Category Archives: Emerging Industries

Prospect of medicine export to CIS countries bright

Prospect of medicine export to CIS countries bright


There is bright prospect of export of standard quality medicines produced in Bangladesh to CIS countries including Uzbekistan and Kazakhstan. Both the countries import 90 per cent of medicines from abroad. Besides, there is also immense potentialities to set up joint venture pharmaceutical industries between Bangladesh and the two CIS countries.

This was revealed following a visit to both the countries by as delegation of Bangladesh Association of Pharmaceutical Industries (BAPI) led by its adviser SM Shafiuzzaman from June 28 to July 6.

During the visit, the delegation observed that the government should expedite diplomatic activities with the Commonwealth of Independent States (CIS) countries, which achieved independence after breaking apart of the former Soviet Union.

The delegation also was of the view that pharmaceutical products of Bangladesh worth over Tk 100 crore could be exported to the CIS countries in future with proper diplomatic efforts, enhancement of competent manpower in Bangladesh’s embassies and in CIS countries where there was no representation of the country.

The objective of the visit of Bangladesh pharmaceutical delegation to the CIS countries was to explore and expand markets of medicines produced in the country abroad.

During its visit, the Bangladesh delegation held talks with Health Minister of Uzbekistan Prof A Ikramov and high officials of his ministry. It was apprised of the health minister that presently Bangladesh exports medicine of international standard to 72 countries.

At the talks, the Uzbek Health Minister showed keen interest to import medicine produced in Bangladesh within the shortest possible time and setting up of joint-venture medicine producing industries with Bangladesh.

In this regard, a memorandum of understanding (MOU) was signed between Uzbek State-Joint-Stock Concern-Uzpharmsanoat and BAPI.

Later, the Bangladesh pharmaceutical delegation had talks with vice-chairman of the committee on health and medicine affairs of health ministry of Kazaksthan and other high officials.

The delegation apprised of the Kazakh officials in details about the pharmaceutical industry of Bangladesh. Besides, the delegation had separate rounds of fruitful talks with Pharmaceutical Importers Association and Manufacturers Association and large-scale importers of both the countries.

A number of Memoranda of Understanding (MOU) also were signed between different pharmaceutical companies of the country and established importing companies of both the countries.

Bangladesh Ambassador in Tashkent Hasib Aziz extended all sorts of cooperation to the Bangladesh delegation during the visit.

BAPI secretary general and managing director of Incepta Pharmaceuticals Ltd Abdul Muktadir, vice-president and managing director Medimet Pharmaceuticals Ltd Khondokar Tariq-ul-Islam, director of the drug administration directorate Md Ismail Hossain, director (planning and commercial) of Incepta Pharmaceuticals Ltd Ms Akhter Jahan Hasnin Muktadir, BAPI executive committee member and managing director of Edruc Ltd Feroz Uddin Khan, BAPI executive committee member and executive director of Healthcare Pharmaceuticals Ltd Md Halimuzzaman, BAPI member and director (marketing) of Biopharma Laboratories Ltd Dr Liaquat Ullah and business development manager Md Sami Akhter and director of the Export Promotion Bureau Omar Faruque were the other members of the Bangladesh pharmaceutical delegation, according to a press release of BAPI.

Eskayef enters UK medicine market

Eskayef enters UK medicine market
Sayeda Akter

Eskayef Bangladesh Ltd, a leading pharmaceutical company in the country, has started exporting medicines to a UK firm from this month, the company’s managing director said.

“Initially, we have got an export order of Diuretics and Omeprazole worth around $3 million from the UK drug company and we have sent our first consignment to that country on Monday,” said AM Faruque, adding that his company would complete the export by September.

“We have got approval from the Medicines and Healthcare products Regulatory Agency (MHRA) of UK in August 2008, which allows us to export pharmaceutical products to the European market,” he said.

