Industrial Development of Bangladesh

8/13/2019 Industrial Development of Bangladesh

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&owever, in 2""2(2""4, '.2 of the total e/ports were raw ute and

ute goods, 2.9 of the total e/ports were leather, ".2 of the total

e/ports were tea, 59.8 of the total e/ports were woven garments and

2'.4 of the total e/ports were 6nitwear.

What is Industry?

Industry is simply defined *by me as any activity by which you either

create materials, alter materials to create something else, or move

materials around. -lso, anything involving the usage of Blueprints in

any way is defined as an Industrial activity. +ey activities defined as

Industrial are ining, efining, lanetary Interaction, &auling,

esearch and !evelopment, and anufacturing. :ach of these

activities is complicated in and of itself, and contain their own sub$

activities. I will now give a brief overview of each of these activities,

including a touch on some of the sub$activities that they have, as well

as recommended :;: as ?loud mining. :ach player in :;:

starts out with the very basic s6ills needed to mine ore in a newbie

ship with a civilian mining laser. If you put time, effort, s6ill points, and

money into developing this career path, it can become an e/tremely

lucrative, if, in the opinion of some, boring means of creating income.

@or more information on this topic, your ne/t class should be ining

1"1 . lease note that oon ining is an advanced topic and is not

covered in ining 1"1 or 1"2. Briefly, it is the process of using a layer

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owned Atation * oA to e/tract basic elements from oons and refining

them into ob ects that are usable for #ech 2 production.

Refining

efining is the action of ta6ing mined ob ects and turning them into

materials usable for other actions. =re refining creates minerals which

are used for production. Ice refining creates isotopes and other

materials which are used to fuel a oA, or capital ship ump drives. >as

is not refinable, but is used in the creation of Boosters. @or more

information on this topic, your ne/t class should be efining 1"1

*coming soon .

Planetary Interaction

lanetary Interaction * I is the means by which you e/tract items from

planets which are used in the creation of oA fuels or structures, Aov

structures, or tech two items. I can be 0uite complicated and

potentially e/pensive. @or more information on this topic, your ne/t

class should be lanetary Interaction 1"1.

Hauling

&auling is simply the transportation of items from one point to another.

Chile most hauling is done for personal reasons, some players *and

even whole corporations speciali%e in the movement of goods. &auling

is accomplished in ships ranging from a shuttle to capital class

freighters and everything in between, all depending on the si%e of the

cargo and the danger level involved in the ob. @or more information on

this topic, your ne/t class should be &auling 1"1 .

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Research and Develo !ent

esearch and !evelopment * D! is all about wor6ing with Blueprints.

#here are many different 6inds of things you can do with blueprints,

such as ?opying, roduction :fficiency esearch, aterial :fficiencyesearch, Invention, everse :ngineering, and finally anufacturing.

@or more information on this topic there are several classes. @or

?opying, roduction :fficiency esearch, aterial :fficiency esearch,

your ne/t class should be esearch 1"1. @or Invention ta6e Invention

1"1. @or anufacturing ta6e anufacturing 1"1. everse :ngineering

is a highly advanced topic, and is covered under #ech 4 roduction.

Manufacturing

anufacturing is the method by which you ta6e some basic ingredients

and turn them into a finished product, which can then be used, sold, or

used as ingredients for other manufacturing obs. anufacturing, in

most cases, is the 6ing of Industry, which creates the end result of all

of the other Industrial activities. anufacturing runs the gamut

between creating a single round of ammunition, all the way up tocreating whole Atations in null$sec space. @or more information on this

topic, attend the anufacturing 1"1 class.

Class Wra "u

!uring this class, we tal6ed at a basic overview level about what

Industry is, and defined the 6ey career choices under it.

#han6s for attending Introduction to Industry. If you are interested in

any of these topics, I encourage you to attend the ne/t 1"1 type class

specific to your area of interest.

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Clar#$s %ector Model

Industry is often classified into three sectors primary or e/tractive,

secondary or manufacturing , and tertiary or services. Aome authors add

0uaternary *6nowledge or even 0uinary *culture and research sectors.

Industries can be classified on the basis of raw materials, si%e and

ownership.

aw aterials Industries may be agriculture based, arine based,

ineral based, @orest based.... Ai%e It refers to the amount of capital invested, number of people

employed and the volume of production.

=wnership Industries can be classified into private sector, state owned

or public sector, oint sector and co$operative sector

Industry in the sense of manufacturing became a 6ey sector of production

and labour in :uropean and Eorth -merican countries during the Industrial

evolution , which upset previous mercantile and feudal economies through

many successive rapid advances in technology, such as the steel and coal

production. It is aided by technological advances, and has continued toage 3 7
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develop into new types and sectors to this day. Industrial countries then

assumed a capitalist economic policy. ailroads and steam$powered ships

began speedily establishing lin6s with previously unreachable world mar6ets,

enabling private companies to develop to then$unheard of si%e and wealth .

@ollowing the Industrial evolution , perhaps a third of the worldFs economic

output is derived from manufacturing industriesGmore than agriculture Fs

share.

any developed countries and many developingHsemi$developed countries

* eopleFs epublic of ?hina, India etc. depend significantly on industry.

Industries, the countries they reside in, and the economies of those countries

are interlin6ed in a comple/ web of interdependence.

Industry is divided into four !ain sectors & uinary Aector ' They are(

%ector Definition

rimary #his involves the e/traction of resources directly from the :arth,

this includes farming, mining and logging. #hey do not process

the products at all. #hey send it off to factories to ma6e a profit.

Aecondar

y

#his group is involved in the processing products from primary

industries. #his includes all factoriesGthose that refine metals,

produce furniture, or pac6 farm products such as meat.

