Distributors should set up own plant

FE Report | Published: March 12, 2014 00:00:00 | Updated: November 30, 2025 06:01:00

Demand for motorcycle in Bangladesh market is significantly rising thanks to the gradual increase in necessity of the people to use the motorbikes, a two-wheeler business man said.
"The increasing necessity of the motorbikes is also clearly indicating high demand for manufacturing of the two-wheeler locally in order to bring its price level under the people's capacity," Dr Md Shamsul Alam, Head of Business Planning, Uttara Motors Ltd, told the FE.
Mr Alam, however, said manufacturing of motorcycle locally is facing set back due to mainly lack of specific government policy in the sector.
The more the total population is increasing, the poverty level is decreasing, the more that population having needs for motorcycle is rising in Bangladesh, he said presenting some figures.
Against 1000 people having necessity to purchase and use motorbikes, only four of them are availing themes of the two-wheeler in Bangladesh, he said.
"In Bangladesh, there were about 675,000 motor cycle population in 2010, which was 600,000 in 2009, 520,000 in 2008 and 410,000 in 2007," Mr Alam said.
As the world's densely populated country, in Bangladesh, an extensive road-network were made in the rural areas, creating opportunities for trade and commerce; because of its versatilities, motorcycle, as one of the mode of transport, caused a significant growth in necessity of the motorcycle in Bangladesh market, he said.
Country's entrepreneurs are locally making small-sized spares; but due to lack of specific policies, this sector cannot make significant collective progress; there is a government policy through SRO No 213 Law/2010/562 Dt 10/02/2010, but it was not realistic as it mentioned all entrepreneurs should make same type of machinery and spare parts.
"If this policy continues, production of complete Motor Cycle will not be possible by any means", Mr Alam said.
The locally manufactured machineries and spare parts must be procured by local and international manufacturers through outsourcing; VAT exemption may be rendered for these entrepreneurs. Thus small linkage industry will emerge and a new scope of employment will be opened. Simultaneously a huge amount of foreign exchange will be saved.
Tax exemption may be applied for raw materials (plate, sheet, steel, tube etc) where necessary for patronising these small scale native industries and these items may be excluded from VAT. Consequently, production of spares for motor cycle and other vehicles will be possible in optimum quantity, he continued.
As foreign investment is needed for the sector's development, manufacturers of concerned parts and components may be declared as individual sector with 10 years tax holiday to attract and ensure foreign investment, he said.
Currently deletion is not available over import of CKD components of motor cycle. As a result, locally manufactured components have no lawful way to be used in products manufactured in our country; we expect production of these components will be possible locally, he said, adding that if deletion provision can be introduced in CKD, we shall save huge foreign exchange.
Mentioning that industrialisation is essential for development, he said, many countries have special package, motivational policies and various safeguards in this connection. He expected harmonic, logical, balanced and loyal competition between local and imported products, which will preserve consumer's rights.
If motorcycles distributors in Bangladesh set up their own manufacturing plant locally, they will be able to fulfill our local demand, and also export their products in overseas market in the future, creating huge local employment and simultaneously saving and earning foreign currency.