Category Archives: Engineering Sector/Steel and Metals Industry

Motorcycle assembling to be developed

Motorcycle assembling to be developed
Says minister
Unb, Dhaka

Leaders of the International Business Forum of Bangladesh (IBFB) yesterday put forward a set of recommendations for the development of motorcycle-assembling sector.

They sought tax rebate for importing raw materials used to manufacture spare parts for motorcycles, formation of a committee to monitor the procedures of raw materials import and tax holiday for manufacturing motorcycles.

The recommendations came when an IBFB delegation met Commerce Minister Faruk Khan at his office. IBFB President Mahmudul Islam Chowdhury led the six-member delegation.

The minister assured that all necessary steps would be taken for the development of motorcycle manufactures and its spare parts.

Streel Industry: Steady demands nourish robust growth

Steady demands nourish robust growth

The file photo shows workers busy at Bangladesh Steel Re-rolling Mills that produces high-grade steel.

The file photo shows workers busy at Bangladesh Steel Re-rolling Mills that produces high-grade steel.

Shakhawat Hossain

The country’s steel industry has been getting continuous investment boom due to steady demands.

Steel manufacturers see no major negative impact on their industry as they believe the country’s economy will keep its impressive growth despite the global financial recession.

They said the country with nearly six per cent growth in the last three years provides enough clues to consume higher production of mild steel rod to be generated by the big players with their proposed new investments.

‘The rod industry will not face major problem due to growing investment in the sector,’ said Bangladesh Steel Re-rolling Mills chairman Ali Hossain Akbar Ali.

‘Chance is slim even for the small players to become sick as the growing consumption rate of steel will remain in the coming years despite global financial recession,’ he told New Age.

BSRM, producer of high-grade steel, makes up more than 25 per cent of the total demand.

It is now on trial production in its newly installed 3,00,000-tonne plant, set up at a cost of over Tk 3.5 billion. It has also unveiled plans to invest another Tk 500 crore to raise its capacity to around one million tonnes within the next five years.

Following the footstep of the company, Kabir Steel and Re-rolling Mills is setting up a 3,00,000-tonne mild steel rod plant in Chittagong.

KSRM announcement came just a month after the country’s largest conglomerate, Abul Khayer Group, formally entered the sector, unveiling a Tk 700 crore investment for an 8,00,000-tonne plant.

Bashundhara Group, the realtor-turned-tissue to paper giant, also expressed its intention to set up an integrated steel plant.

Another Chittagong based mill — Ratanpur Steels and Re-rolling Mills — has said it has started marketing 75-grade mild steel rod since late last year from its Tk 200 crore state-of-the-art steel factory.

Trade experts and bankers, however, expressed concern that the latest investment boom in rod, a key construction component, will outpace the country’s annual demand for rod and might result in investment glut.

Dismissing such apprehension Akbar Ali said the country’s economic growth was good enough to consume the new and higher steel production that even raised no fear even for the existence of small players of the market.

He, however, foresees an intense competition in future due to possible price war which will eventually benefit the consumers.

Sheikh Masudul Alam, former general secretary of the Bangladesh Re-Rolling Mills Association, said he did not see any problem in new investment for the small players who were dominating the market with more than 70 per cent share.

‘The consumption of rod will be double in near future which will allow new investors sufficient breathing space,’ he said.

Sensing a fierce competition in the future rod market the small players are re-fixing their strategies. Many of them are adopting technology to produce high-grade rod, he added.

The country’s fast growing construction industry uses nearly 25 lakh tonnes of rods every year, the market price of which is Tk 1,000 crore.

More than 200 re-rolling and steel mills are producing steel products by using imported and locally available ship scraps. Only a few steel factories use imported billet to produce high quality mild steel rod.

Ananda to export its eighth ship

Ananda to export its eighth ship

The Stella Moon built by Ananda Shipbuilding, Bangladesh. Photo: STAR

The Stella Moon built by Ananda Shipbuilding, Bangladesh. Photo: STAR

Star Business Report

Ananda Shipyard and Slipways Ltd, one of the leading local shipbuilders, is going to sell its eighth ship to a Danish buyer at $7.5 million, marking an important milestone in the country’s emerging shipbuilding industry, said a senior official of the company yesterday.

