The light engineering sector will get a boost from a new policy which planned to address challenges that were hindering its growth.
Sources said an 11-point plan would help develop infrastructure, industrial park, easy financing and industrial incentives for the sector by 2027.
It includes time-bound measures to deal with challenges through research, preparing a list of potential products, setting up clusters, ensuring quality, developing an investment-friendly environment, market expansion and technological advancement.
The policy also intends to help the sector thrive to attain the goal of increasing the industrial sectors' contribution to 40 per cent by 2027, added the sources.
Local light engineering sector supplies capital machinery and spare parts. It also provides repairing services to local industries, thus helping the industrial sectors grow, read the policy.
It has proposed to generate venture capital so that new entrepreneurs can get easy access to financial support in order to undertake innovative projects.
According to the policy, a special low-interest fund would be generated to encourage the use of modern technology in the local light engineering sector.
On September 29, the Industries Ministry published the policy through a gazette notification.
Earlier on August 22, the cabinet gave its nod in a meeting.
Light engineering is considered as a thrust sector and a highest priority sector in the Export Policy 2021-24.
Factors like outdated technology, low productivity and lack of industrial facilities have been identified as major challenges, thereby hindering export growth of the sector, according to industry insiders.
They also cited poor quality of products, lack of access to finance, high price and unavailability of quality raw materials, and lack of policy support as challenges facing the industry.
According to a latest Rapid survey, most conventional machines used by manufacturers are too old as some are found to be used for over 30 years now against their average age of 20 years.
It also finds that the industry falls short of ensuring quality, primarily because of substandard raw materials, outdated equipment, untrained labour and poor-quality designs.
The Bangladesh Institute of Development Studies (BIDS) in its latest report identified an estimated 33.6% skill gap in the sector.
The sector has developed largely as a backward linkage to supply industrial machinery and spare parts to agriculture, printing and packaging, construction, transport, apparel, cement, paper, jute, textile, sugar, food processing, railway, and shipping sectors.
Human resources will be developed within the next two years by providing required training and taking other measures, according to the policy.
It also intends to develop "Made in Bangladesh" brands both in local and global markets by ensuring quality and compliance standards by 2025 and helping increase export earnings too.
According to Export Promotion Bureau (EPB) data, Bangladesh fetched $795.63 million from engineering product exports in FY22, which was $529 million in FY21.
In the first three months of FY23, it earned $144.39 million marking 21.43% growth, the data showed.