Faruque said this agency usually takes a long time, even years, to give such a go-ahead, but Eskayef has achieved it in only eight months because the company complies with the MHRA requirements, including quality assessment and hygiene maintenance.

“In addition, with this order we have been allowed to export non-sterile production of tablets, capsules and granules (commonly known as pellets), which would help us grow further, both locally and globally,” he went on.

He said his company eyes raising exports to $5 million in 2009 from $3 million a year ago.

The world-class healthcare solution provider grows at 30 percent a year. The Eskayef MD also believes that the market will grow nearly 15 percent in 2009.

Eskayef manufactures and markets a wide range of therapeutic drugs, bulk pellets and animal health and nutrition products. Its 2008 sales reached $60 million, while the figure was only half a million US dollars in 1990, the year Transcom Group took over the company.

“We have set a target to sell drugs worth Tk 400 crore this year,” the Eskayef top official said.

The countries where Eskayef bulk pellets and finished products are now exported include Indonesia, Sri Lanka, Myanmar, Nepal, Vietnam, Kenya and some Central American countries.

AM Faruque in this context also pointed to his company’s constant efforts to ensure quality medicines for consumers at affordable prices.

There are 250 small, medium and large local and multinational pharmaceutical companies in operation in Bangladesh. Many started their business after 2000 sensing the growth potential in the local market.

Of the 250, top 10 companies, such as Square, Beximco, Eskayef, Incepta, Acme, ACI, Opsonin, Renata, Aristopharma and Drug International take up nearly 70 percent of the total market share, according to the Information on Medical Statistics (IMS) 2008 survey.

Local company floats coastal ship in Barisal

Local company floats coastal ship in Barisal

Khulna-based Prime Shipping Lines made Sundarban-4, a 1,500-tonne vessel, which was launched at a function in Barisal recently. Some other companies in the region are also making such ships riding on low-cost but skilled manpower and infrastructure facilities. Photo: STAR

Khulna-based Prime Shipping Lines made Sundarban-4, a 1,500-tonne vessel, which was launched at a function in Barisal recently. Some other companies in the region are also making such ships riding on low-cost but skilled manpower and infrastructure facilities. Photo: STAR

Rafiqul Islam, Barisal

Khulna-based Prime Shipping Lines, an associate of Sundarban Navigation Company, has entered the local shipbuilding market with completing construction of a coastal ship to be used for carrying goods in coastal areas of the country.

Sundarban-4, the 1500-tonne vessel, was floated on June 26 at a function in Barisal.

Shawkat Hossain Hiron, Barisal City Corporation (BCC) mayor, said at the function that the government has attached top priority to shipbuilding sector considering its enormous potential.

The government believes in the public-private synchronisation to expand the industrial sector by upgrading infrastructure facilities, said the BCC mayor.

Saidur Rahman, managing director of the company, said they can build ships with capacity of 500 tonnes to 2,500 tonnes in their shipyard situated in Beltala area of the city on the west bank of Kirtonkhola river.

Recently another local company Crescent Navigation also started constructing this type of vessels and more companies are coming forward, with low-cost labour, infrastructural facilities and local technology helping flourish the sector.

Golam Mawla, owner of Crescent Navigation, said Barisal region has a very old tradition in shipbuilding from ancient period.

Most of the large double- and triple-decker luxury passenger carrying water vessels now plying on major river routes of the country were built here by maintaining international standards,” Mawla said.

Md Ebaydul Haque Chand, director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said Barisal has a competitive edge over its rivals because of its cheap and naturally expert workforce.

He called for all-out support by making new policies and bringing changes to the existing laws to accelerate development of the sector.

The emerging shipbuilding industry is important not only for earning revenue but also for technology transfer, he added.

All it requires are modern technology and skilled manpower to meet the increasing demand for water transport vessels, Chand said.

“We have skilled and hard working people. We are hopeful that we will be able to achieve excellence in building larger ships in the coming days,” said Manzurul Alam Ferdous, owner of Kirtonkhola Navigation Company.