Ananda will formally hand over the ‘Stella Moon’ to Denmark-based Stella Shipping P/S on Sunday at the company’s office at Meghnaghat in Narayanganj, said Managing Director of the company Afruja Bari at a press conference in the capital.

Afruja said Industries Minister Dilip Barua is expected to handover the ship to its buyer at a function at Meghnaghat as the chief guest.

Earlier Ananda exported its first ship Stella Maris to another Danish company at $6 million on May 5 last year and six others to the Mozambique government at $6.2 million on November 13, said the company officials.

Talking to The Daily Star, the officials of the company also said they are now building 10 ships of which six have been ordered by Komorowski and four others by Wessell, two German companies.

“We hope to deliver the ships within the next three years as the construction works are going on in full swing,” said a company official.

He said Ananda Shipyard is receiving a good number of orders from Denmark, China and Vietnam as they consider Bangladesh as a cost-effective destination for shipbuilding for its cheaper labour and lower production costs.

Afruja said Stella Moon has 64 TEUs (twenty-foot equivalent units) container carrying capacity with 2,950 deadweight tonnages.

Deadweight tonnage, also known as deadweight (DWT), is a measure of how much mass or weight of cargo or burden a ship can carry safely.

Afruja urged the government to give a 30 percent cash incentive to the shipbuilding industry, scrap the bank guarantee system for importing raw materials, exempt L/C (letter of credit) confirmation costs and give working loan as working capital at seven percent interest rate.

Bangladesh joins multipurpose ship exporters May 10

Bangladesh joins multipurpose ship exporters May 10

BSS, Dhaka

Bangladesh, for the first time, is going to join multipurpose ship exporting countries by handing over a ship named ‘Stella Moon’ to the Danish government on May 10.

Ananda Shipyard and Shipways Ltd (ASSL), one of the premier shipbuilding companies of the country, has built the Stella Moon at a cost of 7.5 million US dollar.

Speaking at a press conference, Afruza Bari, managing director of the ASSL said that Stella Moon is the eighth oceangoing ship to be exported to Denmark.

Chairman of the ASSL Dr Abdullahel Bari, director Naval architect engineer Tariqul Islam and engineer Nazma Nowroz responded to the queries raised by the journalists at Dhaka Reporters Unity (DRU) here.

He said, Industries Minister Dilip Barua will inaugurate the handing over ceremony as the chief guest on the premises of the shipyard at Meghnaghat under Sonargaon upazila in Narayanganj district.

Within a short span of time, he said, Bangladesh will be recognized as a destination of shipbuilding in South Asia encouraged by the government’s patronization of announcing green channel facility allowing the industry a priority sector.

As a result of the green channel facility, a number of companies have expressed their keen interest in investing in the sector, he said and expressed hope that the country can earn 20 billion US dollar annually if the government provide the shipbuilding sector with 30 percent cash incentive for next five years.

Referring to the Prime Minister’s recent call to the engineers to build dredger equipped with local technologies, Nazma Nowroz said the country could save huge amount of foreign currency if the country’s shipbuilding companies get the chance to build dredgers.

They demanded the government to allow bank guarantee at 1.5 percent rate like neighboring countries, reducing opening cost of letter of credit (L/C) and announcing working capital at seven percent interest rate.

The Stella Moon has the capacity of 3,000 dead weight tonnage (dwt) and some other ships being built containing up to 6,600 dwt, said Dr Bari.

Light engineering sector produces at least 50 pc substitutes of imported items

Light engineering sector produces at least 50 pc substitutes of imported items

Munima Sultana

Light engineering sector (LES) that draws the least attention of the policymakers, has emerged as a potential cost cutting sector by producing at least 50 per cent substitutes of imported items in the country.

This important sub-sector is now providing critical support to industrial, agricultural and construction sectors by manufacturing a wide range of spare parts, castings, moulds and dices, oil and gas pipeline fittings and light machinery, as well as repairing those.

