Agriculture in Bangladesh is still a vibrant sector. Its contribution to gross doemstic product (GDP), according to the Bangladesh Bureau of Statistics, is 19.29 per cent. The sector employs 47.5 per cent of the total manpower - the largest work force in a single sector. The agri workforce comprises mostly unskilled manpower.
A major challenge the agriculture sector faces is that many of its products are not processed well and these also lack value addition.
Having bright prospects for well processed and value-added agro-products in markets at home and abroad the concept of agro-processing emerged in Bangladesh in the early ninties followed by the establishment of Bangladesh Ago-Processors Association (BAPA) to fulfil a set of objectives.
These include, among others, protection, development, support and promotion of all measures and taking steps towards growing, producing, processing, manufacturing and marketing at home and abroad of all agricultural items such as fruits, vegetables, horticultural products, field crops, mushrooms, dairy, poultry and fisheries and coordination of efforts of the members of the BAPA to this end.
In Bangladesh, poverty, unemployment and lack of skills present major challenges to its vision to becoming a middle income country by 2021. Such challenges are interlinked. If skills of the huge workforce could be developed through apprenticeship and training, it would lead to more productivity in agro-processing sector which will increase earnings both from local consumption and export. This would help establish more labour-intensive industries creating more employment. The SMEs (small and medium enterprises) in agro-processing that invlove small capital base and physical labour suit the startegy well.
Agro-processing sector accounts for 22 per cent of total manufacturing production and engages 20 per cent of the national labour force. High vulnerability of SMEs in agro food industry in Bangladesh persists due to lack of skills, low productivity and lack of competitiveness. So, better business environment and strategies are needed. Agro SMEs need support from their business intermediary organisations, bigger enterprises and genuine government backing.
Poor and marginal people work in the agro-SMEs. If they can be made technically skilled through training, they can process the products better and those can cater to the growing demand in the local and international markets. Bangladesh's agro-products are now being exported to a number of countries. If the products base can be expanded and quality ensured the sector can earn the country more foreign currencies.
Compliance is another challenge to be taken up even if its cost might be more than the duty-free advantage. New generation of managers needs to be created via introduction of technical and management skills in the enterprises including market information, packaging, branding and marketing knowledge. Effective skills development centres are inevitably needed to address the SME needs to unleash the potential at the cluster level.
Against this backdrop, BAPA-European Union SME Competitveness Grant Scheme under the contracting authority of the Ministry of Industries (MoI) came into being in April 2014.
The clusters have been established in 1. Dhaka-Savar-Gazipur, 2. Rajshahi-Bogra-Pabna-Natore, 3. Narayanganj and and 4. Chittagong Hill Tracts (tribal) and Chittagong Area under the project.
A baseline survey on sustainable agro-SME development in the target clusters of through enhancing entrepreneual ability and technical skills has already been conducted that provides information for project planning, monitoring and evaluation.
The BAPA-European Union SME Competitveness Grant Scheme consists of two projects. These are a) The Road to Sustainable agro SME development in target clusters of Bangladesh through Ability and Technical Skills, and (b) Strengthening the capacity of Bangladesh Agro Processors' Association (BAPA) to enhance competitiveness' of its member SMEs involved in Agro-Processing.
The overall objective of the scheme is to achieve economic growth, increase employment and alleviate poverty through sustainable agro SME development in four target clusters. The BAPA-EU SME Competitveness Grant Scheme aims to create 200 new small entrepreneurs, another 60 from TVET students, 5000 jobs in such new SMEs with women or tribals sharing 50 per cent and also jobs for 2000 apprentices.
The SME Competitveness Grant Scheme envisions four results such as entrepreneurship development which will lead to business growth, increased sales, new jobs and increased business opportunities in the agro processing sector, the apprenticeship programme bridges the skills gap and boosts productivity of the members of agro food processing clusters, target business generate innovative business ideas, including value addition and enhanced capacity to explore international markets and sustainable mechanism for delivering entrepreneurship training for agro processing sector.
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