Potential of light engineering products remains largely untapped

FE Team | Published: March 29, 2013 00:00:00 | Updated: February 01, 2018 00:00:00

Shamsul Huda The light engineering (LE) factories in the country, especially those around Dholaikhal in the older part of Dhaka, 'manufacture' spares for automobiles, railway, industrial and many other sectors with an aggregate value of their output at about Taka 200 billion, a rough reckoning by the concerned circles suggest. Without any proper institutional support, the young workers at Dholaikhal light engineering hub and also those across the country are 'manufacturing' five thousand types of spares, thus saving Tk 120 billion's worth of foreign currency that would have otherwise been required for import of those items. Currently, more than forty thousand LE factories are operating in the country. Of them, six thousand units are located in Dhaka. The number of such units is twelve hundred in Dholaikhal, Sutrapur, Lalbagh and Kotowali areas in the capital. A source related to this sector said despite its being declared as a 'thrust sector', supports to it are not yet satisfactory. If related units could enjoy proper patronage by the government, they could be the 'second-largest' export earning sector after ready-made garments (RMG). Professor Dr M Kamal Uddin, head of the Appropriate Technology Department, Bangladesh University of Engineering and Technology (BUET), told the FE that the current volume of manufactured items in the light engineering sector could be increased five fold, had there been appropriate supports by the government. Apart from training them up in operation of highly technical machinery, the BUET has been imparting to them knowledge about testing, marketing, pricing and the mechanism of the products' export, over the last few years, he added. "Land, modern technology, power, raw materials and access to finance are not in favour of the owners of Dholaikhal factories. We cannot meet the all the compliance requirements by the banks," said a factory owner. "Banks want collateral against loans, but we are not capable of providing them as we do not have licences and other documents that the banks require", he observed. Abdur Razzak, president of the Light Engineering Industry Owners Association (LEIOA), said in the absence of proper technology, local LE products are becoming costlier than the Chinese and Indian ones. Except seven to ten factories, the most are not getting bank loan facilities as the banks require balance sheets, workers' lists, licences, collaterals, and related documents on experience and others related matters, the LEIOA president said. "Though some of our factories comply with conditions for having bank loans, they are not going for such borrowings at high landing rates that are simply not possible to be paid back by the units, operating only at 5.0 per cent profit margin." "If we do not use cutting-edge technology, our products will lose their quality and competitiveness and will become costlier than the imported ones", he said. Production in mass volumes by using modern technology may help the local products to become competitive with the imported ones, said Abdul Halim, owner of the Globe Engineering Workshop. The light engineering association president demanded uninterrupted power supply, upgradation of technology, access to finance and long-term training facilities for the workers. Light Engineering Product Business Promotion Council, under the Ministry of Commerce, has been arranging training programmes from time to time for the personnel who are involved in the LE sector. BUET's appropriate technology department is providing training support to the workers at Dholaikhal and those in other parts of the country. The Globe Engineering Workshop proprietor said after being trained up at BUET, he was enabled to upgrade his skill and he is now better aware than before, of some high-tech machinery. "Our main raw material is iron, and currently we are facing its severe supply-related problems as we do not get different types of this metal as per our demand for specific types of spares", he said. The appropriate technology department chief of the BUET said despite the availability of iron from ship scraps, the LE sector is facing such problems due to mismanagement. He said as it is not possible for an individual factory owner to buy a high-tech machine, there can be arrangements for cluster-based investment initiatives. A source at the Export Promotion Bureau (EPB) said exports of LE products from Bangladesh are increasing to Africa, the Middle East, the seven-sister states in India and other countries. According to sources, the Bangladesh Machine Tools Factory (BMTF) and Bangladesh Industrial Technical Assistance Centre (BITAC) can take up supportive measures in a concerted manner to facilitate the growth of the light engineering sector. He said there are big swathes of land in BMTF, where they can allocate some space to LE factory owners. In order to manufactured more quality products at factories on the BMTF land, there can also be some 'factories' with training facilities in operating modern machinery, the EPB source said.