...Problems in developing small scale enterprises in Bangladesh There are a huge number of problems in the question of developing small scale enterprises in Bangladesh, which are discussed below: Individuality: Maximum small scale enterprises are owned by the individuals and an individual has obviously some limitation. Lower Per Capita Income: Per capita income of our people is low and for this reason our people are not being able to generate adequate capital to run the business efficiently. Unskilled Human Resources: Human resources of our country are not skilled this is a problem with developing small scale enterprises in Bangladesh. The economic environment of our country is not hundred percent suitable for operating the business another cause of the restrictions. Excessive import of foreign product: Excessive import of foreign product in our country is another reason cause when the people of the country will be mainly dependent on the imported product then the entrepreneurs will loose their interest to develop small scale enterprises. Political instability: Political instability of our country is another reason for developing the small scale enterprises rate slow. Political environment of our country is not suitable enough to run the efficient business in our society. Deterioration of Morality: Public moral is getting down means most of our people are loosing their moral and for this reason developing small scale enterprises in Bangladesh is not so easy like the other...
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...4.1 Historical Background Bangladesh Small and Cottage Industries Corporation (BSCIC) is a public sector enterprise with autonomous character entrusted with entire task of promotion and development of small and cottage industries in Bangladesh. It is the successor organization to the former East Pakistan Small industries Corporation (EPSIC) which was established by an Act of the parliament in 1957. Main role has been to assist the promotion of small manufacturing enterprises by- (a) developing infra-structural facilities for industry, (b) providing technical assistance and counseling services, (c) financing industries in the private sector and (d) setting up industries for which private investors were reluctant. Under the direct or indirect initiative of BSCIC a plenty of entrepreneurs has been created and enterprises has been set up in the country. But the influence of globalization and the free economy impacts upon the traditional manufacturing enterprises. This situation for marketing of small and cottage industries products is a major constraints facing by the sector. BSCIC is to provide facilities to the existing and new entrepreneurs to expand and develop their markets and to stay and sustain in the competitive environment. The definition of small-scale industry has undergone a considerable change in Bangladesh from time to time under government industrial policies. During the period 1957-65, small scale industry in Bangladesh (the then East Pakistan) stood...
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...Introduction The Small and Medium scale Enterprise (SME) are recognized worldwide as engines of economic growth. The commonly perceived merits often emphasized for their promotion especially in the developing countries like Bangladesh include their relatively high labor intensity, dependence on indigenous skills and technology, contributions to entrepreneurship development and innovativeness and growth of industrial linkages. The case for fostering SME growth in Bangladesh is irrefutable as these industries offer bright prospects for creating large-scale employment and income earning opportunities at relatively low cost for the unemployed especially in the rural areas strengthening the efforts towards achieving high and sustained economic growth which are critically important prerequisites for triggering an exit from endemic poverty and socio-economic deprivation. These promotional arguments for the SMEs, while universally emphasized are often put forward by their ardent advocates in a small versus large context and thus arouse serious debates concerning their economic viability. Much of such controversies may, however breakdown if the intrinsic virtues specific to SMEs and unavailable to large-scale industries are correctly identified and carefully exploited. A combined interaction of the forces of product-mix, location factors, technological advantages and market advantages create opportunities for SMEs to grow and prosper at all levels of development which are often ignored...
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...Momtaz Uddin. (1992). Small and Medium Scale Enterprises in Industrial Development, Academic Publishers, Dhaka. 3. Ahmed, Momtaz Uddin (1984). Financing Rural Industries in Bangladesh, the Bangladesh Development Studies, Vol. XII, and No. 1 and 2, “Special Issue on Rural Industrialization in Bangladesh”. Website:http://www.google.com/#pq=ahmed%20momtaz%20uddin%202006%20sme%20policy%20making%20process&hl=en&cp=87&gs_id=6e&xhr=t&q=ahmed+momtaz+uddin+et+al+1992+small+%26+medium+scale+enterprise+in+industrial+development&pf=p&sclient=psy&source=hp&pbx=1&oq=ahmed+momtaz+uddin+et+al+1992+small+%26+medium+scale+enterprise+in+industrial+development&aq=f&aqi=&aql=&gs_sm=&gs_upl=&bav=on.2,or.r_gc.r_pw.&fp=a9b1f76dc7591fd9&biw=1024&bih=605 4. Asian Development Bank (2004). Report and Recommendation of the President to the Board of Directors on Proposed Loans and Technical Assistance Grant to the People’s Republic of Bangladesh for the Small and Medium Enterprise Sector Development Program, Retrieved from World Wide Web: www.adb.org/Documents/RRPs/BAN/rrp-ban-35225.pdf 5. Md. Shamsul Alam & Md. Anwar Ullah: SME in Bangladesh and their financing. Website:http://www.goodgovernancebd.org/link/Good%20governance%20studies/Articles%20from%20Internet/SME%207/Anwar.pdf 6. Government of Bangladesh (2010), Economic Review, Ministry of Finance, Dhaka. 7. Government of Bangladesh (2010), The Industrial...
