The country's cottage industry, considered to be the life blood of small entrepreneurs as well as of employment in rural areas, has been a sufferer on many counts. Until recently, there was no comprehensive database on this largely undefined sector that could have otherwise provided relevant information in a structured manner to not only facilitate planning at the macro level, but also help the industry insiders to plan their business according to requirements.
The Bangladesh Bureau of Statistics (BBS) has of late come up with an elaborate database on the sector through what appears to be extensive field survey. For the first time now, the concerned quarters are in a position to look at the size of the vastly disorganised sector -- some key essentials that determine the overall characteristics common to its diverse sub-sectors as well the peculiarities varying from place to place.
In fact, absence of a database has deterred the planned growth of the sector, and the government unaware of the needs was not in a position to respond to the requirements of the entrepreneurs to address the problems facing the sector. Occasionally, foreign aided projects taken up without proper need assessments in product development, adaptation and marketing failed to meet the actual needs of the sector, comprising a myriad variety of sub-sectors.
The BBS survey, conducted on the enterprises across the country in 2011 and released recently, shows that the country has a total of 830,000 units employing a workforce of more than 29 million. Given the large number of the units, the encouraging feature is that almost 97 per cent of these units remain functional throughout the year. The sector produces goods valued at Tk 395.38 billion annually with value addition amounting approximately to Tk 314.86 billion. As many as 56.3 per cent of the units are in the rural areas of which 20 per cent are in the very yards of the owners' homestead. There are other findings that can be useful to the concerned quarters, including researchers and practitioners. One disquieting feature is that about 16 per cent of the workforce employed in the industry do not get any wages as they are the members of the family engaged in the production process. This goes to further explain that their labour, not being recognised in terms of wage, is virtually rendered unproductive as it is not reflected in the manufacturing process, as cost.
The BBS survey conducted on 34 sub-sectors of the country-wide cottage industry units shows that the highest concentration of these units are in the Dhaka division - around 30 per cent of the national aggregate, while the least in the Sylhet division. While they spread across a wide variety of manufacturing processes, they also suffer from certain basics that otherwise would have entitled them to more gainful performances. The very definition of cottage industry as laid down in the Industrial Policy of the government is also considered by many too narrow and not time-befitting.
According to the definition, units employing a workforce not exceeding 10 and with a running capital below Tk 500,000 are classified to be recognised as cottage industries. This definition actually serves no purpose to determine the status of a cottage industry unit in this age of technology. It is assumed that because of the definition prescribing limits on workforce and running capital, majority of these units are not registered either with the Bangladesh Small and Cottage Industries Corporation (BSCIC) or with local government bodies. Although there is the provision that cottage industry units are to be registered with the BSCIC, registration still does not seem mandatory. It has been found in the BBS survey that less than 4.0 per cent of the units are registered with BSCIC, a clear reflection that these units do not look up to the state agency meant to extend support services to them.
The scenario, needles to say, is chaotic. What could have been a worthwhile method of catering to the needs of these units is a systematic effort to organise them towards product development, diversification and adaptation for both domestic and export marketing. Transfer of technology, use of appropriate tools and equipment as well as changes in the use of basic inputs are all important areas crucial to the development of the sector. Credit facilitation, depending on the government's policies, could also make sense if the authorities, namely BSCIC, were able to monitor the activities of this vastly disorganised sector. The BBS database will hopefully provide important clues to work on. Besides the government, private agencies - non-government organisations (NGOs) - can also set out plans to facilitate the sector.
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Towards planned growth of cottage industries
Wasi Ahmed | Published: March 25, 2014 00:00:00 | Updated: November 30, 2026 06:01:00
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