BUS203 WRITE-UPS

BUSINESS ENVIRONMENT

Submitted to
Mohammad Atiqul Basher
Lecturer
BRAC Business School
BRAC University

Submitted by
MD. Samiul Hasan Aric
ID: 18104205
BRAC Business School
BRAC University
Write-up 1

Fourth industrial revolution and its impact in Bangladesh

Researchers are trying to make stakeholders aware about Fourth Industrial Revolution concept
and inspiring entrepreneurs to adopt newer technologies to get advantages out of it. They are
prompting that businesses are to adopt fourth & fifth generation technologies to remain them up
to date with contemporaneous market demands. Seminars, conferences and round table
discussions are being organized by different stakeholders and organizations on Fourth Industrial
Revolution & its problems and prospects.

Fourth Industrial Revolution is much discussing now a days, scholars are describing concurrent
innovations like artificial intelligence, robotics technology, 3D printing, block chain and big data
etc. It is very indispensable for the industrialists to adopt newer technologies, use newer
machineries and produce products or provide services according to the shifting demand of
consumers.

Now coming to the context of Bangladesh, it has long been a story of the aspiration, elasticity
and innovation of millions of young women and men across villages and towns. In my brief,
five-decade history, the country has constantly battled against natural and man-made disasters,
and yet has sustained high economic growth. Today, we are one of the fastest growing
economies globally, expanding at over seven percent annually. During the past decade, under the
stewardship of Prime Minister Sheikh Hasina, we also significantly reduced poverty and
inequality. The Fourth Industrial Revolution coincides with the period when Bangladesh
transitions towards a developed country. By 2030, around half of Bangladesh will be living in
urban areas. These people will have the demand of all kind of goods and services that we cannot
predict today by our own. Bangladeshi industries and our inclination to adopt Fourth Industrial
Revolution technologies, major Bangladeshi business sectors are readymade garment, leather and
leather goods, plastics, light engineering, agro processing, electrical and electronics, fashion
designing and personal effects, IT and ITES, ship building, tourism, textiles, ceramics,
pharmaceuticals, infrastructure development, healthcare and diagnostics etc. Bangladeshi export
largely depends upon a single sector i.e. readymade garment during last three and more decades.
It is yet to get a second export earning sector during this long three decades. Few other sectors
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like leather goods, pharmaceuticals; Outsourcing, human resource export, and agro processing
have potentials to become major export earners. But none of these are becoming so bold like
readymade garment. Local researchers are advising government and private sector to look into
the matter of differentiating export basket but up till now to select the right products for export
diversification.

If we look at the history of industrialization in Bangladesh, we would get existence of 177

naturally grown SME clusters throughout the country. All of the SME clusters are established by
following success stories of one or limited individual initiatives. All of the clusters are using
mainly similar and technologies of the second or first IR era with minor modification or as it is.
Consequently, products quality, design and productivity of the industries located in the SME
clusters are very old fashioned and poor performing. As a result products of these clusters are
fighting to uphold existing local market against imported products of the same sector. Because
local entrepreneurs don’t know where appropriate refining technology is available to make
locally produced coconut oil clear and transparent like the imported one. But with passage of
time, improved quality imported coconut oil entered into the market and they became
uncompetitive. As example, the Kumarkhali Textiles Cluster at Kustia is a concentration of more
than ten thousand hand and power materializes producing various types of old fashioned textiles
products including bed sheet, bed cover, Lungi etc. There are three to five factories has become
medium sized here in this cluster. But same designed products are being produced by all of the
factories during last half of the century. Some of the entrepreneurs in Kumarkhali dreams to
export their products to European markets but they have no idea about machineries which are
appropriate to produce export oriented product.

Not only the above mentioned clusters but also the entrepreneurs of the country are also
suffering from lack of information like what should be the appropriate product to produce, what
are the relevant machineries to produce their selected products? Where these machineries are
available to purchase? How to collect relevant raw materials? How to procure an appropriate
machine and install it in their factory premises? There are many online portals like Indiamart,
Alibaba, Amazon etc. This portals helps to bridging up potential entrepreneurs and machine
suppliers in India, China and many other countries. But these types of platforms are till absent in
Bangladesh.

