Form a support institute for SMEs: analysts
An apex body should be formed for facilitating small and medium enterprises (SMEs) such that the sector's contribution towards economic growth and development is enhanced, speakers said at a seminar yesterday.
The association will promote SME entrepreneurs by providing various services such as credit facilitation, skill development, technology transfer, exhibitions and trainings, export-import facilitation, risk management service and solutions to problems.
It may be similar to the Integrated Association of Micro Small and Medium Enterprises of India, popularly known as 'IamSME of India', the speakers suggested at the seminar, 'SME development: role of an effective SME association'.
The seminar was an initiative of Bangladesh Bank and the Bangladesh Institute of Bank Management (BIBM) in association with the Dhaka Chamber of Commerce and Industry, Institute of Diploma Engineers, Bangladesh (IDEB), RDA (Bogra), Cirdap and Bangladesh Women Chamber of Commerce and Industry.
Addressing the inaugural session of the seminar, Bangladesh Bank Governor Atiur Rahman said the Indian association is working in a variety of areas which are essential for micro, small and medium enterprise (MSME) development.
“The experience of IamSME of India can be a learning platform for our business associations in designing and implementing the MSME sector development agenda,” he said, while requesting the SME department of the central bank to take initiatives to set up an association like the Indian one.
Referring to the private sector-led growth worldwide, he said the majority of the private enterprises are MSMEs. In Bangladesh, 90 percent of the private sector enterprises are in fact MSMEs that contribute up to 30 percent to GDP.
The MSMEs provide employment to 25 percent of the total labour force, with 80 percent of the industrial jobs coming from MSMEs, he said, adding that the MSMEs can play a major role in bridging the urban-rural income gap and contribute towards inclusive growth, if they are developed.
“In true sense, inclusive growth can only be achieved through a vibrant SME sector in a country like Bangladesh,” said Rahman, who also requested the commercial banks to create separate funds for women entrepreneurs in the SME sector.
He said the central bank will open a separate department for women entrepreneurs.
Presenting a keynote paper, Rajive Chawla, chairman of IamSME of India, said: “Bangladesh should have an association like ours to facilitate and promote growth and development of small businesses.”
Bangladesh and India can join hands to be strong partners for future projects for the development of the MSMEs, he said. “Do something today for which the future generation will thank us.”
Citing his country's experiences, Chawla said the entrepreneurs will not need to go to banks for credit, if there is an effective association. The association will assist the entrepreneurs in getting the credit in easier way, he said.
In addition, he said, the association will support entrepreneurs in the marketing and distribution of their products, purchase of raw materials, drafting of agreements with insurance companies and transport arrangement.
Sandeep Chakravorty, deputy high commissioner of India in Dhaka, said the Indian experience can be replicated in Bangladesh.
The MSME sector is not only an enormous contributor to the GDP, it can also play a role in social and economic stability. The sector is the shock absorber for an economy, he said.
“Bangladesh is mainly depending on the RMG sector. The country needs to focus on other sectors, so that they can step in if the RMG sector suffers turbulence,” he added.
Ceceep Effendi, director general of Cirdap, stressed an enabling business environment, hassle-free and faster registration process for opening a new enterprise and reining in corruption in the Asia-Pacific region.
Aftab-Ul Islam, president of the American Chamber of Commerce in Bangladesh, said the SME sector should the icon for the country's development.
Kazi Akram Uddin Ahmed, president of the Federation of Bangladesh Chambers of Commerce and Industry; Selim RF Hussain, managing director of IDLC Finance; and Sabur Khan, former president of DCCI, also spoke.
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