Cost competitiveness, technical know-how, skilled manpower and excellent communication skills of Bangladeshi shipbuilders helped in getting orders, industry stakeholders said.

Industry people said Bangladesh is enjoying the benefit of skilled workforce in building ships as some workers, who have work experience in different foreign countries, have come back home and joined the local industry.

Meanwhile, Export Promotion Bureau has recommended giving priority to the shipbuilding industry in the upcoming three-year import policy.

It also suggested bringing down bank interest rate to eight percent and simplifing the import procedures of raw materials for the shipbuilding industry, said Sheikh Abdur Rahim, president of Barisal Chamber of Commerce and Industry.

Local ceramics maker rides out global recession

Local ceramics maker rides out global recession

FARR Ceramics now eyes capacity building

FARR Ceramics that bags a 10 percent share in Bangladeshi ceramics exports is among the few now showing resilience against global recession. Photo: Farr Ceramics

FARR Ceramics that bags a 10 percent share in Bangladeshi ceramics exports is among the few now showing resilience against global recession. Photo: Farr Ceramics

Sajjadur Rahman

A local ceramics maker, in a span of less than two and a half years, has touched a credit mark of fetching around Tk 31crore from porcelain tableware exports in the immediate past fiscal year (2008-09), riding out the ongoing global recession.

FARR Ceramics Ltd, which has now a 10 percent market share in the Tk 300 crore exports of ceramics, went into commercial production in February 2007, exported nearly Tk 20 crore in FY 2007-08.

Despite a tremendous growth rate, Iftakher Uddin Farhad, the company’s chairman and managing director, believes Bangladesh has more scope than what it now exports.

“I am going to double my factory’s capacity soon to meet the growing export demand,” he said. “Quality and competitive price have helped us boost our exports.”

Bangladesh’s competitiveness enhances day by day. Farhad said rising energy and labour costs in competitor countries might turn Bangladesh into a global hub of ceramics tableware after China.

Ceramics and tiles are an emerging industry in Bangladesh. Some Tk 2,000 crore has been invested in the sector, both from home and abroad. Ceramics’s local market size was Tk 700 crore in FY 2008-09.

Bangladesh’s export earnings from ceramics reached $33 million last fiscal from a meagre amount of $1 million in 1991. Besides FARR, other major exporting companies are Shinepukur, Monno and Artisan Ceramics.

However, many local manufacturers and exporters could not remain immune from global crisis fallout, as exports have marked a decline.

During July-March in FY2008-09, ceramics exports declined to $25.60 million from $28.43 million in the same period a year earlier.

FARR is among the few companies that are showing resilience in the international export market. The company exports to Italy, Germany, Switzerland, Poland, Spain, Turkey and India.

“India is growingly becoming an important export destination for our tableware. We export on an average $70,000 ceramics to the neighbouring country a month,” Farhad pointed out.

FARR Euro Fine Porcelain, FARR Fine Ivory and FAAR High Alumina Porcelain are some of the company brands. Renowned five star hotels in India such as Marriott, Taj, Grand and Ramada use FARR ceramics tableware, the company’s MD claimed.

Higher energy and labour costs in China and Sri Lanka, the two major competitors, have paved the way for the company to cement its foothold in the global export market, Farhad said, lamenting government’s lax attitude towards the industry.

“Turkey is becoming a major importer of Bangladeshi ceramics, but the country requires a health certificate, which our testing institution BSTI is not giving to us,” Farhad said.

He said China gives 22.5 percent incentives to its ceramics exporters, but Bangladesh gives nothing.

FARR Ceramics Ltd was established in 2005 with Tk a 120 crore investment. Some 1,000 workers are employed in the factory.