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The Bangladesh Center for Fourth Industrial Revolution is a center of excellence for Engaging
politics, business, media, civil society and academia for shaping the future of industry and
society in the context of globalization 4.0. The BD4IR’s mission is to develop capacity, conduct
research, map challenges and opportunities and develop technical cooperation to maximize the
benefits and minimize the risks of Fourth Industrial Revolution in Bangladesh. Based on their
primary assessment, they emphasizes the following 14 strategic areas, which curate, align and
advance the efforts of the most nationally relevant priorities that need to address 4IR to shaping
the future. 1.Shaping the Future of Consumption, 2.Shaping the Future of Digital Economy and
Society, 3.Shaping the Future of Economic Progress, 4.Shaping the Future of Education, Gender
and Work, 5.Shaping the Future of Energy, 6.Shaping the Environment and Natural Resource
Security, 7.Shaping the Future of Food Systems, 8.Shaping the Future of Financial and Monetary
Systems, 9.Shaping the Future of International Trade and Investment, 10.Shaping the Future of
Health and Healthcare, 11.Shaping the Future of Long-term Investing, Infrastructure and
Development, 12.Shaping the Future of Information and Entertainment/Society, 13.Shaping the
Future of Mobility, 14.Shaping the Future of Production.

Therefore number of new entrepreneurship development is less than the expected number in
Bangladesh. Government and researchers issues can emphasis on such practical barriers we do
have to make our micro and cottage scaled potential entrepreneurs functional in the ground, who
could be graduated into small, medium as well as larges scaled corporations in coming future.
Therefore with talk shows in the media we need practical initiatives to play role of business
intermediary organizations or supporting hand for the entrepreneurs to procure and install
appropriate technologies in respective fields.

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Write-up 2

Industrial policy of Bangladesh

Bangladesh is a developing country. It needs a strong yet practical industrial policy to see its
economic activities bringing the desired results. The current government is providing the needed
course of actions to achieve holistic economic development in all the sectors of Bangladesh. To
accomplish the goals, no doubt government faces resource limitations and many other
unbearable factors including political mayhem. The government has understood the importance
of the private sector. Sheikh Hasina government is providing an all-out support to all type of
private entrepreneurs, no matters he is big, small or medium. This support has brought dynamism
in both private and public sector of Bangladesh. So, examining various aspects of
industrialization and its impact on overall economic activities is very essential, due to this.

The private sector is contributing noticeably in the industrialization of the country. The
government has been facing the challenges of the free market economy, intense global
competition and the most heard terms now-a-days, globalization. Private ownership and
management of industrial enterprises has been now accepted by the government as one of the
main leading forces in achieving economic growth. Meanwhile, the government has also brought
about many productive and timely enhancements in the running of businesses. Private
entrepreneurs can seize opportunities of establishing and running industrial enterprises profitably
and freely because of liberalization of trade done by the government. Though government is
taking initiatives, more efforts are needed to reduce poverty. Government needs to emphasize on
establishing agro based industries to raise agricultural production. It will generate employment
opportunities as well as will be great step to reduce poverty. On the other hand, it will balance
the pricing of agricultural products. Initiatives should be taken to set up small, medium or big
agricultural industries across the country. With these objectives in mind, government has
radically reshaped the industrial policy.

There are organizations to provide institutional, administrative and infrastructural facilities and
support, such as the Bangladesh Standards and Testing Institution, Bangladesh Industrial
Technical Assistance Center, Bangladesh Institute of Management, Bangladesh Small and

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Cottage Industries Corporation, the National Institute of Textile Training, Research and Design,
Textile Vocational Institutes, Textile Diploma Institute and Bangladesh Silk Research and
Training Institutes under the Ministry of Textiles and Jute. These organizations also provide
assistance, training, safeguarding consumer’s interest, producing and repairing spare parts used
in industries, manufacturing necessary tools. Extensive publicity is needed for the proper use of
these important institutes and the facilities available there as many industrial entrepreneurs are
not aware of the necessary technical and other assistance available for the industrial sector
through these institutes.

The present government has identified the Small and Medium Enterprises (SMEs) as a priority
sector and as the driving force for industrialization, in order to further strengthen the country's
industrialization process. The Principal Secretary of the Prime Minister's Office has formed and
led a national taskforce for following proper policies and planning to establish SMEs. A cell has
been created under the supervision of the Ministry of Industries comprising officials experienced
in SMEs from the Ministry of Industries, BSCIC, NPO, Asian Development Bank, The
Federation of Bangladesh Chambers of Commerce and Industry, National Association of Small
and Cottage Industries, Bangladesh and women entrepreneurs with a view to providing
entrepreneurs with support in the establishment of SMEs. The conception of women
entrepreneurs and their participation in industrialization have been given considerable
importance by the government in the present industrial policy.