#ertiary #his group is involved in the provision of services. #hey includeteachers, managers and other service providers.

uaterna

ry

#his group is involved in the research of science and technology.

#hey include scientists.

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uinary

Aector

Aome consider there to be a branch of the 0uaternary sector

called the 0uinary sector, which includes the highest levels of

decision ma6ing in a society or economy. #his sector would

include the top e/ecutives or officials in such fields as

government, science, universities, nonprofit, healthcare, culture,

and the media.

-n -ustralian source relates that the 0uinary sector in -ustralia refers to

domestic activities such as those performed by stay$at$home parents or

homema6ers. #hese activities are typically not measured by monetary

amounts but it is important to recogni%e these activities in contribution to

the economy.

-s a country develops people move away from the primary sector to

secondary and then to tertiary.

#here are many other different 6inds of industries, and often organi%ed into

different classes or sectors by a variety of industrial classifications .

Industry classification systems used by the government Jwhich? K commonly

divide industry into three sectors agriculture, manufacturing, and services.

#he primary sector of industry is agriculture , mining and raw material

e/traction . #he secondary sector of industry is manufacturing . #he tertiary

sector of industry is service production. Aometimes, one tal6s about a

0uaternary sector of industry , consisting of intellectual services such as

research and development * D! .

ar6et $based classification systems such as the >lobal Industry

?lassification Atandard and the Industry ?lassification Benchmar6 are used in

finance and mar6et research . #hese classification systems commonly divide

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industries according to similar functions and mar6ets and identify businesses

producing related products.

Industries can also be identified by product chemical industry , petroleum

industry , automotive industry , electronic industry , meatpac6ing industry ,hospitality industry , food industry , fish industry , software industry , paper

industry , entertainment industry , semiconductor industry , cultural industry ,

poverty industry

labor$intensive industry $ capital$intensive industry light industry $ heavy industry

Industrial develo !ent

&istorically certain manufacturing industries have gone into a decline due to

various economic factors, including the development of replacement

technology or the loss of competitive advantage. -n e/ample of the former isthe decline in carriage manufacturing when the automobile was mass$

produced.

- recent trend has been the migration of prosperous, industriali%ed nations

toward a post$industrial society . #his is manifested by an increase in theage 3 1"
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service sector at the e/pense of manufacturing, and the development of an

information$based economy, the so$called informational revolution . In a post$

industrial society, manufacturing is relocated to economically more favorable

locations through a process of off$shoring .

#he ma or difficulty for people loo6ing to measure manufacturing industries

outputs and economic effect is finding a measurement which is stable

historically. #raditionally, success has been measured in the number of obs

created. #he lowering of employee numbers in the manufacturing sector has

been assumed to be caused by a decline in the competitiveness of the sector

although much has been caused by the introduction of the lean

manufacturing process. :ventually, this will lead to competing product linesbeing managed by one of two people, as is already the case in the cigarette

manufacturing industry.

elated to this change is the upgrading of the 0uality of the product being

manufactured. Chile it is easy to produce a low tech, low s6ill product, the

ability to manufacture high 0uality products is limited to companies with a

high s6illed staff.

%ociety

-n industrial society can be defined in many ways. #oday, industry is an

important part of most societies and nations. - government must have some

6ind of industrial policy , regulating industrial placement, industrial pollution ,

financing and industrial labor .

Industrial la)our

@urther information industrial sociology , industrial and organi%ational

psychology , industrial district , and industrial par6

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In an industrial society, industry employs a ma or part of the population. #his

occurs typically in the manufacturing sector. - labor union is an organi%ation

of wor6ers who have banded together to achieve common goals in 6ey areas

such as wages, hours, and wor6ing conditions. #he trade union, through its

leadership, bargains with the employer on behalf of union members * ran6

and file members and negotiates labor contracts with employers. #his

movement first rose among industrial wor6ers.

War

#he industrial revolution changed warfare, with mass$produced weaponry

and supplies, machine$powered transportation, mobili%ation , the total war

concept and weapons of mass destruction . :arly instances of industrial

warfare were the ?rimean Car and the -merican ?ivil Car , but its full

potential showed during the world wars . Aee also military$industrial comple/ ,

arms industry , military industry and modern warfare .

I%IC

IAI? * ev.5 stands for International Atandard Industrial ?lassification of all

economic activities , the most complete and systematic industrial

classification made by


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*ritish eriod(

#he process of industriali%ation and the growth of industrial capitalism in

India was integrally connected with the consolidation of British colonial rule

and the transformation of India from a feudal into a colonial and semi$feudal

country.

Industrial capitalism emerged and developed in India in conditions basically

different from those in which it had developed in the Cest. It arose in a

dependent country, ruled by foreign power and so was unable to develop

along independent lies. ?olonial rules transform the Indian economy into an

appendage of the metropolitan economy.

Aecondly, unli6e in Britain, industrial capitalism grew in this country not by

beginning of 2"th century Lamidars li6e onindra ?handra Eandi of

+ashimba%ar, Bra endra +ishor oy ?howdhury of ymensingh, Biprodas

aul ?howdhury of Eadia, #aran >obinda ?howdhury of abna and others

invested in industrial enterprises.

#hus industrial capitalism did not ma6e its appearance in this country in the

course of the normal evolution of industries as it did in the countries of the

Cest. Eo anti feudal, bourgeois social revolution, or technical leap has

prepared the way for its emergence. =n the contrary, it was transplanted

from an advanced capitalist country to a dependent feudal country to cater

the imperial needs of the former. #his is what industries in the 19th century

were and Bengal was no e/ception to this pattern.

