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(A promising sector)
Bangladesh is striving hard to emerge as a middle income country by the year of 2021.in this heavily populated country, the SMEs are also considered as the backbone of the national economy. Facing the challenge of creating large-scale employment opportunities, increasing percapita income, reducing poverty and social inequality, the development of SME sector has been brought to the centre stage of government pro-poor development strategy.
Definition of small & medium enterprise:
Small manufacturing industry: Fixed investment less than Tk. 15 million, exclusion
of land and factory building
Small non-manufacturing industry: less than 25 full time employees. Medium manufacturing enterprise: Fixed investment greater than Tk. 15 million but
less than Tk. 100 million.
Medium non-manufacturing enterprise: Less than 100 fulltime employees.
Advantages provided by the Govt.:
Bangladesh government gives various advantages to flourish the SME sector of Bangladesh. For this a separate limited company has been set up for the improvement of SME named SME Foundation. Also under the ministry of industries there is corporation named Bangladesh Small & Cottage Industries Corporation (BSCIC). Above mentioned company does various things for promoting SME and help entrepreneurs.
The main objectives of SME Foundation are:
1. 2. 3. 4. 5. Implementing SME Policy Strategy adopted by the Government of Bangladesh. Recommending SME friendly policies to different government ministries and agencies. Providing business support services to the SME entrepreneurs. Providing information and proper guidance for establishing new SMEs. Conducting sectoral study to ensure availability of latest information, identify challenges and recommend preventing measures. 6. Operating credit wholesaling programs for the SMEs through different banking and nonbanking financial institutions. 7. Conducting training programs to create skilled labor for different SME sub-sector based on their demands. 8. Technology development, adopting new technology, conducting reverse engineering and supporting SMEs to get quality certifications. 9. Supporting SMEs in marketing their products and promotion of services. 10. Bringing women entrepreneurs into the mainstream of development and helping them to achieve economic self dependency. 11. Assisting SMEs in creating institutional bondage with foreign companies for capacity building, technology transfer and improving productivity. 12. Training up and motivating SMEs in using ICT tools for more productivity and improving quality.
Vision and mission of SME Foundation:
Vision: Fostering industrialization through SME promotion for employment generation, economic development finally poverty alleviation of Bangladesh. Mission: Undertake and implement multi sectoral action plan for proper growth of SMEs and make them competitive in the free market economy.
The vision and mission of BSCIC:
Vision: To be the leading Organization in Developing Small, Medium & Cottage Industries that contribute to the economic growth and to create vibrant and resilient SMCIs that enhance Bangladesh is competitiveness in the world market. To transform SMCIs into an economic powerhouse of the country by 2025. Mission: To materialize the vision following mission may be followed: i) Providing latest technical and managerial assistance to enterprises and communities for the improvement of productivity, quality and environment. ii) Promoting strategic alliance with clients as well as national and international professional bodies in pursuit of economic development. iii) Molding a work place that encourages creativity, innovation, professional growth and positive value. iv) To instill and eventually ingrain deeply the concept of learning organisation into SMCIs and encourage them to be export-oriented. v) Sharing the rewards of own endeavors with our communities, customers, employees, suppliers, management and our stakeholders. They help small and medium enterprise entrepreneur in the above mentioned way.
Services provided by BSCIC:
Entrepreneurship development through counseling and training. Provide infrastructural facilities by establishing Industrial Estates. Extend credit facilities to the entrepreneurs from its own fund and also through banks and financial institutions; Preparation of Project Profile and project appraisal proposal. Provide technical and consultancy services for establishing new industrial units and quality improvement of SCI products; Development and distribution of new designs and prototype Innovation and adaptation of appropriate technology in the SCI sector.
Special interest for women entrepreneur: Women can enjoy special interest rate of 10% instead of 17-18%. If the industrial undertaking is set up elsewhere in the country. as like: 1. Recommendation for import entitlement of raw materials and packaging materials. production and marketing of SCI. For other parts of Bangladesh exemption is for 7 years where for the 1st 3 years it is 100%. 3. For Dhaka. Collect compilation and dissemination of technical and other information leading to investment. and for the last year 25% of tax is exempted. Refinancing loan from Bangladesh bank: Private banks can refinance the given amount of loan from Bangladesh bank in case of SME loan. Other pre and post investment counseling. Registration of small and cottage industrial unit. 2. Chittagong total 5 years of tax holidays are given where for first two years 100%. Advantages provided by bank/financial institution: Steps/measures taken by Bangladesh bank for SME development: 1. Regulatory Functions. 4. Such allowance is available at the rate of 100 per cent of the cost of the machinery or plant if the industrial undertaking is set up in the areas falling within the cities of Dhaka. an indicative target for SME loan disbursement has been set For 2010 by the banks and financial institutions considering SME development as one of the most important development agenda of the country. Tax holiday facilities: For a time period tax is exempted. According to the target. Conduct research. Accelerated depreciation: Industrial undertakings not enjoying tax holiday will enjoy accelerated depreciation allowance. Narayangonj. medium and women entrepreneurs. then for the next two years it is 50%. region wise & sector wise. 2nd 3 years it is 50% and for the last year the exemption is 25%. For the first time in Bangladesh. 2. SME loan shall be disbursed to the small. studies and survey in the SCI sector. . Recommendation for exemption of duties and taxes. Besides government give some other advantages too. accelerated depreciation is allowed at the rate of 80 per cent in the first year and 20 per cent in the second year. Chittagong and Khulna and areas within a radius of 10 miles from the municipal limits of those cities. Following the 'Area Approach Method' banks/financial institutions will try to attain their indicative targets separately by dividing it as branch wise.