Sector players claim that electrical goods like switch, socket, light shed, channel, cables and electrical fans, which are manufactured by the LES are now meeting 48 to 52 per cent of the country’s demands, which was earlier met through import.

Besides, the sector’s contribution to production, maintenance and repair of automobile spare parts is worth about US$ 75 million. Statistics show that the country spent US$ 2.3 billion in import of cars and another US$ 74 million in automobile spare parts in 2007-08 fiscal year.

In the agricultural sector, all the shallow tubewell spare parts like liner, diesel engines are now coming from the LES, which are located in rural areas of the country, they claimed.

Though having limited investment opportunity, some products of this sector have successfully turned into well-known brands like Al-Amin Fan, BRB cables and Sunflower cables, among others, they added.

According to official statistics, the market turnover of the sector was $ 2.1 billion in 2008 with an average estimated growth of 7 to 8 per cent. The earnings from this sector is $ 2.8 billion per annum.

According to Export Promotion Bureau, export earnings from this sector was $310 million during 2007-08, which was $285 million in 2006-07. Export growth was estimated at 30 per cent.

President of Bangladesh Engineering Industries Owners’ Association Abdur Razzak claimed the sector’s actual growth remained invisible due to lack of detailed study on this vital support sectors.

He termed light engineering sector as ‘the mother of all sectors,’ because it provides backup support to cement, paper, jute, textile, sugar, food processing, railway, shipping, garments capital machineries by repairing and maintaining those. The sectors growth rate was 10 per cent, he added.

A recent study conducted by International Finance Corporation (IFC) in partnership with UK Department for International Development and Norwegian government shows that LES has in its employment 600,000 people involved in 50,000 micro enterprises and 10,000 Small and Medium Enterprises.

Another study conducted by Bangladesh University of Engineering and Technology however, estimates that LES comprises of around 40,000 enterprises employing around 800,000 people.

Abdur Razzak said whatever growth was being projected in the sector it cannot be considered encouraging as it still stands on low capital and low investment climate scenario because of inadequate support from policy makers and financial institutions.

Sources said despite demands in the country, most products of light engineering sectors could not penetrate the market due to use of old machineries, lack of quality finish and inadequate manpower training.

The IFC-SEDF (South Asia Enterprise Development Facility) study shows that machineries including lathe, shaper, milling and drill used in different LES industries are on an average 23 years old.

At present, the country’s lone quality assurance authority BSTI (Bangladesh Standards and Testing Institution) lacks the capacity to standardise most of the LES products.

Recently, in an attempt to develop partnership between sectors, an agreement was signed between Singer and Al Amin Fans under which the latter would produce Singer brand fans.

Besides, meeting has also been held with other potential users including the REHAB to encourage sale of products coming from the sector.

‘Consumers opting for locally-made refrigerators’

‘Consumers opting for locally-made refrigerators’
Economic Reporter

RB Group, the first local company to start producing refrigerators and other electronic goods, offers refrigerators at 20-30 per cent reduced rates compared to other imported foreign refrigerators

Walton, a brand of RB Group, offers a 10-cft refrigerator at Tk. 20,700 while a similar size imported refrigerator is selling between Tk 30,000 and Tk 33,000, says a showroom manager of Walton at Bashundhara City.

The group recently launched commercial production of refrigerators at its manufacturing plant in Gazipur.

The plant of Walton Hitech Industries now produces about 0.60 million units of refrigerators against demand for 0.40 million units in the country. Company officials hope that the locally made refrigerators would be exported Thailand, South Korea and some African countries, including Sudan, from July as negotiations are on to sign the export deals.

Marcel, another brand of the company, also offer refrigerators at a similar price.

Rahimafrooz trebles industrial battery production as solar energy expands

Rahimafrooz trebles industrial battery production as solar energy expands

Mushir Ahmed

Renewable energy leader Rahimafrooz said it has trebled its industrial battery production to cater to a dramatic expansion in the country’s solar energy systems.

Niaz Rahim told the FE that they have relocated the factory to Savar this year and it would produce nearly one million industrial batteries a year.

He said they have ramped up production to cope with growing battery needs in the country’s renewable energy industry.