Pa#istan eriod(

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-fter the partition of Bengal in 1957, :ast a6istan inherited a small share of

industries of Bengal. :ast a6istan got none of 1"8 ute mills, 18 iron D steel

mills and 1) paper mills of Bengal. =nly 9" of BengalMs 489 cotton mills, 1"

of its 1)) sugar mills and 4 of its 19 cement factories fell in the territory of

:ast a6istan. #he cement factory ?hatta6, Aylhet had to depend on

limestone supplied from -shaam, India. #he cotton mills of :ast a6istan had

to depend upon imported raw materials. #he 19'1 census revealed that :ast

a6istan had )4,245 uns6illed non$agricultural labourers, 11',58" s6illed

labourers engaged in manufacturing sectors, 185,'4' mining and 0uarry

wor6ers and 121,'22 professional persons. #he manufacturing sectorcomprising mainly of food, drin6 and tobacco processing units employed a

total )"2,87' persons *5.)7 of the total labour force , of whom 544,158

were involved directly in production process and 172,727 in subsidiary

activities. #here were a total of 4)",)"4 cottage enterprises which employed

959,"75 persons. =f the manufacturing units only about 2"" of the

enterprises used power.

#he industrial development policy of the >ovt. of a6istan had the

manufacture of arms and ammunitions, hydroelectric power, railway wagons,

telephone, telegraph and wireless reserved for the state and encouraged the

private sectors to come up with industrial ventures in all other sectors. 25

industries including ute, te/tiles, sil6 and rayon were sub ected to a central

planning. #he >ovt. created the a6istan Industrial !evelopment ?orporation

* I!? and a6istan Industrial @inance ?orporation * I@? to promoteindustriali%ation. I!? made significant contribution in the establishment of

industrial units in sectors such as ute, paper board, cement, fertili%er, sugar,

chemicals, te/tiles, pharmaceuticals, light engineering and ship building. #he

central >ovt., however, followed a discriminatory policy. It favoured Cest

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a6istan in industrial development and drained resources from :ast a6istan

for the purpose. It also directed most of a6istanMs e/ternal resources to the

cause of industrial development of Cest a6istan. Eon$Bengalis dominated

the list of entrepreneurs coming up with new industries ventures in :ast

a6istan. Nocal capital hardly got opportunity to flourish. #he central

government had control over product pricing to such e/tent that products

growth or manufacture in :ast a6istan was sold in the local mar6et at prices

higher than in Cest a6istan.

!espite all these impositions, however, some progress was made in

industriali%ation in :ast a6istan during the period between 19'"$197". #he

number of industrial enterprises in :ast a6istan in different sector in 197"was$

:nterprises Eo

O @ood manufacturePPPPPPPPPPPPPPP 5"8

O BeveragePPPPPPPPPPPPPPPPPP.... )

O #obacco processingPPPPPPPPPPPPPP. 2)

O #e/tilePPPPPPPPPPPPPPPPPPP....... 792

O @ootwarePPPPPPPPPPPPPPPPPP..... 2"5

O Cood and cor6PPPPPPPPPPPPPPPP 15

O @urniturePPPPPPPPPPPPPPPPPP..... 17

O aper productsPPPPPPPPPPPPPPPP 44

O rinting and publishing PPPPPPPPPPPP. 15

O ?hemical productsPPPPPPPPPPPPPP.. '72O etroleum D coal productsPPPPPPPPPPP. 4

O ubber productsPPPPPPPPPPPPPPP.. 4

O ineral productsPPPPPPPPPPPPPPP. '4

O Basic metalPPPPPPPPPPPPPPPPP.... 4'

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O etal productsPPPPPPPPPPPPPPPP 2'7

O Eon$electric productsPPPPPPPPPPPPP. 88

O :lectrical machineryPPPPPPPPPPPPPP 45

O #ransport e0uipmentPPPPPPPPPPPPP. )'

O iscellaneousPPPPPPPPPPPPPPPP... 1))

=fficial sources of the government, however, that in 197", there were 1'8"

manufacturing units in :ast a6istan that employed 2"),"'8 persons. #heir

gross output was valued at ta6a 4.)4) billion and the value added amounted

to ta6a 1.7"8 billion. #he share of the manufacturing sector in the >! was

8.9 in 197" as compared 4.9 in 19'".

*angladesh eriod(

#he industry sector was severely damaged during the war of liberation in

1971. eplacement and rehabilitation cost estimated for the industries were

estimated at ta6a 291 million of which ta6a 224 million was estimated for

public sector enterprises. #he public sector started in 1972 with$

o 72 ute mills with production capacity of 79,2"" tons.

o 55 te/tile mills with production capacity of 14.5 million pounds.

o 1' sugar mills with production capacity of 1)9,""" tons.

o 2 fertili%er factories with production capacity of 55),""" tons.

o 1 steel mill with production capacity of 4'",""" tons.

o 1 diesel engine with production capacity of 4""" barrels.

o 1 ship building yard *+hulna doc6 yard .

ills and factories in the public sector, however, soon become loosing

concerns largely because of mismanagement and lea6age of resources. #he

>ovt. had to 0uic6ly review its policy of dominating the public sector.

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-lthough it continued to e/ercise control over industries, it soon raised the

allowable ceilings of private investment. &owever, this did not bring much

improvement.

-fter a series of ad ustment and temporary changes in state policy, the >ovt.

finally adapted a new industrial policy in 1982 following which 1"7) state$

owned enterprises were handed over to private owners.


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o 4.5 in pottery.

o 4.2 in blac6smith.

o ".4 in oil crushing.

o ".8 in bron%e casting and

o #he rest in others type of crafts.