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...THE SMALL AND MEDIUM ENTERPRISES (SME) IN BANGLADESH: AN OVERVIEW OF THE CURRENT STATUS DR. MOMTAZ UDDIN AHMED VICE CHANCELLOR STATE UNIVERSITY OF BANGLADESH 1.0 The Case for the SMEs The SMEs1 worldwide are recognized as engines of economic growth. The commonly perceived merits often emphasized for their promotion especially in the developing countries like Bangladesh include their relatively high labour intensity, dependence on indigenous skills and technology, contributions to entrepreneurship development and innovativeness and growth of industrial linkages. The case for fostering SME growth in Bangladesh is irrefutable as these industries offer bright prospects for creating large-scale employment and income earning opportunities at relatively low cost for the un-and unemployed especially in the rural areas strengthening the efforts towards achieving high and sustained economic growth which are critically important prerequisites for triggering an exit from endemic poverty and socio-economic deprivation. These promotional arguments for the SMEs, while universally emphasized are often put forward by their ardent advocates in a small versus large context and thus arouse serious debates concerning their economic viability. Much of such controversies may, however breakdown if the intrinsic virtues specific to SMEs and unavailable to large-scale industries are correctly identified and carefully exploited. A combined interaction of the forces of product-mix, locational...
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...Lecturer SB, IUB. Submitted by: Farzana Rubaya Id: 1230580 MGT (405) Sec: 01 Introduction : Small and medium-sized enterprises sometimes also called small and medium enterprises (SMEs) or small and medium-sized businesses (SMBs) are businesses whose personnel numbers fall below certain limits. These are the most common businesses found across most of the world’s economies. The World Bank Review on Small Business Activities establishes the commitment of the World Bank Group to the development of the small and medium enterprise (SME) sector as a core element in its strategy to foster economic growth, employment and poverty alleviation. In the context of Bangladesh, the development of Small and Medium Enterprises (SMEs) can be considered as a vital instrument for poverty alleviation and ensure the rapid industrialization. So we can say that the role of Small and Medium Enterprises (SMEs) is indispensable for overall economic development of a country particularly for developing countries like Bangladesh. It has drawn a lot of interest among policy makers, academics, businessmen and people in general. Government of Bangladesh has highlighted the importance of SME in the Industrial Policy-2005. SMEs have been identified by the Ministry of Industries as a ‘thrust sector’. As the SME sector is labor intensive, it can create more employment opportunities. For this reason government of Bangladesh has recognized SME as a poverty alleviation tool. As a result they will enhance the standard...
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...the first time internationally, a means of empirically testing Nobel prize-winning ideas related to information asymmetry and capital rationing. The data provides a means of providing yet better guidance for public policy with respect to addressing potential capital market imperfections that might constrain growth and economic development of SMEs. As designed, the research initiative can and will provide valuable information about these issues. In summary, the baseline survey undertaken as part of the SME FDI is a potentially invaluable resource with respect to the design, targeting, implementation, and follow-up assessment of public policy approaches to nurturing SME growth and viability. The outcomes of this research process could help Industry Canada and its partners to provide Canadian SMEs with substantial competitive advantage through policy measures that are yet more precisely targeted, effective, and efficient. It is therefore essential that this valuable resource be used with appropriate and careful study. Analysis of these data may allow for the resolution of several long-standing contentious issues with which policy makers, researchers, lobby groups, and, indeed, SME owners have had to...
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...Characteristics/Profiles of Bangladeshi Entrepreneurs Several studies were done in order to identify the characteristics or profiles of Bangladeshi entrepreneurs. Papanek (1969) observed psychological trait of risk taking among the people of the then East Pakistan(now Bangladesh). Farouk (1983) did a survey on Bangladeshi entrepreneurs and in this survey he focused on the biography of successful Bangladeshi entrepreneurs. He found that Bangladeshi entrepreneurs are generally hard working, honest, religious, trustworthy, reliable, and less educated and live simple lives. Most of the entrepreneurs in this survey had poor educational background and were not good students. Generally these entrepreneurs come from three groups: 1. Those families who have been in business or industry by tradition and their children Are now in business, 2. Retired government officers or politicians or their family members. 3. Those that began small but achieved considerable success by their personal efforts. Rahman (1989) found that Bangladeshi Entrepreneurs possess some characteristics that are similar to characteristics of entrepreneurs in other countries. He did an extensive survey on 5 living Bangladeshi entrepreneurs and found that they are hard workers, truthful, religious, simple living, honest, sincere, good leaders; task oriented and had capacity to influence others. The highest educational degree they achieved was the Bachelors degree. Most of them started their businesses...