“All the solar energy providers buy batteries from us. As they are growing too fast, we had to expand our production to cope with this soaring demand,” he said.

The Group, which leads the automative battery industry in the region, also sells industrial battery for power stations and telecom industry and exports a chunk of it to neigjbouring countries.

The expansion came as the solar energy is witnessing a dramatic expansion after years of moribund growth.

The number of solar power users almost doubled in the country over the last 15 months to around 295,000 till March 31 this year, according to a government statistics.

Abser Kamal, general manager of Grameen Shakti, the leading solar energy provider, said the company now buys some 10,000-15,000 batteries a month from Rahimafrooz, up from a monthly 200 even four years back.

“The expansion in battery production would pave the way for speedy growth of the solar energy industry,” he said.

Rahimafrooz also sells some 2000 batteries a month of its sister charity, Rural Services Foundation, which is the third largest provider of solar energy in the country.

Set up in 2006, RSF has now installed some 30,000 solar household systems through a network of some 115 offices spread across rural Bangladesh.

This year the RSF has even overtaken leading charity Brac in terms of growth but still trails behind GS by a wide margin.

Ruhul Quddus, the chief of RSF, said the charity would add another 50,000 households this year and would set up another 400 offices by 2010.

All this has put Rahimafrooz at an ideal position to reap the benefit, despite the entry of half a dozen new battery producers.

“We are confident solar energy would be a billion dollar industry here very soon. Already we can see the signs after years of investing our time and energy to open up people’s eyes,” said Rahim.

The company has also set up a $25 million factory in Iswardi Export Processing Zone. Rahimafrooz Globatt would produce 2.5 million batteries when it goes into production within weeks.

Bashundhara Group to set up Tk 25b integrated steel plant

Bashundhara Group to set up Tk 25b integrated steel plant

Jasim Uddin Haroon

A local company Tuesday disclosed that it will set up the country’s first ever integrated steel plant at a cost of around Tk 25 billion to cater to the domestic demand for steel products.

The Bashundhara Group said it will produce steel products from the proposed integrated plant by using the basic raw material- iron ore.

Currently, over 200 re-rolling and steel mills in the country are producing steel products by using imported and locally available ship scraps. Only a few steel factories use imported billet to produce high quality mild steel rod.

“We have taken up the project of an integrated steel plant as the steel products produced in it would be cheaper and of international standard,” Serazul Islam, chief coordinator of Bashundhara Basic Integrated Steels said.

He also said the proposed plant will produce initially 1.0 million tonnes of steel products a year with an option of future expansion.

Bashudhara officials said they will start the civil works for the plant shortly at Anowara in Chittagong. The plant will be set on 300 acres of lands.

The project coordinator said Bashundhara will seek international financing for the project besides local commercial banks.

Bashundhara officials said they will produce different kinds of steel products to be used in structural engineering applications, maritime purposes, automobiles and general industrial purposes.

Md Jahangir Alam, a tremor expert, told the FE: “The quality of steel depends on its raw materials. Steels produced by iron ores are much more qualitative than the other steel products.”

“The demand for steel product produced from ores is rising in rich nations. Even, neighbouring India is also using this kind of steel,” Jahangir added.

Bangladesh’s steel market is estimated to be about 2.0 million tonnes a year.

Recession opens scope for light engineering

Recession opens scope for light engineering

Khawaza Main Uddin

Bangladeshi entrepreneurs can ‘easily’ take joint-venture initiatives for relocation of hundreds of light engineering units from developing Asian countries facing the pinch of the global recession if the government properly supports the sector.

Terming the global financial crisis an opportunity for Bangladesh, a leader of the light engineering sector has insisted that the government should provide them with designated area for setting up a cluster of industries to house both local and joint venture units, instead of doling out lump sum bleeding the national exchequer.

At a time when many experts are talking about inward-looking development to evade risks in export market, small-scale formal and informal workshops at different parts of the city and other parts of the country have shown skill and innovative capacity to cater to the needs of accessories of various industries and households in the country.

‘We will get a maximum of two years to import at through-away prices machinery of many units now being closed under the impact of the financial meltdown. What we need is an industrial park which can substitute imports of light engineering products worth Tk 20,000 crore annually,’ Abdur Razzak, president of Bangladesh Engineering Industries Owners Association, told New Age.