Ceavers wor6 in all most all parts in Bangladesh but the ma ority

concentrated in the area li6e Eorshingdi *Baburhat , &omna, Bancharampur,

Ba itpur, #angail, and Ahah adpur. &owever, sil6 has flourished in a shahi

and Bholarhat, cigar in ?o/Ms ba%aar, coil in Barisal, chec6ed carpet in

angpur, pottery and bamboo wor6s in ?omilla, mat and cane furniture in

Aylhet, bron%e casting in Eawabgon .In 1985 Bangladesh had '8 te/tile mills with an annual production of

capacity 1").2 million pounds of yarn and )4 million meters of cloth. #e/tile

is a public sector dominated in Bangladesh and li6e most other sectors

te/tile also brings losses which amounted to ta6a 4'4.5 million in 1985.

roblems of this sector include poor management as well as difficulties in

developing s6illed wor6ers and storage in supply of raw materials and power.

Bangladesh had 7" ute mills with 24,7"" spindles in 1985. #hese employed

1)8,""" wor6ers and 27,""" other staff and used '5',""" tons of raw ute.

But their production was less than the ')1,""" tons figure in 19)9, when the

country had '' ute mills with 21,'"" spindles. #he ute industry in the

country has been declining in the face of competition from India and ?hina

and in an international situation where ute goods are being replaced by

cheap and durable plastic products.

!evelopment of new industries li6e Aulphuric acid, chemicals, paper, caustic

soda, glass, fertili%er, ceramics, cement, steel and engineering in Bangladesh

was slow in the period before 198'. #here were only two plants for

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production of sulphuric acid in the country in 198' with a total production of

),""" metric ton while the production of this important ingredient for

industries li6e soap, paper, cast iron D steel was ),'"" metric ton in 197".

roduction of caustic soda in 198' was ),787 metric ton. #his was used

almost entirely in paper mills.

Because of the availability of sand, salt and limestone within Bangladesh, the

country has a good prospect in developing its glass industry. !ha6a and

?hittagong are the two largest centers for this industry. #he only automatic

glass factory that time *


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Aylhet, Bogura and a shahi. #he total production was 1.4 million gross

bo/es in 198'.

#hat year *198' Bangladesh had 8 sugar mills with a total production of

87,""" tons. #he sugar mills of Bangladesh produce only white plantationsugar. >ur is also produced which is sweater than sugar because of some

impurities present in it. #he sugar mill at !orshona also produces alcohol,

methylated spirit and rectified spirit besides pharmaceutical grade sugar.

#he iron and steel industry in Bangladesh were mostly under the steel and

engineering corporation and were concentrated in ?hittagong D !ha6a with

a few enterprises with +hulna, +ushtia and Bogura.

Industries mar6ed by notable development in Bangladesh in the mid 198"Ms

which includes$

o Ahip building.

o -utomobile assembling.

o =il refinery.

o Insulators and sanitary$wares.

o #elephone e0uipments.

o :lectrical goods.

o #; assembling.

o ?igarettes and

o ;egetable oil * :;=$ efined edible vegetable oil .

age 3 2"


19/51

#he country achieved a significant success in developing garments industry

in this decade. #he >ovt. followed a strategy of plant growth with Qfree$playM

of mar6et forces. #he manufacturing sector showed some growth in the

199"Ms. #he share of the manufacturing sector in countries >! grows to

11 in the 199). Investment in the manufacturing sector was ta6a '7.8

billion in 1997 as compared to 22.) billion in 1991. #he share of the public

sector in the total investment came down to 8.)4 in 1997 compared to

47."4 in 1991.

#he >ovt. continues to implement a privati%ation programme to hand over

public sector enterprises to private owners. Aimultaneously the >ovt.implement a programme of rehabilitation of industries identified as sic6

because of various reasons. Industries identified for rehabilitation under the

programme in 2""" included$

o 1 cement factory *-nnual production capacity ".1' million tons .o 1 paper mill *-nnual production capacity 4",""" tons .

o 1 news print mills *-nnual production capacity '2,""" tons .

o ) cigarette factories *-nnual production capacity )4" million stic6s .

o 8 oil mills *-nnual production capacity 945,818 tons .

o 2 food processing unit *9'",""" tons .

o 2 fish processing unit *).9 million tons .

o 2 cold storages *'.9 million pounds .

o 1 bevarage producing unit *5.4 million bottles .

o 4 chemical industry units *2),""" tons .

o 1 glass factory *97.' million feet and

o 12 pharmaceutical industries.

age 3 21


20/51

In 2""" the total employment in industry was estimated as )"",""" of which

the privati%ation sector employed '"",""".

Industriali%ation efforts of >ovt. during 199"Ms included investment in

balancing moderni%ation and reconstruction, creation of new industrial state

and e/port processing %ones, promotion of private investment and attraction

of foreign direct investment. #he policy changes have been in line with

trends in international mar6et, recommendations of donor countries and

agencies of liberali%ation of trade and investment and structural ad ustmentprogrammes.

-lmost at regular interval of 5 to ) years after 1982, the >ovt. adapted new

industrial policies with increased incentives for private investors from both

home and abroad. #hese policies have some common aspects such as$

O Incentives to promote industriali%ation in rural and remote areas and

O #o encourage entrepreneurs to use local raw materials

and the efforts towards development of a system that would help in

development indigenous product as well as transfer of modern technology.

Industrial roduction gro+th rate ,-.

