Manufacturing sector feels the chill from tumult : MCCI

With political unrest 'significantly' straining manufacturing, an elite chamber has urged the government to adopt suitable measures to support the sector by plugging gaps in infrastructure, power and energy supplies.
The Metropolitan Chamber of Commerce and Industry, Dhaka said "Infrastructure deficits and power sector problems were undermining the performance of the manufacturing sector," in the quarter through December of the current fiscal.
In its quarterly economic review, released Saturday, the MCCI said manufacturing activities showed signs of regaining momentum, thanks to the calm political situation, which earlier had badly affected production.
The chamber said local manufacturers in the post January 2014 election period were making desperate efforts to increase output and cover up production losses as quickly as possible.
It said that while the power supply situation improved in the quarter, the availability of power still remains insufficient to meet the overall demand.
At the end of December last year, total actual generation during day peak hours was 4,396 megawatt and during evening peak hours was 5,914 mw. The demand was 5,424 mw and no load shedding was on that day. In January, total installed capacity rose to 11,294 mw, and present capacity to 10,203 mw, but production remained low because of gas shortage and also because some power stations were shut for maintenance.
In addition to its plan to reach electricity to every household by 2021, the government in collaboration with China is building a coal-based 1,320 mw power plant in Patuakhali at an estimated cost of $2.0 billion.
Bangladesh will also get 100 mw of electricity from Palatana Power Plant of Tripura
The chamber said local manufacturers in the post-January 5 election period were making desperate efforts to increase output and cover up production losses as quickly as possible.
The chamber in its review said manufacturing activities showed signs of regaining momentum, thanks to the apparently calm political situation, which earlier had suffered badly.
The political unrest during 2013 badly affected construction activities, including in construction work under both public and private sectors.
The industry could not recover even in the peaceful 12-month period after the 05 January 2014 elections. According to the Real Estate and Housing Association of Bangladesh (REHAB), Tk 76.80 billion investment by builders remained virtually stuck up.
Sale of flats and plots by developers declined by 60 per cent while the number of new projects dropped by 75 per cent.
Nearly 21,000 ready apartments remained unsold due to the political unrest.
As the sector is still passing through tough time, realtors slashed apartment prices by about 11 per cent year-on-year on average to reinvigorate the depressed property market, according to the review.
Along with developers, the backward linkage industries were also in dire strait as demand for their products fell by over 60 per cent.
Manufacturers of construction materials like MS rod, cement, paints, furniture and tiles were facing tough time. The sale of land plots across the country also declined to the lowest level.
In the quarter under review that preceded the first anniversary of the 05 January 2014 elections, apartment and plot sales were recovering, albeit slowly, from the downtrend caused by political unrest before the January election.
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