Necessary steps have been taken to hygienically preserve like the preservation of frozen,
pasteurized, canned and dry foods in a modern and hygienic way and market agricultural
products of Bangladesh. Steps will be taken to properly use the natural and mineral resources of
the country such as gas, coal, hard rock, limestone, silicon, monazite, zircon, rutile, oyster, pearl,
seaweeds etc, available in the country's sea-beach so that new commercial industries can be set
up. Providing further importance and incentives to the use of ICT in a number of sectors is one
of the prominent features of the present Industrial Policy. Government will take steps to use solar
power and municipal refuse to generate electric power in order to minimize power shortage in
running small and cottage industries. Government is also emphasizing on setting up special
economic zones in different parts of the country, improving the quality of industrial products to

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world standard, marketing of goods at competitive prices and enhancing productivity in the
industrial sector.

Write-up 3

Government’s priority infrastructure project in Bangladesh

Padma bridge: The Padma Bridge is a multipurpose road-rail bridge across the Padma river
under construction. It will connect Louhajong, Munshigonj to Shariatpur and Madaripur, linking
the south-west of the country, to northern and eastern regions. Padma Bridge is the most
challenging construction project in the history of Bangladesh. The project has originally been
planned to be completed by December 2013, the much-troubled Padma Bridge Project is now
making good progress. It is expected to be completed by 2018. A construction firm, China Major
Bridge Engineering Company Ltd, has been selected to construct the long aspired bridge on the
river Padma. When the World Bank had agreed to fund it, the estimated cost was $2.9 b at 2010.
After the World Bank withdrew its promise, the government began implementing the project
from 2014 using its own resources, with a budget of $3.7 b.

Metro Rail Project: The Dhaka Metro is an approved metro rail system under construction in
Dhaka. It is a part of the 20 years long Strategic Transport Plan made by the Dhaka Transport
Coordination Authority. The deal for construction of the 20.1 kilometers, costing $2.8 billion,
was signed by the Government of Bangladesh with the Japan International Cooperation
Agency on 20 February 2013. This first route, originally projected to start from uttara, to
Sayedabad, was eventually extended north to Uttara and truncated south to Motijheel. Each train
will hold up to 1800 passengers. With 56 trains to be in service by 2019, Dhaka Metro is
projected to serve more than 60,000 passengers per hour by 2021, with wait times of
approximately 4 minutes. The entire route will be able to be travelled in less than 40 minutes at
an average speed of 100 km/h. The civil work is done by the Italian-Thai Development Public
Company Ltd. and Sinohydro Corporation Ltd. JV and a Tokyo-based construction company is
developing the depot's land.

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Bangabandhu Satellite 1: The Bangabandhu satellite 1 is the first ever Bangladeshi
geostationary communications and broadcasting satellite, manufactured by Thales Alenia Space.
It has been launched on 11 May, 2018. The project is being executed by Bangladesh
Telecommunication Regulatory Commission working hand in hand with US based, Space
Partnership International, LLC.

Rooppur Nuclear Power Plant: The 2400 megawatt Rooppur nuclear power project has made
noteworthy progress as it has initialed a $12.65 b financing agreement with Russia last
December. The nuclear power plant is being constructed at Rooppur, adjoining Paksey, in
the Ishwardi Upazila of Pabna District. It will be the country's first nuclear power plant and the
first of two units are expected to go into operation in 2023. It is being built by
the Russian Rosatom State Atomic Energy Corporation.

Rampal Power Project: The Rampal power plant is a proposed 1320 megawatt coal-fired
power station at Rampal Upazila of Bagerhat District in Khulna, Bangladesh. It is a joint
partnership between India's state owned National Thermal Power Corporation and Bangladesh
Power Development Board. The joint venture company is known as Bangladesh India Friendship
Power Company. It will be the country's biggest power plant. The Sundarbans is now at the risk
of destruction because the Bangladeshi government is moving ahead with the development of the
project.

Deep Sea port: The government has abandoned Sonadia deep sea port and has concentrated on
developing the Paira Deep sea port off Patuakhali. A British company, HR Wallingford has
completed the probability study for Paira deep sea port. This would guide the government in
deciding the implementation plan. The government is getting proposals from China, UK,
Belgium, Netherlands, Denmark and India. These countries are interested to invest more than
$15 billion. The government has set short term, mid term and long term goals for the port. In
short term, this year the government would enable outer anchoring of clinkering, fertilizer and
other bulk ships. In mid term, the government would complete building a versatile and bulk
terminal infrastructure by 2018 at a depth of 10 meter channel through dredging. By 2023, a full
deep sea port facility of 16 meter channel will be operational.