Country/00

1

233

3

233

/

233

2

233

4

233

5

233

6

233

7

233

1

233

8

233

0

23/

3

23/

/

age 3 22


21/51


22/51

%tatistics


23/51

engineering, sugar ,

fisheries , rubber ,

ship repairing ,

agriculture

9ase of Doing *usiness Ran# 122nd

9>ternal

9> ortsR25.28 billion *2"12

est. J4K

9> ort goods

apparel, ships, ute

and ute products,

fro%en fish andseafood, leather and

leather products,

ceramics,

pharmaceuticals,

cement, processed

food, fertili%er

Main e> ort artners

ermany1),1 ,


24/51

petroleum products,

cement

Main i! ort artners

?hina 18.9 , India

12.7 , Aingapore) , alaysia 5.7 ,

Lapan 5 *2"1"

ternal de)t

R25.) billion *41

!ecember 2"1"

est.

Pu)lic finances

Pu)lic de)t 4).7 of >! *2"12est.

RevenuesR12.)7 billion *2"12

est.

9> ensesR17.1' billion *2"12

est.

9cono!ic aidR".9'7 billion *2"11

est.

Credit rating

BB $ *domestic

BB $ *foreign

BB $*#D?

assessment

*Atandard D oorFsJ5K

Main data source( CI World :act *oo#

All values, unless otherwise stated, are in US dollars

#he econo!y of *angladesh is a rapidly developing mar6et$based

economy . I ts per capita income in 2"1" was est.


25/51

purchasing power parity . -ccording to the International onetary @und ,

Bangladesh ran6ed as the 54rd largest economy in the world in 2"1" in

terms and '7th largest in nominal terms, among the Ee/t :leven or E$11 of

>oldman Aachs and !$8 economies, with a gross domestic product of


26/51

relatively abundant water, and substantial reserves of natural gas, with the

blessing of possessing the worlds only natural sea ports in ongla and

?hittagong, in addition to being the only central port lin6ing two large

burgeoning economic hub groups A-- ? and -A:-E .

9cono!ic history

:ast BengalGthe eastern segment of Bengal , a region that is today

BangladeshGwas a prosperous region of Aouth -sia until modern times. J7K It

had the advantages of a mild, almost tropical climate, fertile soil, ample

water, and an abundance of fish, wildlife, and fruit. J7K #he standard of livingcompared favorably with other parts of Aouth -sia. J7K -s early as the

thirteenth century, the region was developing as an agrarian economy. J7K It

was not entirely without commercial centers, and !ha6a in particular grew

into an important entrepTt during the ughal :mpire .J7K #he British, however,

on their arrival in the late eighteenth*18th century, chose to develop

?alcutta , now the capital city of Cest Bengal , as their commercial and

administrative center in Aouth -sia.J7K

#he development of :ast Bengal wasthereafter limited to agriculture. J7K #he administrative infrastructure of the

late eighteenth and nineteenth centuries reinforced :ast BengalFs function as

the primary agricultural producerGchiefly of rice, tea, tea6, cotton, cane and

uteGfor processors and traders from around -sia and beyond. J7K

-fter its independence from a6istan, Bangladesh followed a socialist

economy by nationali%ing all industries, proving to be a critical blunder

underta6en by the -wami Neague government. Aome of the same factorsthat had made :ast Bengal a prosperous region became disadvantages

during the nineteenth and twentieth centuries. J7K -s life e/pectancy

increased, the limitations of land and the annual floods increasingly became

constraints on economic growth. J7K reponderance on traditional agricultural

age 3 28
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27/51

methods became obstacles to the moderni%ation of agriculture. J7K >eography

severely limited the development and maintenance of a modern

transportation and communications system. J7K

#he partition of Aouth -sia and the emergence of India and a6istan in 1957severely disrupted the economic system. #he united government of a6istan

e/panded the cultivated area and some irrigation facilities, but the rural

population generally became poorer between 1957 and 1971 because

improvements did not 6eep pace with rural population increase. J7K a6istanFs

five$year plans opted for a development strategy based on industriali%ation,

but the ma or share of the development budget went to Cest a6istan, that

is, contemporary a6istan.J7K

#he lac6 of natural resources meant that :asta6istan was heavily dependent on imports, creating a balance of payments

problem. J7K Cithout a substantial industriali%ation program or ade0uate

agrarian e/pansion, the economy of :ast a6istan steadily declined. J7K Blame

was placed by various observers, but especially those in :ast a6istan, on

the Cest a6istani leaders who not only dominated the government but also

most of the fledgling industries in :ast a6istan. J7K

Aince Bangladesh followed a socialist economy by nationali%ing all industries

after its independence, it underwent a slow growth of producing e/perienced

entrepreneurs, managers, administrators, engineers, and technicians. J8K

#here were critical shortages of essential food grains and other staples

because of wartime disruptions. J8K :/ternal mar6ets for ute had been lost

because of the instability of supply and the increasing popularity of synthetic

substitutes. J8K @oreign e/change resources were minuscule, and the ban6ing

and monetary systems were unreliable. J8K -lthough Bangladesh had a largewor6 force, the vast reserves of under trained and underpaid wor6ers were

largely illiterate, uns6illed, and underemployed. J8K ?ommercially e/ploitable

industrial resources, e/cept for natural gas, were lac6ing. J8K Inflation,

especially for essential consumer goods, ran between 4"" and 5"" percent. J8K

age 3 29
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28/51

#he war of independence had crippled the transportation system. J8K &undreds

of road and railroad bridges had been destroyed or damaged, and rolling

stoc6 was inade0uate and in poor repair. J8K #he new country was still

recovering from a severe cyclone that hit the area in 197" and cause

2'",""" deaths. J8K India came forward immediately with critically measured

economic assistance in the first months after Bangladesh achieved

independence from a6istan .J8K Between !ecember 1971 and Lanuary 1972,

India committed


29/51

troubles. J)K In the late 199"s the governmentFs economic policies became

more entrenched, and some of the early gains were lost, which was

highlighted by a precipitous drop in foreign direct investment in 2""" and

2""1. J)K In Lune 2""4 the I @ approved 4$year, R59"$million plan as part of

the overty eduction and >rowth @acility * >@ for Bangladesh that aimed

to support the governmentFs economic reform program up to 2""). J)K

Aeventy million dollars was made available immediately. J)K In the same vein

the Corld Ban6 approved R'4) million in interest$free loans. J)K In the year

2"1" >overnment of India e/tended a line of credit worth R 1 billion to

counterbalance ?hinaFs close relationship with Bangladesh.

