Proper govt guidance is key to sustainable growth

Mohammad Abu Hafiz

BANGLADESH Steel and Engineering Corporation (BSEC) has a strong stance on business policies. Its first and foremost attention is towards quality.
“We never compromise on product quality,” said Chairman Mohammad Abu Hafiz. “That is a reason why we don't use scrap metal.”
However, to uphold quality and sustain business, government policy support is needed.
Hafiz is running nine establishments under the industries ministry, including vehicle assembling and marketing, ship maintenance, power generator manufacturing, cable industry, tube industry and blade manufacturing.
Hafiz, a retired additional secretary, has been working with BSEC under a contract from 2009. He sat with The Daily Star to share his views on the prospects and problems of the public industries.
He said a consistency in government policy can help the national industries sustain.
BSEC has earned profits worth Tk 73.77 crore in fiscal 2010-11 when its total sales amounted to Tk 1,119.54 crore.
Before the independence of Bangladesh, BSEC ran a total of 62 companies but now it is running only nine.
Hafiz said after the death of Bangabandhu Sheikh Mujibur Rahman in 1975, the then government changed the industry policies and turned many of the public companies into private ones.
The current government is encouraging the public sector to develop. It has issued an order to the government or semi-government offices to purchase products from public companies. He said the companies are trying to revive business in full force at present.
Emphasising Pragoti, a state-owned vehicle assembling company, Hafiz said the company got back momentum with directives from the prime minister. The company paid taxes worth Tk 492.37 crore to the exchequer last fiscal year.
He said the companies of the corporation are trying to do business with their own funds or bank loans. The government does not help them with direct funding.
He is quite happy with the performance of Chittagong Dry Dock Ltd, which is responsible for servicing ocean going vessels.
“We are now planning to establish a full fledged ship-building plant. The industries ministry already has given its consent,” said Hafiz.
He said a consulting firm has already been appointed to design the plant.
The new ship building company would need an investment of at least Tk 200 crore, he said.
The company will produce 20,000 dead weight tonnage capacity ships, he added.
BSEC's National Tubes is a steel pipe manufacturer company of international standards that is enjoying a monopoly in the country. Petrobangla is the largest purchaser of this company, but as the oil company witnessed a budget cut last year National Tubes performed slower than previous years, he said.
But the company will do far better this year, he said.
Eastern Tube Ltd, the bulb manufacturing company under the corporation, is going to introduce compact fluorescent lamps very soon, Hafiz said.
When the BSEC steel mills were shut down, steel prices in Bangladesh began to rise gradually, said Hafiz. BSEC was shut down when the last political government was in power.
The other companies of the corporation are Atlas Bangladesh, a motorcycle importer, Eastern Cables Ltd, Gazi Wares Ltd, General Electric Manufacturing Ltd, generator producer, and Bangladesh Blade Factory Ltd, said Hafiz.
On operating challenges, he said, “We can't sack any of our employees even if he is unproductive or unskilled. This is an obstacle to moving forward.”
The companies cannot invest in marketing activities unlike the private or multinational companies, he added.
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