000 (Fifty lac).For small entrepreneurs credit limit will be ranged from Tk. 50. 5. many other govt. in order to involve banks in financing priority sector like SME and Agriculture’.For more participation of women entrepreneurs in industrial development of the country and for conducting business activities by women entrepreneurs in large number.Banks and financial institutions may sanction up to Tk. 50. 11. bank/financial institution will inform Bangladesh Bank sector/sub-sector wise rate of interest immediately and ensure disbursement of refinanced fund to the clients (women entrepreneurs) at Bank rate +5% interest. Branch wise list of ‘ Women Entrepreneurs’ Dedicated Desk ‘ should be sent to SME and Special Programmes Department of Bangladesh Bank within two months from the date of declaration of this policy and programme. 6.00. group security/social security may be considered.Training programs shall be arranged for the entrepreneurs. . Each bank/financial institution shall follow a separate business strategy in financing SME loan with least formalities in executing documentation to ensure easy and speedy loan sanction and disbursement process . and private banks give different advantages for SME.000 to women entrepreneurs against personal guarantee. 10. License for New Branches will be issued for financing the priority sectors like SME and agriculture from 2010 in the name of ‘SME/Agriculture Branch’ instead of ‘SME Service Centre. 25.000 (Fifty thousand) to Tk. 7.3. In that case. 8. provide them training on SME financing and suitably appoint a lady officer as chief of dedicated desk. priority shall have to be given to potential women entrepreneurs in respect of SME credit disbursement. 9.The success in SME loan disbursement will be considered as yardstick for further approval of new branches of the concerned bank. Besides these. 12.00. However. 4.Priority shall be given to small entrepreneurs.Each bank/financial institution shall fix the interest rate on SME loan sector/subsectorwise.Banks & Financial Institutions shall put highest priority in receiving loan application from small and medium women entrepreneurs and settle the loan disbursement process within very reasonable time from the date of acceptance of the application.Each bank and financial institution shall establish a separate ‘Women Entrepreneurs’ Dedicated Desk’ with necessary and suitable manpower.
Clothing and shoe business. Warehouse and container service Bus/Trauck body building Oil and pulse mill GI pipe producing industry Manufacturing of cement pillar. Horticulture. Mobile set and accessories business Electronics business. Fertilizer business. restaurant and tourism. 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 98 99 100 101 102 103 104 Leather and leather products Electronics. Frozen food. documentary film. Renewable energy such as. Transport and communication. Rice mill/Auto rice mill. Nakshi Kanta and handloom. Local transport. Forestry and furniture. Old Iron goods. Hotel. Chatal business Trading. Cinema hall. windmill. Entertainment such as. Ginning and baling. Ice mill. Flattened and fried rice production by machine. Stuffed toys. Drug house/Pharmacy. Jute trading. Herbal medicine industry Jute goods and jute mixed goods. Mobile phone accessories Printing and packaging. solar power. Light engineering industry Plastic industry. Agro-based activities such as fishing. Rod and cement trading Hardware business Crockery business. and marketing.Important sectors of SME: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 63 64 65 66 67 68 69 Agro-based and agro-processing industry. construction industry and housing Hospital and clinic. Commercial plantation Photography. Computer software and ICT goods. floriculture & flower marketing. Various small business. Bakery. Knowledge society with high quality merit and efficiency. Agro-tools making and marketing. Cyber cafe. Hatchery. Laboratory. Grocery and chaff goods business LP gas businesses. Jewellery. Cosmetics and toiletries Handicrafts. Artificial flower making Optical frame manufacturing Silkworm and silk industry. IT-based activities. Cold storage Construction business such as. Mini sugar mill. Wholesale and retail shop. Agro machinery/tools business. Telecommunication. fish preservation. Fishing boat building. cinema and DVD production. Food seed preservation and marketing. Phone-Fax. Dry fish processing. Iodized salt production. Molasses production Catechu production . Stationery goods industry.
Battery manufacturing. Seed production through tissue culture. Computer training school. pangas). lachha & chanachur production. Nursery. Dairy and fish feed production. Saw mill. 124 Production of lime from oyster. gymnasium. Brick field. Diagnostic centre Digital color lab. Boat industry such as. Sand & stone business Wood & steel goods business Paddy-rice business. Charcoal production Storage for potato seeds. easy bike (Jessore). Solar electricity plant . telapia. IPS production Tribal handloom and specialized handloom (Komor tant). Marketing of khadi goods. Mushroom. Community centre. Interior and exterior decoration Light engineering workshop. lichi. Biogas plant. Cable operators Electricity distribution produced by generator. 128 129 130 131 132 mango juice. Khadi industry. passenger carrying small boat building. 125 Pottery. Potato tissue culture. Environment friendly transport (battery batteryoperated) such as. Sweetmeat production Fish cultivation (shrimp. Nakshi Kanta and handloom Cane matt (Shital pati).70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 Tailoring. lotcon etc. Bamboo and cane goods production Boutiques. 127 Fruit processing industry such as. Agor and candle light production Spice grinding Biscuit factory. Exportable soiled tali production Food processing 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 Hosiery Welding industry. Call centre. Saloon and beauty parlour. Production of juvelile fish (Reno pona). 122 Railway slipper manufacturing 123 Sanitary goods manufacturing. 126 Tea industry. Semai. Small amusement park. Bronze & brass industry Partex industry.
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