Bangladesh historically has run a large trade deficit, financed largely throughaid receipts and remittances from wor6ers overseas. J)K @oreign reserves

dropped mar6edly in 2""1 but stabili%ed in the


30/51

@ea

r

change

Inflation

Inde>

,2333A/33

.

Per Ca ita

Inco!e

,as - of U% .

198

"2'",4"" 1).1" #a6a 2" 1.79

198

''97,418 41."" #a6a 4) 1.19

199

"1,"'5,245 4'.79 #a6a '8 1.1)

199'

1,'95,21" 5".27 #a6a 78 1.12

2""

"2,5'4,1)" '2.15 #a6a 1"" ".97

2""

'4,914,445 )4.92 #a6a 12) ".9'

2""

8 ',""4,548 )8.)' #a6a 157

ean wages were R".'8 per manhour in 2""9.

9cono!ic sectors

age 3 42


31/51

griculture

ap showing the growing areas of ma or agricultural products.

ost Bangladeshis earn their living from agriculture. J)K -lthough rice and ute

are the primary crops, mai%e and vegetables are assuming greater

importance. J)K !ue to the e/pansion of irrigation networ6s, some wheat

producers have switched to cultivation of mai%e which is used mostly as

poultry feed. J)K #ea is grown in the northeast. J)K Because of BangladeshFs

fertile soil and normally ample water supply, rice can be grown and

harvested three times a year in many areas. J)K !ue to a number of factors,

BangladeshFs labor$intensive agriculture has achieved steady increases in

food grain production despite the often unfavorable weather conditions. J)K

age 3 44
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#hese include better flood control and irrigation, a generally more efficient

use of fertili%ers, and the establishment of better distribution and rural credit

networ6s. J)K Cith 28.8 million metric tons produced in 2""'$2"") *Luly(Lune ,

rice is BangladeshFs principal crop. J)K By comparison, wheat output in 2""'$

2"") was 9 million metric tons. J)K opulation pressure continues to place a

severe burden on productive capacity, creating a food deficit, especially of

wheat. J)K @oreign assistance and commercial imports fill the gap, J)K but

seasonal hunger *U monga U remains a problem. J9K


33/51

:astern Bengal was 6nown for its fine muslin and sil6 fabric before the British

period. #he dyes, yarn, and cloth were the envy of much of the premodern

world. Bengali muslin, sil6, and brocade were worn by the aristocracy of -sia

and :urope. #he introduction of machine$made te/tiles from :ngland in the

late eighteenth century spelled doom for the costly and time$consuming

hand loom process. ?otton growing died out in :ast Bengal, and the te/tile

industry became dependent on imported yarn. #hose who had earned their

living in the te/tile industry were forced to rely more completely on farming.

=nly the smallest vestiges of a once$thriving cottage industry survived.

=ther industries which have shown very strong growth include the chemical

industry, steel industry, mining industry and the paper and pulp industry.

Te>tile sector

BangladeshFs te/tile industry, which includes 6nitwear and ready$made

garments along with speciali%ed te/tile products, is the nationFs number one

e/port earner, accounting for 8" of BangladeshFs e/ports of R1'.') billion

in 2""9. J11K Bangladesh is 2nd in world te/tile e/ports, and ?hina which

e/ported R12".1 billion worth of te/tiles in 2""9. #he industry employsnearly 4.' million wor6ers. ?urrent e/ports have doubled since 2""5. Cages

in BangladeshFs te/tile industry were the lowest in the world as of 2"1". #he

country was considered the most formidable rival to ?hina where wages

were rapidly rising and currency was appreciating. J12KJ14K -s of 2"12 wages

remained low for the 4 million people employed in the industry, but labor

unrest was increasing despite vigorous government action to enforce labor

peace. =wners of te/tile firms and their political allies were a powerful

political influence in Bangladesh. J15K

-fter massive labor unrest in 2"") J1'K the government formed a inimum

Cage Board including business and wor6er representatives which in 2"") set

a minimum wage e0uivalent to 1,))2.'" ta6a , R25 a month, up from #69'".

age 3 4'
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34/51

In 2"1", following widespread labor protests involving 1"",""" wor6ers in

Lune, 2"1", J11KJ1)K a controversial proposal was being considered by the Board

which would raise the monthly minimum to the e0uivalent of R'" a month,

still far below wor6er demands of ',""" ta6a, R72, for entry level wages, but

unacceptably high according to te/tile manufacturers who are as6ing for a

wage below R4". J14KJ17K =n Luly 28, 2"1" it was announced that the minimum

entry level wage would be increased to 4,""" ta6a, about R54. J18K

#he government also seems to believe some change is necessary. =n

Aeptember 21, 2"") then e/$ rime inister +haleda Via called on te/tile

firms to ensure the safety of wor6ers by complying with international labor

law at a speech inaugurating the Bangladesh -pparel D #e/tile :/position*B-#:W = .

