There is a lack of initiative as far as the role of the government is concerned
Md Ashikuzzam, owner of Hand Made BD, a manufacturer of diversified jute products, started his business six years ago aiming to become an exporter.
The yearly turnover of Hand Made BD stood at about Tk1.6 crore in 2018, of which 99% came from domestic sales. But Asihikuzzaman’s dream of becoming an exporter faded as he could not find buyers for his products.
Like Asihik, a good number of small entrepreneurs in the emerging jute-diversified sector are struggling to establish networks with buyers as they are unable to take part in international expositions to connect with buyers due to associated costs.
Besides, they lack facilities like research and development, and expertise to connect with global buyers of diversified jute products.
As a result, despite high demand in international markets and adequate production capacity domestically, Bangladesh is yet to tap the export market for jute and diversified jute goods, and are yet to utilize their full potential.
This means there is a lack of initiative as far as the role of the government is concerned, to explore new markets and establish connections with buyers and start-up exporters.
“Leaving my job in 2012, I started my business with a vision of exporting diversified jute goods to global markets to bring home the glory of the golden fibre,” Md Ashikuzzam told the Dhaka Tribune.
“Across the globe the demand for diversified jute goods is on the rise due to people’s growing consciousness about the environment and pollution. And it was the core spirit of my inspiration.”
Ashik displayed various such products at the two-day fair on the occasion of National Jute Day 2019, held at the Bangabandhu International Conference Centre (BICC) on Thursday.
“In the years of my journey, I have been able to win the hearts of domestic customers and sometimes from neighboring countries such as India and Pakistan. But I am yet to reach global buyers in Europe and other countries where diversified jute goods have large markets,” said Ashik.
“This is because of my inability to participate in international shows to display my goods in a bid to attract buyers, as it is too expensive,” he added.
“Bangladesh has a wide range of products, and price is not a matter in the global market as there is a huge demand for jute diversified products in the global market. Problems lie in finding buyers,” Mohammad Ali Khan of Hand Touch told the Dhaka Tribune
It costs Tk7-8 lakh to participate in expos in the EU, the Americas, or Japan. It is very difficult for a small entrepreneur to afford, said Ali.
Though the Export Promotion Bureau (EPB) bears some costs, it is inadequate for the actual costs involved, he said.
To tap the export market, Ali urged the government to provide financial support in exploring markets and finding customers.
According to Export Promotion Bureau (EPB) data, in July- February of the current fiscal year, Bangladesh earned $560.56 million from jute and jute goods, down by 24.36% from a year ago.
Of the total, jute goods fetched $ 86.85 million, jute yarn and twine $341.25 million, and jute sacking and bags fetched $62.64 million, and other goods, $70 million.
Since the government is placing emphasis on the development of the jute sector, we will launch research on potential markets to learn about demand. Based on the findings, steps shall be taken to give opportunity to display goods at foreign expos, Commerce Secretary Md Mofizul Islam told the Dhaka Tribune.
According to Jute Diversification Promotion Center (JDPC), there are 232 items of diversified jute goods, including jute bags, purses, bed sheets, sofa covers, blankets, curtains, floor mats, sweaters, blazers, gents and ladies shoes, sarees, ornaments and ornament boxes, ladies three pieces, and home decor items.
Meanwhile, some entrepreneurs are indirectly exporting through big exporters.
“I have no direct connection with buyers. So I export through a third party,” said Shaharia Sultana, owner of Khulna Jutex.
How to grab market share
In the global market, the demand for natural fiber products is growing fast and Bangladesh can take the lion’s share of it as the country has the capacity to meet the demand for raw materials.
To this end, the government has to provide policy support to promote the sub-sector of jute, sector people suggested.
“Use of eco-friendly and natural fiber products is becoming more popular with consumers due to consciousness about the environment as the European union is going to impose a ban on the use of plastic from next year, and Australia already banned plastic use in July last year,” Rashedul Karim Munna, secretary general of Bangladesh Jute Diversified Product Manufacturers and Exporters Association (BJDPMEA), told the Dhaka Tribune.
In reaping the benefits from these developments, Bangladesh has to concentrate on jute research to broaden its diversification list and increase quality, said Rashedul, managing director of Creation Jute Limited.
In addition, financial support for exploring markets is necessary as the number of entrepreneurs and market size have increased, while the incentives have remained the same.
“ I suggest the government take initiatives for creating a network between buyers and makers and establish product branding for global consumers,” he added.
However, experts think the government should organize international expositions in Dhaka so that small entrepreneurs can join and display their products to attract buyers.
“It is not possible for a small maker to join an expo in a foreign country. So arranging expositions in the country can enable them to showcase their jute diversified products,” former caretaker government advisor, AB Mirza Azizul Islam, told the Dhaka Tribune.
On top of that, the government should rethink incentives and create more opportunities for the emerging export-oriented sector as it would reduce dependency on a single sector, said Islam.