Nasir Group plans to build pharma, fertiliser plants

Nasir Group plans to build pharma, fertiliser plants

The photo taken in February shows construction of Nasir Glassware and Tube Industries going on in Mirzapur. Nasir Group plans to build a pharmaceutical plant, a plastic material making unit and a fertiliser factory. Photo: Star/File

The photo taken in February shows construction of Nasir Glassware and Tube Industries going on in Mirzapur. Nasir Group plans to build a pharmaceutical plant, a plastic material making unit and a fertiliser factory. Photo: Star/File

Sajjadur Rahman

The diversified Nasir Group has decided to set up three new different types of industries to expand its business activities to a wide variety of areas.

The group, which is one of the largest family-owned business conglomerates in the country, will set up a pharmaceutical plant, a BOPP (plastic material) making unit and a fertiliser factory soon to gear up its businesses.

“We are going fast with the pharmaceutical factory,” said Nasiruddin Biswas, managing director of Nasir Group.

“We are trying our best to buy an existing licence to save time to set up the pharmaceutical plant,” he told The Daily Star recently.

Pharmaceutical is an emerging and prospective industry in Bangladesh. Currently, there are around 250 pharmaceutical companies that meet almost all the domestic demands. The top 10 companies’ market share is nearly 70 percent of the Tk 5,000 crore local market.

The group is also working with BOPP, which is a plastic material used in almost all types of packets. The BOPP plant will be the first of its kind in Bangladesh.

“We are talking to the suppliers of machines for the BOPP factory,” the managing director said.

He said Bangladesh imports BOPP products worth several hundreds crore taka each year.

The third project that the group is actively considering is a SoP (Sulphate of Potash) fertiliser factory. The government imports SoP and supplies it to the farmers at 60 percent subsidised price.

“We want to set up a SoP fertiliser factory. But we need to talk to the government on price fixation before undertaking the project,” said Biswas. SoP fertiliser is also used in tobacco cultivation to increase thickness of its leaf.

He said SoP helps ensure high quality, size, colour and high yield of crops.

Nasir Group, which started its business in a very small way with biri (traditional hand-made low-cost cigarette) making, now boasts of owning state of the art glass, melamine, printing and packaging, and footwear industries.

The group is now setting up a Tk 600 crore import substitute glassware and tube industry, which will be the first of its kind in the country.

Nasir Group’s annual turnover now hovers around Tk 2,000 crore. It pays on an average monthly Tk 13 crore value added tax to the national exchequer.

Of the three new plants, the group will set up pharmaceutical first, Biswas said.

His daughter who is a foreign-educated pharmacist will lead the pharmaceutical plant, he noted.

X-Ceramics to go for trial production by end of next month

X-Ceramics to go for trial production by end of next month

Mehdi Musharraf Bhuiyan

A homegrown real estate conglomerate is aiming to give country’s changing skyline a real shine by locally producing ceramic wall tiles which can be used not only in the buildings’ interior but also on the exterior.

From its state-of-the-art manufacturing plant in Sreepur of Gazipur, X-Ceramics Limited, a Tk 607.32 million project has embarked on a mega project of establishing, what has been termed as ‘the largest ceramic tiles manufacturing facility’ in Bangladesh.

“We are going for trial production by the end of August,” Managing Director of X-Ceramics Limited Mahin Mazher told FE recently in an interview. “To that end, major infrastructure work has already been completed while machinery installations are going on in full swing,” he added.

X-Ceramics is a concern of the decade-old Index group of companies.

“Our plant will produce porcelain and ceramic floor and wall tiles both for interior and exterior use, however production of exterior ceramic tiles will be unique in sense that it is for the first time that tiles made of ceramics intended for external use would be manufactured within the country,” Mahin said.

Although the use of ceramic tiles for the floor and on the interior wall of the building has become the norm in the country for a while now, use of the same on the building’s exterior is still a rare sight.

Mahin says that his company is aiming to tap into this vacuum, as there could be a huge demand for such exterior ceramic tiles in the local market because of their durable resistance against heat and humidity.

