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BBS Survey 2019: Number of small industries up, large and medium ones down

  • Published at 09:50 pm May 30th, 2019
BBS
Collected

Number of large industries fell by 16.70% to 3,031 in 2019, from 3,639 in 2012

Despite having a small contribution to the GDP, the number of small industries has seen a sharp rise by 50.37% to 23,557 in 2019, compared to 15,666 in 2012. 

However, the number of large and medium enterprizes in the country declined significantly in 2019, according to a provisional estimate of Bangladesh Bureau of Statistics (BBS).

As per the preliminary findings of the bureau's “Survey of Manufacturing Industries”, the number of large industries fell by 16.70% to 3,031 in 2019, from 3,639 in 2012, while medium enterprises  saw a sharp decline by 50.61% to 3,014 in 2019, from 6,103 in 2012.

Besides, micro manufacturing establishments shrank by 4% to 16,689 from 17,384 in 2012, the survey data says.

In the previous BBS survey report of 2013,  the total number of industrial units in the country was 42,792, which stood at 46,291 in the latest study.

A factory employing 250 or more people is defined as large, while a medium factory has 100 to 250 workers. A small factory employs 25 to 99 people. 

Lizen Shah Nayeem, BBS deputy director and the focal point of the study, said that small industries have increased as a good number of micro entrepreneurs graduated to small enterprises.

More small entrepreneurs are now seen in garment embroidery and printing, block printing, and toy manufacturing sectors, he added.

According to BBS data, in  2017-18, manufacturing industries contributed 22.85% to the GDP, which was 21.74% in the previous fiscal year.

Large and medium industries contributed 19.07%, while small industries contributed 3.78% to the GDP.            

Talking to Dhaka Tribune, economists and business people blamed sluggish private sector investment for the situation.

“After the Rana Plaza incident, the apparel sector had to go through a remediation process to ensure safe workplaces for workers, and the industry had to spend lots of money,” Abdus Salam Murshedy, a former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told Dhaka Tribune.        

As a result, the sector has not seen new investment or expansion due to fund shortages, while a good number of factories shut down for their failure to become  compliant, said Murshedy, who is the managing director of Envoy Textile.         

But it is a positive indicator that there is a rise in the number of small industries, which will turn into large industries in the future, he added.

Economists also echoed the industry people and blamed stagnant investment in the private sector for the dismal situation of large and medium industries.

“One of the major reasons for the downtrend in large industries is stagnant private sector investment, which has continued in the past few years,” South Asian Network on Economic Modeling (Sanem) Executive Director Selim Raihan told Dhaka Tribune.

Besides, after the Rana Plaza incident in 2013, the apparel sector went through restructuring and there was no new investment, said Selim.

“Besides, Bangladesh did not create new sectors beyond RMG,” said the economist.

Meanwhile, the survey findings also showed that  employment in the small industry sector rose to 11.28 lakh, which was 7.38 lakh in 2012.

But employment in large industries increased to 40.27 lakh, which was 29.64 lakh in 2012. However, overall employment rose to 58.80 lakh, which was 50.15 lakh in 2012.

A sample of 8,000 industries in 64 districts of the country were taken for the survey. The final findings are expected to be published by September, BBS sources said