He pointed out that the Bangladesh government could invite them to set up industries based on hundred per cent foreign direct investments or encourage the local private sector to take joint venture initiatives. ‘We can import the machines useful for light engineering almost at throw-away prices. This is a golden opportunity,’ Razzak added.

Asked about the opportunity of grasping the potentials of such relocation, the president of Dhaka Chamber of Commerce and Industry, Zafar Osman, explained that the government would have to build necessary infrastructures within quickest possible time to use any potentials including attracting FDI. ‘If the government can give a signal that it has taken proper initiative to build the infrastructures and they would be completed in one year or two years of time, the entrepreneurs will act on such signals to take ventures,’ he said.

Hundreds of industrial units in countries like Taiwan, South Korea and Malaysia are being forced to close down following fall in the demand of their products in the Western market, he said referring to his own experience of visiting those countries recently.

He felt that the government could allocate special funds in the next budget to support the light engineering sector, alongside similar other sectors, to ensure effective utilisation of public money at this time of economic recession. ‘We don’t want cash incentive. I think the taxpayers’ money should be utilised in productive investments,’ said Razzak, a former director of the Federation of Bangladesh Chambers of Commerce and Industry.

The country’s light engineering sector, which involves an annual trade turnover of around Tk 1,500 crore, has already been ‘facing recession internally in absence of policy focus and patronisation from the state’, he said adding that light engineering enterprises has burgeoned in scattered manner due to demands of diverse products in spite of different barriers to growth.

According to the Board of Investment data, the country has about 40,000 small-scale light engineering enterprises spread over the country and the industry manufactures about 10,000 types of items for the local industry.

The entrepreneur believes the government can promote industry, create employment and generate higher domestic demand by focussing on the small and medium enterprises of light engineering units due comparatively lower requirement of capital and technology.

SME [small and medium enterprises] Foundation can be used as a platform for coordinating a cluster of industrial parks for enterprises of different sizes, sectors and floating accessible public sector funds at reasonable interest rates, recommends Razzak, who has been active for more than a decade in this sector.

The light engineering association has chosen Keraniganj as a suitable place for development of cluster of industrial parks on khas land and the one to be allotted by the government. ‘We can purchase land if the government arranges and it will take not more than one year for a unit to go into operation,’ he said.

The association leader proposed that the government could make necessary arrangements for promoting job-oriented small and medium enterprises in the light of the ‘policies and practices’ in neighbouring India and Pakistan.

He pointed out that the light engineering products were understandably immune from duty in accessing markets of developed countries including the Untied States.

Bangladesh exports light engineering products including bicycle worth over $300 million, which the business leader termed meagre in view of the potentials of exports even after import substitution.

EPZ venture targets vehicle exports

EPZ venture targets vehicle exports

The internet photo shows a refurbished Volvo bus run by a UK company on long route. The 3G Engineering will producing similar types of vehicles for exports.

The internet photo shows a refurbished Volvo bus run by a UK company on long route. The 3G Engineering will producing similar types of vehicles for exports.

Shakhawat Hossain

It may sound highly ambitious, but a local company has started implementing a project, targeting vehicles export.

Unlike imported ones, the plant will produce and export only refurbished vehicles that have a good overseas market.

A 35-year old Bangladesh-born British citizen, Abdul Jahan, has initiated the plant at Mongla Export Processing Zone under the name of a company — 3G Engineering Limited.

The plant with an investment of over $11 million will refurbish 400 units of vehicles in the initial years as per the agreement with the Bangladesh Export Processing Zones Authority, said Jahan.

The company is expected to go on production by July, said its manager Shaylen Mondal.

He said they would import old vehicles like Volvo, Mercedes Benz, BMW and Land Rover mainly from Europe to refurbish those.

The refurbished vehicles have strong demand in countries like South Africa, Ghana and Nigeria as they cost one-thirds of the prices of new ones.

The company will hire 10 automobile engineers from England and also create employment opportunity for 206 Bangladeshis in the initial years.

