conditions, the BTRC cancelled most of the licences when nothing moved with the licensees through the first six months after the permits were issued.

Looking about and winning a contract from the western world is not an easy task, many found out. The competition is not at home, it is with the experienced world, the entrepreneurs realised. The international standards of services coupled with huge investments made the business tough for most. More or less 10 of the Bangladeshi entities are in profit till now.

Both in the domestic and international services, Bangladeshi call centres are obtaining work orders in voice services or the customer care type contracts. Voice services comprise even less than 10 percent in the business arena, while the main opportunities lie with back office, software development, virtual assistance, transcription or even financial assistance. So Bangladesh has not yet seen any of the more sophisticated work.

A comprehensive roadmap is urgently needed to get the call centres flourished. A target should be fixed as to what Bangladesh would like to see in the next five to ten years. The sector has not been declared to date as an industry, which deprives investors of bank loans, while the return from the business is still slow.

According to call centre guidelines, domestic and international call centre service providers cannot operate from the same premises and systems. So an investment of taka one crore is useless either by day or night as it cannot operate around the clock. Basically, domestic services are performed during the day and the international ones by night.

The country also has no backup in international fibre optic cables. Customers in the western world turn their faces away when they hear that Bangladesh has no backup connectivity. Some time ago, a company tried to obtain work by installing a V-sat, which was to be connected via satellite. But it proved too expensive for the amount of business to be achieved.

It is applaudable that the government took the initiative to be connected with five more cables. But at least one is needed immediately — either submarine or terrestrial — for the ICT industry, as well as the call centre providers, stakeholders say.

The western companies look for experienced call centres but the local industry is still at a nascent stage. It is only a three-year-old industry, still faltering in its steps.

Although the domestic call centre service providers are doing well, it is up to the country’s big financial institutions to now let the call centres provide them with back office problem solutions. Such experiences would be useful for the call centres when they try to secure international contracts.

An insufficient supply of English spoken employees, i.e. students, is a problem for this sector. The educational institutions should take proper steps to groom their students in spoken English, like in India or the Philippines. Call centre operators should train and groom the new employees for up to six months.

Women workers are valued as assets in the call centres. But society is yet to permit girls to work at night or return home late at night due to social taboos and security concerns. Mass awareness campaigns are a must to address this.

Also, marketing in the global arena needs to be addressed. Frequent international exposures are needed to let people know about the country’s presence in the market. Taking part in global expositions to attract new customers is also a must.

Jute goods win back shine

Districts in Focus
Jute goods win back shine

Jute goods are on display at a shop in Rangpur. Manufacturers now download catalogues of jute goods from websites, choose designs and produce various goods of choice. Photo: Rafique SarkerRafique Sarker, Rangpur

A rise in demand for jute products, mainly handicraft goods, has made small enterprises of the north enthusiastic and hopeful to go ahead despite setbacks.

At least 150 enterprises in Rangpur division are now producing jute goods such as mats, travel bags, vanity bags, wallets, sandals, pen-stands, wall mats, curtains and various kinds of showpieces, as per the data of various commercial banks and Bangladesh Small and Cottage Industries Corporation (BSCIC).

Some of them have opened showrooms at the district and divisional headquarters to display and sell their products. Majority of the enterprises produce jute goods at their own factories and supply them to Dhaka and other parts around the country.

Some enterprises are served by homemade jute goods of their contracted craftsmen.

“Though marginal, we are running our business profitably,” said Masuduzzaman Tuheen, director of Begum Rokeya Craft at Payerabandh under Mithapukur upazila in Rangpur.

The jute goods’ demand has risen in the country for several reasons, Tuheen said. First of all, the craftsmen can procure jute as raw materials for jute goods easily as it grows in abundance in the region, he said.

Tuheen added, information technology, mainly the internet, has opened up many opportunities for them to get elegant designs from various handicraft sites. “We can produce very fashionable jute goods now but that was not possible in the past. It is because of our access to the internet in the rural areas.”

“We download catalogues of jute goods from international websites, choose designs freely from them and produce various goods of choice.”

“The craft workers made this possible as they are much skilled now,” said Zamal Uddin, a BSCIC engineer.

A number of government and non-government organisations, including Bangladesh Rural Development Board (BRDB), BSCIC, Jute Diversification Promotion Centre (JDPC), Palli Karma Sahayak Foundation, RDRS Bangladesh and CARE Bangladesh, have been organising trainings for the craftsmen on producing jute goods for years.

About 25,000 female workers in five northern districts have so far been trained up in making and dealing in various jute goods.

JDPC has been trying to establish linkages with marketing. The centre was set up in 2002 in Rangpur to promote jute products.

“We are acting as a bridge between the commercial buyers and enterprisers to share business information,” said Saher Hossain, regional marketing officer of JDPC.

Tuheen said many of the famous handicraft companies in Dhaka purchase jute products from them. But they sell the products with their own trade name in their company showrooms in the capital, he added.