“One major benefits of using such exterior tiles are they never fade in the sunlight or in any extreme weather condition, something to which most of the buildings in our country are prone to,” Mahin said.

“In rare cases, various expensive stone types are used on the exterior as a possible way out but that is an expensive idea,” he said, adding, “rather than that, use of such exterior ceramics which could be offered at a competitive price, offers an affordable solution”.

“Apart from that, using the exterior tiles shall protect interior plaster and paints from outside water penetrations while enhancing the building’s look by many folds,” he added.

Index Companies; to which X Ceramics is a subsidiary, has a three decade long legacy of constructing or designing a number of architectural landmarks in the Dhaka city that now houses various top government offices or business houses.

Now, in addition to pioneering the use of exterior ceramics in the country’s booming housing sector, X-ceramics is also aiming to grab a lion’s share of the country’s overall market for ceramics wall and floor tiles.

“The market for ceramics floor and wall tiles in the country is an ever growing one, with the daily domestic output is estimated at one hundred thousand square meter which is worth of around Tk 35 million,” Mahin said.

“To begin with, we will have a daily production capacity of 10,000 square meter, but by the end of the year, it would be increased to 27,000 square meter per day, which would make us the single largest player in the market with 20 percent more output capacity than our nearest competitor and a market share of 25 percent,” he added.

The company received financial support worth Tk 350 million from six private banks. The banks are Prime Bank Limited, Islami Bank Bangladesh Limited, Export Import Bank of Bangladesh Limited, Social Islami Bank Limited, Southeast Bank Limited and Trust Bank Limited.

X Ceramics boss also says that sooner than later his company would go for the production of tableware like teapot and cups which is another ceramic byproduct with huge demand in the local market.

He informed further that currently his company is also looking to form partnership with an overseas entity (whose name he prefers not to mention) for further sharing of technological know how, to turn it into the ‘first ever European standard multinational joint venture ceramics manufacturing facility’ in Bangladesh.

RAK Pharma makes debut

RAK Pharma makes debut

FE Report

RAK Pharmaceuticals Private Limited- the drug-manufacturing arm of the global conglomerate RAK Group has tapped into the country’s booming pharmaceuticals market with the launching of its 13 brand new medicine products Friday.

The UAE-based corporate giant with a substantial presence in the local market for ceramic products, now emerges as the latest player to watch for in the country’s highly competitive pharmaceuticals sector.

The company formally unveiled its whole new range of medicine products through an official launching ceremony at a city hotel this weekend. Minister for Health and Family Planning A F M Ruhul Haque attended the occasion as the chief guest.

Unveiling the product; the health minister in his speech said that the present government is committed from the very beginning for the export facilitation of the local pharmaceuticals industry realizing the high growth potential of the sector.

He also asked the RAK Pharmaceuticals authority to explore international market for their products to turn it into an export-oriented venture.

Chairman of RAK Pharmaceuticals Private Limited Khatar Massad said that the company would extensively capitalize on its experience in pharmaceuticals sector in other countries to make a mark into the Bangladeshi market.

“In the near future, RAK would like to expand its operation into other growing segments in this country including real estate,” he added.

Chief Executive Officer of RAK Pharmaceuticals Private Limited (Bangladesh) A H M Zaker said the newborn company would soon launch 13 more medicine products to cater the local market.

“From our state-of-the-art manufacturing facility set up on 5.3 acre area at Sreepur of Gazipur and built at an expense of Tk. 800 million, we would go all-out to maintain the best quality in our manufactured product,” he added.

Adviser to the Bangladesh Association of Pharmaceuticals Industries Mizanur Rahman Sinha also spoke on the occasion.

Established in the 1980s in Ras Al Khaimah- one of the seven emirates of the UAE, the RAK Group is now one of the largest producers of ceramic products while its other concerns include pharmaceuticals, painting and porcelain.

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.

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.

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.