The number will go up with the progress of the plant.

‘This is the most interesting projects in recent years as it will help the country to produce skilled workforce,’ said Bangladesh Export Processing Zones Authority member (investment promotion) Prasanta Bhushan Barua.

‘We don’t have any practical knowledge about the refurbished consumers’ items like vehicles, refrigerators, air coolers and computers,’ he said.

The refurbishing automobile plant in Mongla export processing zone is not just a money-making project, said Jahan when detailing the background of his plant.

‘It is a long-cherished dream to set up a trail-blazing venture to create a lasting desire among the soul searching new generation of Bangladesh-origin UK citizens,’ he said.

Jahan said the third generation Bangladeshis, born and grown up in English atmosphere, are not much aware of Bangladesh and her long struggle for independence and economic emancipation.

However, the generation has many experts who can contribute to the development of Bangladesh, he said and added that the number of such experts in different fields was increasing in many suburbs in the UK, including Brick Lane, Tower Hamlets, Camden, Westminster and Newham.

The growing new generation is taking refuge to the English culture, but it has a passionate group with immense potential of contributing to the development of Bangladesh through technology transfer, he said.

Jahan believes that the 3G Engineering project will show the much needed paths to many Bangladeshi-origin British citizens who search their roots often.

‘I can invest and make money anywhere in the world, but I have decided to invest in Bangladesh,’ said Jahan who is a successful third generation businessman in traditional restaurant business in the UK and an automobile expert.

The existing 3G engineering limited is a successor of JSL that was formed in 2000 by the same man. The company teamed up with the Sena Kalyan Sangstha, a welfare organisation under the Armed Forces, to market European luxury vehicles like BMW and Volvo. The project was not successful.

The unsuccessful venture did not put break on the endeavour of Jahan, who mixed emotion with his imagination to translate his dream into reality.

Biogas engine generator developed

Biogas engine generator developed

FE Report

Electric generators powered by biogas fuel which is processed from animal and poultry waste, is gradually gaining ground in the cattle and poultry farms in Bangladesh.

To reduce the dependency on electricity in a country where the average difference between national demand and supply ranges between 1,000 to 1,500 megawatts, innovators have come up with a system which can generate electricity from animal wastes., i.e. poultry litter and cow-dung.

The biogas engine generator which costs Tk 400,000 to generate 10 kilowatt of electricity uses biogas, an output of organic wastes.

A team led by Sustainable Energy for Development (SED), a project of German Technical Cooperation (GTZ), Senior Adviser Dr Engineer Khursheed-Ul-Islam has developed the 100 per cent biogas engine generator by using locally-produced biogas, air-mixed carburetor, retrofit to reduce hydrogen sulfide and water.

Electricity has been generated in small and medium scale sectors with a mixture of 30 per cent of diesel and 70 per cent of biogas which is not cost-effective because of high price of diesel, Khursheed-Ul-Islam said.

The team led by him developed the system that requires no diesel to produce biogas which can generate electricity. German Technical Cooperation (GTZ) provided technical assistance and initial financial assistance worth Tk 200,000.

The German development agency-supported project started on experimental basis to generate electricity from wastes-produced biogas at private-owned Raj Poultry Limited in Faridpur in early 2007, which continued without any problem for next two years.

Being inspired by the success, Advance Animal Science Company Limited has now made a commercial investment with a total of 20 kilowatt electricity generation system at its dairy and poultry farm located respectively in Latifpur and Sardaganj under Gazipur district, on the outskirts of the capital.

Officials said now the power generation system has become user-friendly and safe for the engine-generators. Above all, it has a zero fuel cost which is operable with biogas only.

This is techno-economically viable and commercially quite attractive. This can replace the nearest alternative to grid diesel-fuelled operation, they added.

Khursheed-Ul-Islam Saturday told reporters that the country’s 150,000 poultry farms and 25,000 dairy farms produce adequate animal waste such as litters and cow-dung to commercially generate biogas.

“Every commercial poultry or dairy site can generate 6 to 700 cubic meter biogas by using the organic waste which can be used for cooking and generating electricity. Moreover, the available waste can produce high-powered biofertiliser.”