When asked, Tuheen declined to disclose the names of such companies as the buyers requested them not to do so. He said some enterprises of the north display and sell their jute goods at different fairs across the country.

Anwar Hossain, proprietor of Beauty Satranji Factory at Mongla Kutti village under Pirgachha upazila in Rangpur, said he took part in almost all the handicraft fairs and exhibitions across the country.

“I took part in the Baishakhi Fair at Bangla Academy in Dhaka that concluded yesterday. I sold satranji (jute made multi-coloured mats) worth of about Tk 2 lakh. Usually I travel throughout the country and sell jute products,” Anwar said.

“Fifty craftsmen are working in my factory who had previously taken part in trainings at JDPC in Rangpur,” said Mosharraf Hossain, director of Sonar Bangla Handicraft in Rangpur.

Each of them earns around Tk 7,000 to Tk 8,000 a month by producing jute goods, Hossain added.

Hossain said Bangladeshi jute goods have its demand not only in the domestic markets but also in foreign markets. He said he had got an order to supply jute bags for HP laptops in China. He took part in the bid through internet and got the order.

Unicol Solution, a buying house in Dhaka, purchases jute-made satranji, mobile bags, vanity bags, and shopping bags from him for a Japanese buyer, he added.

Hossain said he has a showroom in Rangpur and he plans to establish another soon.

7 special economic zones under way

7 special economic zones under way
The government says SEZs will promote investment
Jasim Uddin Sarker

The government will set up seven special economic zones in seven divisions and at least three of the SEZs will get into operation by this year, finance ministry officials said.

The main objective to develop the SEZs is to boost local as well as foreign investment, they said.

‘The government has decided to allocate funds in the next budget for setting up the special economic zones in seven divisions of the country. ‘The size of the fund is yet to be decided,’ a senior official of the finance ministry told New Age on Tuesday.

In the first phase, priority will be given to develop three SEZs in Sylhet, Feni and Khulna.

According to the plan, product-based special economic zones will be set up by prioritising the region on the basis of prospects of production and availability of raw materials.

‘The government is looking forward to initiate economic zones very soon as the country needs them to promote investment,’ finance minister AMA Muhith told reporters at NEC conference room on Monday.

He mentioned that the government will implement the decision within December this year. It may take time to get them fully operational simultaneously in all the divisions, he added.

Bangladesh Economic Zone Bill 2010 was passed by the parliament on July 20, 2010.

According to the bill, there will be four types of economic zones — economic zone for local or foreign nationals, private economic zone for local or expatriate Bangladeshis or foreigners, government economic zones and specialised economic zones for specialized industries with private or public-private partnership or government initiative.

Plastic bag emerges as a new export product

Plastic bag emerges as a new export product
Doulot Akter Mala

The woven plastic bag has emerged as a fast-growing new export product, fetching a sizeable amount of export earnings and helping to diversify the country’s export basket.

Recently, the product has gained a wide popularity across the world for its durability, hygienic quality and reasonable price.

A number of local industries have invested billions of takas for production of the bag after they found its vast export potential.

As many as 60 industries have grown up in the last five years with an estimated investment of Tk 15 billion that are making woven sacks for local use as well as for the export market, industry insiders said.

“In the last two months, we have received orders for 4.0 million pieces of sacks from Indian business conglomerate, Birla, and Lafarge cement companies,” said first Vice-President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), Mr Jashim Uddin.

Mr Jashim, who is the owner of the country’s largest plastic goods industry Bengal Plastic, said the bag is available at a reasonable price and it is also suitable for carrying food grains.

The bag is widely used for carrying cement, fertiliser, rice and other food grains, he said.

Mr. Jashim is also the former president of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA).

The woven plastic sack comprises 50 per cent of the Tk 7.0 billion direct export earning from plastic goods, he said.

BPGMEA President Mr. Shahedul Islam said the woven sack is a successful example of export diversification.

It has gained tremendous popularity both at home and abroad, he said.

The plastic bag is considered a threat to jute promotion but due to its cheaper price it has become more acceptable to the users than jute bag, he added.

Mr Jashim said the government is preparing a law to discourage use of plastic bags and encourage use of jute bags.

“I am not against the jute promotion initiatives. Jute can be used for different other products, not only for bags,” he said.

A woven plastic sack is available at Tk 12 while a jute bag of the same size costs Tk 70-80, he said.

Referring to a discussion at a recent meeting on encouraging use of jute bags for fertiliser distributed by Bangladesh Chemical Industries Corporation (BCIC), Mr. Jashim said the government found that it would have to provide Tk 3.0 billion as subsidies to introduce jute bags, instead of plastic ones.

Prices of food grains will also jump if jute bags are used and this will cause an additional pressure on consumers who are already hit hard by spiralling prices of essentials, he said.

He said the government should sit with the businesses for fixing policies relating to uses of jute, instead of that of plastic.