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Need for a light engineering policy  

Published: June 11, 2019 22:05:55 | Updated: June 13, 2019 22:07:52


The demand recently voiced by the leaders of the light engineering association for a separate policy to stir planned growth of this vastly disorganised industrial sector deserves serious attention. Clearly, this sub-sector has been experiencing a robust growth in the country, but it still is in need of the care that only a comprehensive policy can deliver.

Light engineering is considered the mother of other industries. Over 90 per cent of these units meet domestic needs and the market size is estimated to be around Tk 600 billion, according to Bangladesh Engineering Industry Owners' Association (BEIOA). As a feeder sub-sector, light engineering manufactures machines, equipment, tools of heterogonous varieties for domestic usage in mills, factories and engineering workshops. Besides providing cost-cutting benefits to the consumers, its all important role is in saving foreign exchange that otherwise the country would have to spend on imports. It is estimated that the light engineering currently accounts for around 50 per cent substitutes of imported items in the country. This is reflected in the support it provides to industrial, agricultural and construction sectors by manufacturing a wide range of spare parts, castings, moulds and dices, oil and gas pipeline fittings and light machinery, as well as repairing those. Equally significant is its role in job creation. Rough estimates suggest that as many as 600,000 skilled and semi-skilled workers are employed by around 40,000 micro enterprises and 10,000 small and medium enterprises (SMES) under this sub-sector. The sub-sector is reportedly manufacturing products worth Tk 250 billion with local technology. A news item, published in this newspaper recently, highlighted some of the prospects as well as the immensely gifted potential of the sub-sector that could be capitalised for its growth as a major import substituting industry.

These small and medium enterprises are currently facing serious hardship on various counts, according to the Bangladesh Engineering Industry Owners' Association. These include lack of advanced technology, dearth of skilled manpower, absence of product diversification and market promotion measures. Over and above, the entire industry is without any worthwhile credit finance. Industry insiders stress the point that bringing the innumerable work units under an integrated plan is crucially important, and to do so, a separate policy for the sector has been long overdue. Government policy for the sub-sector would also facilitate adoption of work programme for product development and product adaptation for both domestic consumption and export.

It indeed appears strange that despite the enormous size of the sub-sector, it is running on its own - mostly haphazardly - without any policy direction and support. This is no doubt the reason why despite its commendable performance, it is yet to assume institutional shape. It is here where lack of interest of the relevant government agencies can hardly be overlooked. In order for the sector to attain institutional shape as well as growth and diversification, the key requirements are government's policy support, public-private joint initiatives for institutional and financial assistance, availability of technical and business information, innovation and upgrading technology.  

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