Local company manufacturing cheap refrigerators

Local producer offers cheaper whiteware
United News of Bangladesh . Dhaka

RB Group, a local refrigerator-manufacturing company, has offered its products at 20-30 per cent reduced rates compared to other imported foreign refrigerators.

‘The rate RB Group has offered is cheaper compared to any other refrigerators available on the market…’ said RB Group deputy director Mainul Haque.

He said RB Group had been maintaining a world-class standard as it exports its products to the world market as well.

RB Group has recently launched the commercial production of refrigerators at its large manufacturing plant in Gazipur.

The plant – Walton Hi-tech Industries – now produces about 6 lakh units of refrigerators against a demand for 4 lakh units across the country. About 2,500 workers are working in the plant, set up on 20 acres of land to meet the local demand and export abroad.

Company officials hope the Bangladeshi-made Walton refrigerators will go to Thailand, South Korea and some other African countries, including Sudan, from July next, as negotiations are on to make the export deals.

RB Group’s assistant director Mizanur Rahman said his group had been the first local company which started producing refrigerators and some other electronic goods.

‘We’re also producing motorcycles to meet the local demand.’

He claimed that Walton offered a 10-CFT refrigerator at Tk 20,700 while a similar size imported refrigerator is selling at between Tk 30,000 and 33,000.

‘We can offer a cheaper rate as our production cost is much lower because of some advantages… We’ve got cheaper labourers which has made it possible,’ he added.

Presently, Walton is marketing 12 models of refrigerators by its 600 exclusive outlets and also by vendors throughout the country.

Another seven models will come into the market next months. Each of the Walton outlets also provides service facilities to the customers.

Bogra seizes Indian market for irrigation equipment

Bogra seizes Indian market for irrigation equipment

The picture shows centrifugal pumps made in Bogra. The district found India as a popular destination for exports of the irrigation equipment.Photo: STAR

The picture shows centrifugal pumps made in Bogra. The district found India as a popular destination for exports of the irrigation equipment. Photo: STAR

Hasibur Rahman Bilu, Bogra

Centrifugal pump exports from Bogra are gaining popularity, as the sector provides irrigation equipment at competitive prices.

India has placed orders for 20,000 pieces of centrifugal pumps for the item’s export by December, according to the industry people.

“There is ample scope for the export of centrifugal pumps and other iron products to India, China and some other countries. However, we are not able to make products in quantities as per demand for now. Because we have some limitations, such as absence of running capital, modern equipment and government support,” said Ainul Haque Shohel, the president of Bangladesh Foundry Owners Association.

The trade body’s secretary, Abdul Malek, complained, “Following the media coverage, the government has reduced taxes from 15 percent to 7 percent for the sector. But the foundry and light engineering workshop owners have to bear additional taxes. VAT and other sources of government revenue from this sector is much higher, in comparison with India.”

The government should withdraw the VAT from the foundry sector to help the light engineering sector flourish and encourage the export of agro based equipment, he suggested.

Centrifugal pumps are exported to India at $18 to $20 per unit, whereas the same product in India is being sold at $88 each, according to Shohel.

According to a survey by the industries ministry, the Bogra based foundry and light engineering workshops meet 90 percent of the local demand for agricultural equipment.

The sector is now providing metal equipment for the garments, transport, textile, jute and other sectors, reducing import dependency, Malek said.

Azizur Rahman Milton, owner of Milton Engineering, said demand for centrifugal pumps has increased because of better quality and lower price of the products.

The industry sprang up about 24 years ago in the district of Bogra, which primarily produced pans and other iron made equipment.

The total turnover of the industry is now Tk 400 crore a year.

Generators take local root

Generators take local root

Sales of generators rise as outages hit the country. Local businesses are being involved in assembling and making parts of the power devices.Photo: STAR

Sales of generators rise as outages hit the country. Local businesses are being involved in assembling and making parts of the power devices. Photo: STAR

Sayeda Akter

Sales of generators are rising on frequent outages and an electricity shortage in the country with local businesses increasingly getting involved in assembling and making parts of the power devices amid approaching summer.

