Electrical Sector of Bangladesh: Problems & Prospects

Abstract

Electrical is one of the most important business sectors of Bangladesh. It has been identified as a 'booster sector' in the SME Policy Strategy - 2005 and a 'thrust sector' in the National Industrial Policy - 2010 of Bangladesh. Currently this sector in producing about 15 thousand crore taka of export substitute product against local demand of 20 thousands crore taka per year. There are about 2500 electrical enterprises producing 75 types of electrical products in Bangladesh. I last few years this sector earned double digit growth and it has a very potential export market throughout the world. Bangladesh is mainly producing electrical products of HS chapter - 84, 85, 90 and 94. Global market for these products is growing with multiple digits except recent negative trend for global financial crisis in 2009. There are few natural and one man made cluster of electrical products in Bangladesh. Major products Bangladesh is producing are Electric cables, distribution board, large and medium transformer, switch gear, sub-station equipment, electric arc welding machine, enameled ware, insulator, industrial fan, heat and speed control system, magnetic contractor, Parceling bright connector, different connecting equipment, main switch, electric iron and shouldering iron, ceiling fan, table fan, adjust fan, tube light, filament bulb, light fittings, table lamp, different laps, distribution board, electric meter, switch, plug, water heater, florescent light ballast, light & fan controller, torch light, refrigerator, lift equipment, extension cord, and energy saving lamp etc. Major importers of electrical products (Bangladesh do produce) are USA, Canada, Germany, Australia, Mexico, Italy, Denmark, Hong Kong, France and Finland. Major exporters of these products are China, USA, Germany, Japan, Singapore, South Korea, Taipei, Mexico, Netherlands and Malaysia. Major problems of Bangladeshi electrical sector are under invoicing during import of finished electrical products, lack of advanced technological and technical knowledge, absence of IP protection mechanism in action, lack of infrastructure to enter into the export market with electrical goods, and quality flexibilities on imported poor quality products etc.We also recommend some actions for keeping this sector competitive and exploring export market. Government has to play active role to make it one of the fastest growing and large export earning sector of Bangladesh.