JAGARAN CHAKMA

Bicycle exports from Bangladesh declined 15.31 per cent in the preceding fiscal year (FY) as demand fell amid the global cost-of-living crisis resulting from the ongoing Russia-Ukraine war.

The country earned only $142.24 million by exporting two-wheelers in the last fiscal, down from $167.95 in FY 2021-22, according to the Export Promotion Bureau (EPB).

Mainly two companies that built up their production capacity in a view to increasing two-wheeler exports currently ship bicycles from Bangladesh to destinations abroad.

“Basically, buyers in Europe kept a buffer stock after the Covid-19 period that is yet to sell out due to ongoing economic recession,” said Kamruzzaman Kamal, director for marketing at Pran-RFL Group.

“So, bicycle exports reduced for this reason,” he told The Daily Star yesterday.

Kamal believes bicycle exports from the country may revive from October this year.

“Fresh orders will come at the time as the old stock should be sold out by then,” he said.

According to him, bicycle manufacturers did very well in FY 2021-22 as buyers placed immense orders during the post-coronavirus period.

However, the Russia-Ukraine war changed the global economic situation in a way that impacted bicycle exports, Kamal said.

RFL has the capacity to manufacture nine lakh bicycles annually, a third of which is exported to European markets.

“We need to find new markers to expand exports in this situation,” he added.

Export opportunities and the development of bicycle manufacturing facilities directly generate at least 7,000 jobs in the industry.

As per data from Eurostat, Bangladesh is currently the third largest bicycle exporter to the European Union and eighth largest in the world.

“Bicycle exports fell drastically as the European economy is still in crisis due to the impacts of the Russia-Ukraine war,” said Md Luthful Bari, director for operations at Meghna Group of Companies, the country’s biggest bicycle exporter.

He believes the downward trend of bicycle exports could worsen in coming days due to persisting high inflation and growing global economic crisis.

Bangladesh mainly exports bicycles to Germany, where the economic pressure is continuing and so, the demand for bicycles has reduced significantly.

As such, export orders declined by around 20 per cent compared to the previous fiscal year, Bari added.

In the meantime, production costs have risen due to increased tariff on imports of bicycle related spare parts alongside hikes in gas and power prices.

He also said bicycle exports started booming after the Covid-19 pandemic and they accordingly developed their manufacturing capacity to meet the higher demand.

But the present global economic crisis pushed the industry into new challenges, and nobody knows when this situation will improve, Bari added.