***It is indeed regrettable that we have not yet been able to make any appreciably tangible effort to rehabilitate sick industries in Bangladesh. Certainly we no longer can go for industrialisation as was done in the seventies and eighties. It is time that we select potential investment products that are worth developing within five to 10 years.***

ONE of the main reasons for low rate of Industrial growth Is slow Improvement In labour productivity in Bangladesh. Improvement In labour productivity depends to a great extent on capital accumulation. Unfortunately not only do we have Insufficient supply of capital, our investment outlests are also inadequate. The low rate of Investment, despite so much of incentives, is a serious concern for government and business circles. Study of our long list of sick industries (more than two thousand) may reveal that we are gradually losing our competitive edge In low-skilled. labour-Intensive Industries. Thus we shall have to think seriously about upgrading our industrial techniques. To this end the government may ask Bangladesh Institute of development Studies (BIDS) to undertake a study to select a limited number (say 70 to 80) of industrial projects that have the potential to develop in Bangladesh in near future. The study must he completed within one year.

For each of the selected Industrial projects a brief product profile has to be prepared. Such profile will cover all or most of the following topics depending on the availability of data: a) FToduct description and production process (including technology status and trend); b) Major International and domestic manufactures and cost structure: c) Price structure and demand projection: and d) Economic scale of investment and capital requirement.

Such profile may not indicate the profitability of producing the specified product In Bangladesh. It should furnish preliminary information to potential Investors in the country to enable them to take quick decision as to whether to proceed further with an indepth feasibility study on a certain product investment opportu-

nity.

Though It may be easy In principle to carry out such a study by comparing different products according to certain pre-set criteria or by analyzing their potentials from various angles, it Is certainly very burdensome task in reality because a great amount of information will have to be collected within a very short period of time. Thus Is would be realistic to adopt a simplified approach. In the following paragraphs let us discuss about the approach.

The study may be divided into four stage:

Stage One: First compilation of a master list of candidate products has to be made. To make the list as comprehensible as possible we may adopt a very loose criteria for the Initial selection of candidate products. And In doing that the following sources of Information may tie utilised: Scaning Import and Export data of Bangladesh; Studying the Industrial statuses and their export structures of India. Pakistan. Nepal and Sri Lanka; Surveying the literature of high-tech and other new products to search for products that may be technologically appropriate for Bangladesh’s current stage of development; and Requesting overseas cooperating research organisations such as Arthur D Little of USA. or Daiwa Securities and Economic Research of Japan or Price Water house Associates of Australia to provide list of products they think suitable for Bangladesh to develop.

Stage Two: It is to screen out those that were infeasible in any Important aspect of a potential investment opportunity. The remaining products are then be left for further scrutln; Theoritlcally a potential investment opportunity should possess market feasibility, technical feasibility, management feasibil-

ity, cost advantages, and soon. At this stage of study we may use market feasibility and technical feasibility to screen out the candidate products.

Stale three: The important factors that nee be considered at this stage are: (I) manufacturing cost, (H) technology feasibility, (ill) domestic and overseas market potential, (iv) linkage benefits, (v) labour requirements. (M management requirements, (iv) value added contributions, (vlii) energy consumption, (lx) environmental pollution, and (x) degree and time of government protection or incentive. If needed.

Stage Four: An In-depth study need be undertaken on each of the products based on International data mainly to be provided by overseas cooperation agencies and local data collected by our research staff.

It is Indeed regrettable that we have not yet been able to make any oppreclably tangible effort to rehabilitate sick industries in Bangladesh. Certainly we no longer can go for industrialisation as was done in the seventies and eighties. It is time that we select potential investment products that are worth developing within five to 10 years. It Is true we do not have sufficient funding and time to collect all the data needed for a thorough investigation. Yet the study would be able to provide some good investment information to our industrial community. The government should be aware of the fact that as the economy grows so the availability of information becomes Increasingly Important. Industrial advancement Is a continuous and endless process. Such study should, therefore, be the beginning of a continuous endeavour of the government.

The writer is a retired Joint Secretary