Invest!ent

#he stoc6 mar6et capitali%ation of the !ha6a Atoc6 :/change in Bangladesh

crossed R1" billion in Eovember 2""7 and the R4" billion dollar mar6 in

2""9, and


35/51

entrepreneurs are 6een to invest in BangladeshFs pharmaceuticals sector

considering its potentiality in international mar6et, Aamsung sought to lease

'"" industrial plots from the e/port %ones authority to set up an electronics

hub in Bangladesh with an investment of :- president A. . @a%lul

age 3 47
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36/51

&o0ue told reporters, after the sectorFs 25 per cent growth rate was

revealed. J21K

Bangladesh +nitwear anufacturers and :/porters -ssociation *B+ :-

president d @a%lul &o0ue has also struc6 an optimistic tone. In an interviewwith


37/51

@urthermore, Bangladesh imposes no ceiling on investment in the : Vs and

allows full repatriation of profits.

#he formation of labour unions within the : Vs is prohibited as are stri6es. J22K

BangladeshFs e/ports to the


38/51

+arnaphuli, ongla , and A ,

citing the countryFs failure to meet promises made in 1992 to allow freedom

of association in : Vs.

Aylhet is fast becoming a ma or center of retailing in Bangladesh, Jcitation needed K

with many shopping centres being built by e/patriates to serve fellow

e/patriates visiting Aylhet and the emerging middle class. any of these

developments har6 bac6 to Britain .

Overvie+

#he area of >ulshan is a commercial hub of the country

age 3 5"
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39/51

+arwan Ba%ar is home to many of BangladeshFs important offices

Ba%aars in Bangladesh are popular trading places for everyday

household necessities.

Bangladesh has made significant strides in its economic sector performance

since independence in 1971. -lthough the economy has improved vastly in

the 199"s, Bangladesh still suffers in the area of foreign trade in Aouth -sian

region. !espite ma or impediments to growth li6e the inefficiency of state$

owned enterprises , a rapidly growing labor force that cannot be absorbed by

agriculture, inade0uate power supplies, J2'K and slow implementation of

economic reforms, Bangladesh has made some headway improving the

climate for foreign investors and liberali%ing the capital mar6ets S for

e/ample, it has negotiated with foreign firms for oil and gas e/ploration,better countrywide distribution of coo6ing gas, and the construction of

natural gas pipelines and power stations . rogress on other economic

reforms has been halting because of opposition from the bureaucracy, public

sector unions, and other vested interest groups.

age 3 51
http://en.wikipedia.org/wiki/Bazaarhttp://en.wikipedia.org/wiki/South_Asiahttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/Economy_of_Bangladesh#cite_note-Bangladesh_Power_Demand-25http://en.wikipedia.org/wiki/Investmenthttp://en.wikipedia.org/wiki/Capital_markethttp://en.wikipedia.org/wiki/Natural_gashttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Power_stationhttp://en.wikipedia.org/wiki/File:Bd_bazaar.jpghttp://en.wikipedia.org/wiki/File:DHAKA.jpghttp://en.wikipedia.org/wiki/Bazaarhttp://en.wikipedia.org/wiki/South_Asiahttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/State-owned_enterprisehttp://en.wikipedia.org/wiki/Economy_of_Bangladesh#cite_note-Bangladesh_Power_Demand-25http://en.wikipedia.org/wiki/Investmenthttp://en.wikipedia.org/wiki/Capital_markethttp://en.wikipedia.org/wiki/Natural_gashttp://en.wikipedia.org/wiki/Pipeline_transporthttp://en.wikipedia.org/wiki/Power_station


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City


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I !? is the first private sector development finance institution in Bangladesh.

http HHwww.ipdcbd.com

a!una =td

-ppollo Ispat ?omple/ Ntd. *-I?N is the largest ?.I. *?orrugated Iron sheet

manufacturing company in Bangladesh.

http HHwww.appolloispat.com

R' 'B Cera!ics ,*D. ,Pvt'. =td'

.-.+ ?eramics offers one of the most comprehensive product lines in the

ceramic tile industry, all manufactured by the company.

http HHwww.ra6ceramics.com

Talu#der roup was established in 2""2 as a pioneer organi%ation in

Bangladesh. r. #alu6der @arid -hmad, being the Neader of the >roup too6up the challenges of bringing the necessary advanced technology to the

Bangladeshi companies.

http HHwww.talu6dergroup.com.bd

age 3 5'
http://www.velki.com/hit.asp?id=12952http://www.velki.com/hit.asp?id=13317http://www.velki.com/hit.asp?id=10935http://www.velki.com/hit.asp?id=14409http://www.velki.com/hit.asp?id=12952http://www.velki.com/hit.asp?id=13317http://www.velki.com/hit.asp?id=10935http://www.velki.com/hit.asp?id=14409


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)dul Mone! =td'

- group of companies with construction unit, beverage unit, ice cream D mil6

unit, -m sugar refinery ltd, am pharma ltd, igloo foods unit.

http HHwww.amlbd.com

/fittings

-$=ne olymer Ntd. is yet another glorious contribution of the century old

-nwar >roup of Industries in strengthening the developing industrial base of

Bangladesh. olymer pipe oints.

http HHwww.a1fittings.com

roup through which we tend to inform

you on various aspects of the >.#.?. >roup.

http HHwww.gtc$group.net

%ino)angla Industries =td

?hina$Bangladesh oint$venture company, has grown to become the largest

manufacturer and e/porter of @IB?s *big bag and woven polypropylene

*C bags in Bangladesh.

http HHwww.sinobangla.com

Bangladesh will have within a decade a si%able industrial sector where

manufacturing will account for at least 2' per cent of the >! and at least

2" per cent of the employed wor6force. #his will mean a considerable rise

from the figure of 1" per cent around which the sectorFs share in >! and

employed population have hovered for most of the past two decades.age 3 5)
http://www.velki.com/hit.asp?id=10097http://www.velki.com/hit.asp?id=7683http://www.velki.com/hit.asp?id=13575http://www.velki.com/hit.asp?id=8746http://www.velki.com/hit.asp?id=10097http://www.velki.com/hit.asp?id=7683http://www.velki.com/hit.asp?id=13575http://www.velki.com/hit.asp?id=8746


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- vibrant and dynamic private sector will be the principal actor in

BangladeshFs industrial arena. #he industrial sector of Bangladesh will be

competitive in the liberali%ed internal mar6et as well as in the e/ternal

mar6et. #he industrial sector of Bangladesh shall have a dominant e/port

orientation.

