Current scenario, prospects and challenges of plastic sector of Bangladesh

Md. Jashim Uddin
Notable developments in the plastic industry of Bangladesh started from early 1980s. Prior to that period, some small plastic factories were in operation with manually operated machinery, mainly in the older parts of Dhaka. During the years 1980 to 2000 there was a remarkable increase in plastic goods production in Bangladesh with an average growth rate of more than 20% per year. This trend still continues as the demand for plastic goods has been rising continuously. Today, we can proudly say that most of the household plastics and packaging materials that are used in the Bangladesh are being manufactured locally.
Currently there are more than 5000 plastic products manufacturers in Bangladesh. The number is increasing faster than most of the manufacturing sectors in Bangladesh. Many of these factories are still operating from the old part of Dhaka without any concern on the environmental issues. The newly set up industries are mostly complaint meeting the world's social, environmental and ethical standards.
Plastic factories in Bangladesh are meeting local demand for plastic goods and also exporting the same.
There are more than 500 industries involved in production for the export market. Most of these factories have bonded wareherese facility and environmental license. Some of these factories are complaint having their own recycling plants.
Plastic goods are exported directly to Poland, China, UK, Belgium, France, Germany, USA, Canada, Spain, India, Nepal, Bhutan, Australia, Sri Lanka, Japan, Malaysia, UAE, Hong Kong, Bahrain, Italy, New Zealand, Netherlands, etc.
The current domestic market is worth around Taka 90 billion and the export market is worth Tk. 27 Billion.
Nearly all capital machinery for plastic industries are imported from overseas. Small and low-end product manufacturers usually import cheaper machines from India, China and Thailand whereas the high-end industries import their machines from Taiwan, Japan, Europe and America.
The total direct workers at a plastic industry vary depending on the size and age of the unit, volume of production and most importantly on the quality of the machinery used. In small sized units, the requirement workers to produce one metric tonne of finished goods is usually a few times more than that in medium and large size units. This is mainly because most medium and large sized units use sophisticated automated machines where the production speeds are faster. Also, the newer units use better, faster and automated high-end machines.
An estimated 1.5 million workers are directly and indirectly involved in plastic sector of Bangladesh.
The basic raw material used for all kinds of plastic industry is thermoplastic moulding compound in primary form. All basic raw materials are imported from overseas as Bangladesh do not have any industry to produce the materials required.
It must be noted that the industries are able to use waste from the plastic production process and also post-use waste. About 20% of the raw materials of plastic industries in Bangladesh are from recycled material.
Major countries from which plastic raw materials are imported are the U.A.E., Kuwait, Thailand, Sri Lanka, Japan, Malaysia, China, India, the USA, Australia, Singapore, Germany, Korea, Taiwan.
Following are a brief list of products manufactured by the plastic industries in Bangladesh :
a) Retail Packaging: Plastic containers for food and non-food products; packages for retail sales;cosmetics and industrial packages; woven sacks, garbage bags, butcher bags, industrial films, polythene sheets, plastic hangers, gloves, ropes, freezer bags, etc.
b) Industrial and bulk packaging: Woven sacks for food grain, chemical, fertilizer, cement, poultry food, rain protectors, green-house films, etc.
c) Household uses: Tableware and kitchenware, pet bottle, chair, table, bathtub, jug, mug, bucket, container, food box, flasks, plates, glasses, spoons, soap case, toilet brush, pan, toys, artificial flowers, clock, etc.
d) Office Equipment: Ball pen, marker, paperweight, scale, desk calendar, File cover etc.
e) Building Materials: Door, Windows frame, pipes, pipefittings, Electric cables, electric switches, water tanks etc.
f) Engineering Parts & Industrial parts: Cone, Bobbin, Silver Can, Screw, containers, drums, plastic spare parts for machinery etc.
g) Medical Instruments: Blood Bag, Medicine Container, Injection, Saline Bag, medicine packages etc.
h) Agricultural Products: Plastic pipe, Dram seeder etc.
i) Poultry & Fishing:  Pot, Jar, Fishing Net, Fishing Ball, Egg Crate, Fish Crate etc.
j) Automobile & Cycle Parts:  Cars bumper, Handle grieve cover, Back light, Spoke light, Dash board etc.  
k) Electronics:  Calculator, Plaque, Holder, Multi Plaque, Regulator, Cables, Fridge and TV parts, etc.  
l) Textile Articles: Polyester yarn.
m) Engineering Products: Accessories for electronic products, etc.
n) Musical Products: Video/ audio cassettes, etc.