In the last three months, around 11,000 units of generator were sold mainly in Dhaka and Chittagong, marking a rise of 25 percent compared to the previous year, said industry people.

This year traders predict that a strong sales trend will continue for several more months as industries, corporate houses and shopping malls are not seeing any immediate respite from the power crisis. So they are getting ready to invest sizable amounts in the business.

Although earlier the market for generator was totally import-based, now local companies are making some parts of generator and assembling the device.

The most commonly available generators in the local market are diesel-run with capacities ranging from 500 watt to 500 kVA (kilo volt ampere).

A 500-watt generator can run around 5/6 lights and two fans for two hours, while a 500-kVA (1kVA=0.8kw) generator has the capacity to run an RMG factory for three days.

A 500-watt generator usually costs Tk 20,000 in the local market and a 500-kVA gas generator Tk 1.75 crore.

Industry people said the demand for generators ranges from 500 watts to 300 kVA and these are mainly used for the commercial establishments, especially in the urban shopping malls and factories.

Currently, the total market size for generator is Tk 400 crore per year, they said.

Rahimafrooz is the market leader that imports finished generators as well as components and also makes parts to assemble complete devices.

“Usually the demand remains high in the summer, but this year the demand has started rocketing before the season, meaning we will have to struggle to meet the demand this time,” said KM Ali, chief operating officer of Rahimafrooz Energy Services Limited.

“We import finished generators and also open ones, which need canopies to turn those into soundproof units and carriers to hold the devices that we make locally,” he said.

He said Rahimafrooz imports generators intact with three main parts — engine, alternator and controller — and then attaches locally produced things to make those complete units and then markets the generators for both residential and corporate use.

He said his company also makes automatic transfer switch for generators that helps run a unit automatically when power goes off.

Ali said the customers of his company include industrial plants, real estate firms, hospitals, educational institutions, telecom companies, supermarkets, corporate houses and government establishments.

The company is the official distributor of Italian brand Pramac and imports both diesel and gas generators from Italy, Spain and Japan, he added.

Currently, Rahimafrooz holds around 40 percent of the local market share.

Around 10 other local and imported brands are also available on the market and around 50 small companies import and assemble diesel generators.

Ziauddin Abu Nasser, a senior executive at HS Enterprise, official distributor of Honda generators, said the main customers of generators are the shopping malls and offices.

Honda generators, which had nearly 20 percent market share last year, are mainly imported from Japan and the prices range from Tk 22,000 to Tk 85,000.

Generators are also assembled in the local light engineering sector.

Sakiba Engineering Works, a local light engineering products manufacturer at Dholaikhal in Dhaka, assembles diesel generators using old parts and attaching canopies and carriers.

Saker Ali, assistant director of Sakiba Engineering, said the cost of making these parts and then assembling locally help lower the prices of generators that mainly cater to the needs of small traders around the country.

However the industry people demanded that the government cut the diesel price so more people, including farmers, can afford generators.

“An affordable generator will not only help a farmer, but will accelerate the entire economic activities of the country,” the Sakiba official said.

Govt mulls setting up of separate Engineering industrial park

Govt mulls setting up of separate industrial park

FE Report

Industries minister Dilip Barua said Tuesday the government is actively considering setting up separate industrial park for the country’s booming light engineering sub sector.

He was addressing a workshop on problems and prospects of light engineering industry as chief guest at a city community centre.

The programme was organised by Small and Medium Enterprise (SME) Foundation in collaboration with Bangladesh Light Engineering Owners Association (BLEOA).

“We are finalising industrial policy. Under the policy, separate industrial parks will be set up for the light engineering, automobile engineering and sub contracting sub sectors,” Mr Barua said.

He said the work for building separate industrial zones for the pharmaceuticals and plastic goods manufacturers has already started to give a boost to the potential sectors.

“I personally think that there is necessity for setting up separate industrial zones for the potential sectors to ensure a balanced industrialisation in the country,” he added.

He said: “We hope the industrial parks will be implemented shortly.”

BLEOA President Abdur Razzak told the FE: “We have already earmarked an area for installing a separate industrial park for light engineering industry at Keraniganj area. We want it under public private partnership.”