#he goal of e/ternal competitiveness implies the pursuit of industriali%ation

in accordance with the dynamic comparative advantage of the economy.

>iven BangladeshFs resource endowment, the principle of dynamic

comparative advantage means production of labor intensive manufactures

with s6ill up$gradation and productivity growth as its cutting edge. #his

however, does not preclude the possibility of Bangladesh having a nichehigh$tech industrial sub$sector that may be e/ternally competitive.

!ispersal of small and medium industries will constitute an important

element in the industrial policy approach. Industrial development will be

sustainable from the point of view of environmental concerns and resource

availability.

Industrial olicy 1999 aims at addressing these concerns building on earlierefforts and gains towards industriali%ation of Bangladesh economy.

IN:R %TRUCTUR = : CI=ITI9% ND UTI=IT@ %9R IC9% IN

* N


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investment, both foreign and domestic. #he issues relating to infrastructural

facilities and utility services have been given high priorities in those policy

reforms and implementations.

COMMUNIC TION(

#he transport sector of Bangladesh consists of a variety of modes. #he

country being a flat plain, all three modes of surface transport i.e. road,

railway, and water are widely used in carrying both passengers and cargo.

ore than half of Bangladesh has access to an all$weather hard surface road

within three miles distance. #here has been a dramatic e/pansion of roadnetwor6 in recent years. In 1997, the total length of paved road under the

oads and &ighways !epartment stood at more than 2",""" 6ilometers. It is

increasing over time. It is estimated that mechani%ed road transport carry

about 7" of the countryFs total passenger and cargo volume. orts and

important business centers are well connected by roads and highways.

In recent years, construction of a number of bridges such as the

Bangabandhu Lamuna Bridge, eghna Bridge, eghna$>umti Bridge,

Bangladesh$?hina @riendship Bridge, Ahambhugan Bridge and ahananda

Bridge have been completed. #he 5.8 6ilometer long Bangabandhu Bridge

which has been opened to traffic in Lune, 1998, is the eleventh longest in the

world. It has established a strategic lin6 between the :ast and Cest of

Bangladesh, has integrated the country, is generating multifaceted benefits

to the people and promoting inter$regional trade. -part from 0uic6

movement of goods and passenger traffic, it is facilitating transmission of

electricity and natural gas and has integrated the telecommunication lin6.

-bout 42 of the total area of Bangladesh is effectively covered by the

railways. It connects all the administrative and business points of the

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country. ailway container service from ?hittagong port to !ha6a are

available.

-bout two$thirds of Bangladesh is a wetland laced with a dense networ6 of

rivers, canals and cree6s. #he navigable waterways vary between 84726ilometer during the monsoon to '2"" 6ilometer during the dry season.

Bangladesh Inland Cater #ransport -uthority has been established by the

government for maintenance of navigability of ports and channels.

#he entire coast along the Bay of Bengal is 71" +ilometer long. #here are

two ma or ports in the country. ?hittagong ort, the oldest port, has been an

entry point for at least 1""" years. #he ongla ort in +hula region serves

the western part of Bangladesh. CorldMs reputed shipping lines are operating

through these two ports.

#here are now 11 operational airports in Bangladesh. =f these, the airports

at !ha6a, ?hittagong, and Aylhet serve international routes.

W T9R(

Cater is supplied by the Cater and Aewerage -uthority *C-A- in the

metropolitan areas. ;ery high priority is attached regarding availability of

water in industrial areas.

< %(

Eatural gas supply is available in ma or industrial areas.

T9=9COMMUNIC TION(

?omprehensive telecommunication services such as fully automatic tele/,

fa/, e$mail, internet, telephone including international direct dialing are

available.

9=9CTRICIT@(

In Bangladesh, electric power is generated in hydro, steam, gas$turbine, and

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PO=IC@ R9COMM9ND TION% ND CONC=U%ION (

=ur regression results support the findings of Islam and Ifthe6haru%%aman

*199) , which states that there is no significant relationship between the

growth rate of e/port and the growth rate of gross domestic product ofBangladesh. =ur pairwise >ranger causality test results also support the

findings of Islam *1998 . Islam finds that the growth of total e/port >ranger

causes growth of >! positively and significantly but not vice versa.

-lthough amun and Eath *2""' find no causal relationship between e/port

growth and industrial growth, our estimation results show that growth rate of

e/port is >ranger caused by the growth rate of industry value added but not

vice versa.

#herefore, the policy implications are simple from these results. #he results

clearly show that only import andHor e/port cannot contribute to the

economic growth unless industrial sector is ta6en into account. #he results

also show that >! will grow if the import demand is derived from the e/port

and industrial sectors. #herefore, diversification of e/ports, e/port

promotion, careful import liberali%ation strategies, foreign and domestic

investment, favorable infrastructure and industriali%ation policies can lead torapid economic growth in Bangladesh. #rade policies should focus on import

liberali%ation. #a/, tariff and non$tariff barriers among the trading countries,

especially in the Aouth -sian region should be reduced. Bangladesh suffers

from a huge trade deficit with the neighboring country, India. #he low level of

age 3 '2

;isit =ur Corld


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Industrial Development of Bangladesh

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