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...Journal of Social and Development Sciences Vol. 1, No. 3, pp. 91-100, Apr 2011 Constraints of Manufacture based Small and Medium Enterprise (SME) Development in Bangladesh 1Business Feroz Ahmed1, *Md. Mizanur Rahman1, Monimul Haque2 Administration Discipline, Khulna University, Bangladesh 2Department of Finance and Banking, University of Rajshahi *mizanurku03@yahoo.com Abstract: Small and medium enterprises (henceforth, SMEs) play a key role in economic growth and industrial development of a country. They make vital contributions in improving economic and social sectors of a country through stimulating large scale employment, investment, development of indigenous skill and technology, promotion of entrepreneurship and innovativeness, enhancing exports, and also building an industrial base at different scales. SMEs worldwide have been benefited from the combined interactions of forces of product mix, location factors, and market advantages. However, evidences also suggest that there are cases of SME failures. Growth of SMEs is constrained by many factors. Many SMEs occasionally go on growing into large firms. This paper looks for identifying such constraints of manufacture based SME Development in Bangladesh. From the study, it has been identified that, lack of utility facilities, for example, electricity, gas and water, frequent changes of the prices of raw materials as well as shortage of raw materials, political unrest, high interest rate on borrowings, high transportation...
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...15 WALTON BANGLADESH Role of Walton Hi-Tech Industry in the Economy of Bangladesh By Group Five An assignment on “Role of Walton Hi-Tech Industry in the Economy of Bangladesh” Prepared to: Professor Dr. Farah Hasin Faculty of School of Business BUS-525 North South University (NSU) Prepared by: Group: Five (Section – 03) SL NO | NAME | ID | 1. | Md. Easir Arafat | 1512679660 | 2. | Md. Asif Morshed Azad | 1513028660 | 3. | Md Owahiduzzaman Bhuiyan | 1512678660 | 4. | Md. Rowshan Ali Khan | 1512716660 | North South University Date of Submission: 17 August, 2015 Table of Content S.L No | Particulars | Page No. | | Executive Summary | 1 | 1. | Company Background | 2 | 1.1 | Walton HIL | 2-3 | 1.2 | Primary industry | 3 | 1.3 | Standard Industrial Classification | 3 | 1.4 | Mission | 3 | 1.5 | Vision | 4 | 2. | Describing the Walton Customer | 4 | 2.1 | Electronics Market in Bangladesh | 4 | 2.2 | International Market of Walton Hi-Tech Industry | 5 | 3. | Major Determinants of Demand of Walton hi-Tech Industry | 6 | 3.1 | Choice of variables...
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...Problems and prospects of our small industries Published : Saturday, 05 January 2013 Women working in a small industrial unit Md Atikur Rahman Every country wants to develop. We believe that industrial development can bring in faster development for any country. A well-conceived industrialization strategy, be it import substitution industrialization or oriented industrialization, can be useful in accumulating wealth. Many of the developing countries have achieved development through industrial development. Most developed countries are industrially developed countries. Europe and America's quick development came through industrial development. Japan, Korea, Taiwan, Hong Kong and Singapore became economically developed by having quick industrialization. In late 20th century some countries like Malaysia, Thailand, China, Indonesia and also Philippines developed by quick industrial development. So our government should concentrate more on industrial development in our country. On the other hand, many small industries play a pivotal role in the economic development of a country. Even countries like Japan and the USA that can boast of some of the largest industrial units in the world, had their rapid development and great prosperity thanks to their small industrial units. The most important single argument that can be advanced in their favour is their capacity to generate a large volume of the employment. In Bangladesh, capital is scarce, but cheap labour is abundantly...