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Liquefied Natural Gas Terminal: Petrobangla on March 31 signed a contract with US based
company, Excelerate Bangladesh to build the floating terminal within two years investing $500
million after six years delay. A crucial part of this project is construction of a 90 km gas pipeline
from Maheshkhali to Chittagong to connect to the national grid. The government will spend $1.5
b, a year to import 500 million cubic feet of LNG per day from Qatar from 2017. Excelerate
Energy will realize $159,000 per day as rent of the floating terminal and $45,000 per day as
operational charge. As a result, the price of each thousand cubic feet of natural gas from
imported LNG would be at least $3.2.

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Write-up 4

Sectors Bangladesh governments want to see flourishing

The economy of Bangladesh is growing rapidly. In a report of UK-based multi-national

company, Price Water House Coopers, it has been said that Bangladesh would become the 29th
economy of the world by 2030 and 23rd by 2050. The private sector is contributing
noticeably to the economic growth of Bangladesh through production, investment
and exports, along with the public sector. Agribusiness, RMG, ICT and outsourcing,
tourism, pharmaceuticals and healthcare are some of the most promising areas for private sector
engagement and investment. According to the Bangladesh Economic Survey 2019,
published by the Ministry of Finance, total investment in the country during the
fiscal year 2018-19 was 31.56 per cent of gross domestic product (GDP) and the
private investment to GDP ratio was 23.40 percent. The government has been taking
various steps to attract local and foreign investments, develop infrastructural
projects, ensure uninterrupted power supply and utilities. Government is
continuously trying to create a business-friendly environment to facilitate private
sector growth. Despite the importance of public sector in ensuring good governance,
private sector investments remain as fundamental as ever before in carrying forward
the wheels of socio-economic progress, increasing production, creating employment
and reaching essential goods to the doorsteps of the common people. Prime Minister
Sheikh Hasina describes private sector as economy’s “driving force”. She assured of
continuing supports from the government flourishing the private sector. Government
has established the Private Sector Development Policy Coordination Committee for developing
private sector, Bangladesh Economic Zones Authority (BEZA) and Bangladesh Investment
Development Authority (BIDA) for associating industrialization. Bangladesh Investment
Development Authority launched online-based one-stop services for investors from
January 2019 for increasing local and foreign investments. The Bangladesh Export
Processing Zones Authority has been contributing to industrial growth in the private
sector by attracting investments in the eight EPZs run by it at Dhaka, Chattogram,
Mongla, Cumilla, Ishwardi, Uttara, Narayanganj and Chattogram. A total of 572

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industrial establishments have already been authorized by BEPZA for setting up
industrial units. Government has setup Public-Private Partnership (PPP) office for
infrastructure development and conscripted time-befitting industrial and export polices for public
and private investment along with initiatives to ensure infrastructure facilities. It is considered
to be a connection between investments made by the public and private sectors.
Government also encourages private investment in infrastructure sector. They are taking
productive incentives to attract foreign investment. Government has taken steps to build Special
Economic Zones across the country. A high-tech park is being constructed at Kaliakoir, Gazipur.
It has a target of employing ten lakh people in the IT sector by 2021. It will export goods of 5
billion dollars a year. The government of Bangladesh has been working with a far-reaching goal
to make improvement in its standings on various indexes like Cost of Doing Business Index of
World Bank, Global Competitive Index of World Economic Forum, UN Human Development
Index, Global Innovation Index and Logistics Performance Index aimed at turning Bangladesh
into a developed economy. The per capita income rose to $1466. Bangladesh grossed a GDP
growth above 6 percent over the last several years and 7.11 percent growth last year. 90 percent
of the country's development project fund comes from internal resources. The export earnings
rose to over $34 billion in 2015-16 from a mere $10.5 billion in 2005-06, while the foreign
currency reserve stands at $32 billion. The increasing investments in these EPZs up to
February 2019 made $4.88 billion. The actual investments in the EPZs during the
first eight months of 2018-19 were $203.16 million and the exports were $5.02
billion worth.  The growing exports from the EPZs up to February 2019 stood at
$71.59 billion. Bangladesh has already earned a extraordinary success in accomplishing
MDGs and similarly Bangladesh wishes to develop as a global role model of executing SDGs
achieving its targets by 2030. However, government is trying to flourish the private sector with
full force.

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