Easy access to finance, haphazard growth and lack of duty-free access to the regional market are the key constraints the local farm machinery sector is facing, insiders and experts said.
Currently, thousands of workshops, including foundries and repair and maintenance boutiques, are engaged in the agro-machinery manufacturing sub-sector in northern, north-eastern, south-western and central regions in the country.
Jashore, Bogura and Kushtia regions have become the major hubs of manufacturing agro-machinery by local foundries and engineering workshops, they said.
Jashore is also leading the trade in imported machinery.
Talking to the FE, vice-president of the Bogura Chamber of Commerce & Industry (BCCI) Mahfuzul Islam Raj said the agro-machinery manufacturing market in Bogura district is worth around Tk 10 billion.
"The Bogura foundries and engineering workshops mainly supply spare parts to the country's rice mills, jute mills and flour mills apart from producing traditional agro-equipment," he told the FE during an interview.
Mr Raj advocated establishing a separate economic zone for the agro-machinery producers.
The manufacturers should also have easy access to loans enabling the light engineering industry to adopt new technologies for meeting the demand for modern agro-machinery.
Researchers echo his views.
Dr Md Monjurul Alam, a professor of Bangladesh Agricultural University (BAU), said Bogura and Jashore can be declared "Agro-machinery districts" by ensuring infrastructural facilities such as uninterrupted supply of electricity, gas, water etc., for the production of agro-machinery and spare parts.
The agro-machinery production zones on the outskirts of the two towns can be established to accommodate existing and future agro-machinery industries and workshops, he added.
Provisions should be made for duty-free access to SAARC and developing countries, and formal trading of agro-machinery at border markets (hats) through bilateral negotiations with India, he said.
A central Institute of Agricultural Engineering can be established for fostering innovation through R&D. Collaboration between the government and the development partners in this connection will be of great import, he said.
He also placed importance on the formulation and updating of the National Agricultural Mechanisation Policy; modernisation of local foundries through collaboration and experience sharing activities among SAARC and industrialised countries.
"Access to soft, flexible and long-term credit facilities for capital machinery and working capital need to be considered," he said.
Policy options should be considered for the removal of multiple VAT on imported raw materials and strengthen rules and regulations against illegal hoarding of raw materials for the growth and development of the sector, he said.
Policy should also be rationalised for zero tariff/nominal tariff on the import of modern capital machinery for the agricultural segment, he added.
The recommendations for developing the country's agro-machinery sector were made in a 2017 study by Professor Alam of BAU.
General secretary of the Foundry Owners Association of Bogura Abdul Malek Akanda said foundries are the lifeline of engineering workshops and industries.
The metal casting factories supply primary and basic parts for manufacturing different types of machinery, especially for the farm sector.
Without modernisation of the metal workshops, it is not possible to develop innovative and modernised products for the country's engineering sector, he said.
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