Prospects:
a) Growth rate has averaged more than 20% each year for the last 20 years
b) Nearly all the plastic goods for household use in
Bangladesh that were imported in the past are now being made in the country
c) Our per capita usage of plastic per year is around 5 kg compared to more than 50kg per year in many developed countries. The use of plastic is expected to increase as the country becomes more developed
d) We now have several world standard industries some of which are ISO certified meaning that they comply with environmental requirements
e) Nearly 100% of plastic production wastage are recycled for re-use, thus reducing the amount of waste going into the environment
f) In the year 2010, 60% of the post-use plastic waste was recycled in the country resulting in a saving of US$ 600 million savings on import of virgin raw material
g) Some of the waste plastic is being recycled and exported from Bangladesh. An amount of about 10 million dollars of recycled pet bottles were exported last year
h) With the industrial growth of the country the need for plastic items will continue to grow because most machinery and equipment these days rely more on plastic spares rather than metal
i) Our plastic industries have had notable success in some items such as plastic pipes used in construction, electric cables, furniture, etc. In some of these items our industries are catering to 100% of the need of the country and have now started exporting
j) Unskilled and semi-skilled workers are needed in good numbers in some of the production process of plastic industry
k) There is a huge potential for continuous growth in the deemed export (indirect export) of plastic products through the export industries of products other than plastic. With the growth of export of garments, pharmaceutical, leather, etc. the deemed export of plastic will continue to grow
l) We have high growth potential for the direct export of plastic goods. Our export has been growing at a steady level and it will continue to grow because our competitors (mainly India, China, Thailand, Malaysia) are becoming uncompetitive due to high labour wages
m) Bangladesh enjoys GSP and preferential facilities from some of the developed countries and will help our exports to grow
n) About three years ago some European countries and USA enforced anti-dumping duty on some of the plastic industries in China, India, Malaysia and Thailand. This gives us an opportunity to take advantage of the market.
Challenges:
a) All the basic raw materials are imported from overseas as we do not have any polymer industry in Bangladesh
b) The working capital requirement is very high compared to other industries as plastic industries are required to import and stock sufficient raw material for uninterrupted production
c) High prevailing bank interest rate has a negative impact on the growth of the industry
d) Plastic industries are faced with acute shortage of skilled labour
e) Plastic industries require continuous un-uninterrupted electricity as its production is based on mostly on heat. Load shedding and power disruptions results not only in slowing down the production, it also damages quality and equipment
f) Government's policy makers has always maintained a negative attitude towards the plastic industries and this in turn has prompted NGOs to look into plastic issue negatively - the commercial aspects and the strength of the industry are not being considered with an open mind mainly because of the failures to manage post-use plastic waste
g) With the growth of the plastic industry and the uses of plastic products the threat to the environment will continue to increase. Managing post-use plastic waste will be a big challenge
h) There is a lack of coordination and communication gap between the Department of Environment and the plastic sector
i) With the growth of the plastic industries the need for spares and accessories for the industry will continue to increase. Bangladesh does not have a strong light engineering sector to support the plastic industries thus making the sector highly dependent on import of these spares and accessories
j) There are hundreds of small plastic industries located in the older part of Dhaka. Due to space constraints, most of these industries are unable to comply to the environmental requirements
k) Most people do not realize that "plastics do not litter, people do". People in general are not aware that plastic waste can be managed, recycled and re-used
l) There is a lack of educational institutes in Bangladesh that teaches polymer science and technology
m) Plastic industries have to invest significant amount of money to import mould for their industries. Skilled mould-makers, operators, and computer-based designers are unavailable in Bangladesh
n) Bangladesh does not have any testing laboratory to test quality and strength of plastic goods.
The author of the article is president, Bangladesh Palstic Goods Plastic Goods Manufacturers & Exporters Association (BPGMEA) and Former first vice-president of the FBCCI