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...Report On Contribution of Banks on SME Sector in Bangladesh 1 LETTER OF TRANSMITTAL 2 ACKNOWLEDGEMENT 3 Table of contents No: Page: Chapter One Introduction 1.1 Introduction 1 1.2 Background of the study 2 1.3 Problem statement 3 1.4 Objectives of the study 3 1.5 Scope of the study 4 Chapter Two Methodology 2.1 Data requirement 5 2.2 Study area 6 2.3 Sample size selection 6 2.4 Questionnaire development 7 2.5 Literature review 8 2.6 Small enterprise 10 2.7 Medium enterprise 10 2.8 SME financing by Banks in Bangladesh 11 Chapter Three Results 3.1 Contribution of SMEs in the economy 13 3.2 Current status of SME financing by Bangladesh Bank 14 4 3.3 Loan documents needed for SME financing by banks 14 3.4 About the sample banks 15 3.5 Portfolio size of different banks in SME sector 17 3.6 Target given by Bangladesh Bank 19 3.7 Survey analysis 24 3.8 Findings 27 Chapter Four 29 Limitation Chapter Five 30 Conclusions and recommendation Appended Parts Data collection instruments Details of entrepreneurs Bibliography List of Tables 3.1 Portfolio size of Different Banks in SME sector 17 3.2 Distribution of entrepreneurs whether or not they take bank loan 24 to operate their SME business. 3.3 Distribution of entrepreneurs...
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...Financial support for MSME in Bangladesh The SMEs worldwide are recognized as the most effective vehicle for sustainable economic growth. In Bangladesh , a sustainable level of development of small and medium enterprises (SMEs ) is highly needed to reach the targets set by The United Nations (UN) in the millennium Development Goals (MDGs) to alleviate poverty . This urgency is reflected in the Government’s pro-poor policies, especially in the poverty reduction strategy paper (PRSP) . Small and Medium Enterprises in Bangladesh have recently been considered as an important vehicles of poverty reduction strategy. For the first time, the comprehensive Industrial Policy 2005 highlighted SME development as a flagship policy area for balanced and sustainable industrial development in Bangladesh. Availability of finance is thought to be a major constraint to formation and growth of SMEs in Bangladesh. Banks are reluctant to expand their SME credit portfolio because they do not consider SME lending an attractive and profitable undertaking. This is so because SMEs are regarded as high risk borrowers because of their low capitalization, insufficient assets and their inability to comply with collateral requirements of the banks. Administrative costs are also higher because close monitoring and supervision the SME operation becomes necessary. Despite all these facts banks and financial institutions have been providing finance to the SME sector and the volume of finance is showing...
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...collect money from general public and give short-term loans to businessmen by way of cash credits, overdrafts, etc. Commercial banks provide various services like collecting cheques, bill of exchange, remittance money from one place to another place. In India, commercial banks are established under Companies Act, 1956. In 1969, 14 commercial banks were nationalised by Government of India. The policies regarding deposits, loans, rate of interest, etc. of these banks are controlled by the Central Bank. Type 3. Industrial Banks / Development Banks Industrial / Development banks collect cash by issuing shares & debentures and providing long-term loans to industries. The main objective of these banks is to provide long-term loans for expansion and modernisation of industries. In India such banks are established on a large scale after independence. They are Industrial Finance Corporation of India (IFCI), Industrial Credit and Investment Corporation of India (ICICI) and Industrial Development Bank of India (IDBI). Type 4. Land Mortgage / Land Development Banks Land Mortgage or Land Development banks are also known as Agricultural Banks because these are formed to finance agricultural sector. They also help in land development. In India, Government has come forward to assist these banks. The Government has guaranteed the debentures issued by such banks. There is a great risk...
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...1. Introduction Bangladesh faces the challenge of achieving accelerated economic growth and alleviating the massive poverty that afflicts nearly two-fifths of its 135 million population. Strategies for meeting this challenge have included a shift away from state-bureaucratic controls and industrial autarky towards economic liberalization and integration with the global economy. These policy reforms were initiated in the mid-1980s against the backdrop of serious macroeconomic imbalances, caused in part by the declining level of foreign aid and in part by a preceding episode of severe deterioration in the country’s terms of trade. The policy reforms in the 1980s included the withdrawal of food and agricultural subsidies, privatization of state-owned enterprises, financial liberalization, and withdrawal of quantitative import restrictions. The beginning of the 1990s saw the launching of a more comprehensive reform program, which coincided with a transition to parliamentary democracy from a semi-autocratic rule. These later reforms were particularly aimed at moving towards an open economy – such as making the currency convertible on the current account, reducing import duties generally to much lower levels, and removing virtually all controls on the movements of foreign private capital. Besides, fiscal reforms were undertaken including the introduction of the value-added tax. During the 1990s, notable progress was made in economic performance. Along with maintaining economic...
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