Cash incentives may lead to 70pc growth in furniture export in next fiscal year

Furniture export may register 70 per cent growth in the next fiscal if the sector gets cash incentives from the government, industry insiders said.

Due to new contracts with Japan, US, Korea and other countries the export will increase 20 per cent during the current fiscal (FY) 2013-14 compared to that of the last fiscal.

Bangladesh exported furniture worth US $31.41 million in the FY 2012-13, up 15.73 per cent from the previous year, according to the EPB.

Until March of the current fiscal, the country exported furniture worth $ 27 million. As per the expected growth, the export for the current fiscal will be $ 37.69 million. And it will be 64.07 million in the next fiscal, said a leader of the furniture exporters association.

At present the furniture exporters are not getting cash incentives from the government. If the entrepreneurs get such facility then the export will rise significantly.  

"If we get cash incentives from the government then it will be possible to make a 70 per cent growth of our export in the next fiscal," President of Bangladesh Furniture Exporters Association KM Akhtaruzzaman told the FE Saturday.

He said that the furniture industry has a lack of skilled manpower. The government should establish a separate institute or college for the sector.

He stressed on skilled manpower along with modern- tech facility to increase the export.

Bangladesh enjoys duty-free market access for furniture exports to most leading Asian countries such as Japan, Korea, China and India.

Furniture is one of the most rapidly growing sectors in Bangladesh, graduating in the last 15 years from a cottage-based to a manufacturing industry.

The manufacturing of wooden furniture accounts for 0.29 per cent of the country's gross domestic product (GDP).

At present, local manufacturers sell furniture worth around Tk 140 billion a year in the domestic market. About 2.5 million people are now engaged in the sector.

The main suppliers of furniture to the global market are Asian countries worth around $350 billion. The US is the key market for furniture exports.

Bangladesh has potential to increase furniture exports due to its cost competitiveness. Furniture is a labour intensive industry and its domestic market is limited. So we will focus more on such exports, said a high official of the MoC.

 "We are considering taking necessary steps for providing cash incentives on furniture exports," the commerce ministry official added.

Bangladesh's exports grew to $27.01 billion in fiscal 2013-14, up around 11 per cent from the previous year, while garments account for $21.51 billion or 79.63 per cent, according to the EPB.