Industries minister Nurul Majid Mahmud Humayun on Sunday urged the private sector and foreign investors to set up spare parts and tools manufacturing units in the country’s economic zones.
‘Purchasing power is increasing day by day. The government is relentlessly working for the industrialisation of the country,’ he said while speaking as the chief guest at a webinar on ‘Automobile Industry Development: Present Situation and Future Prospects’, said a press release.
The Dhaka Chamber of Commerce and Industry (DCCI) organised the webinar.
Japanese ambassador to Bangladesh Ito Naoki took part in the webinar as the special guest while DCCI president Rizwan Rahman delivered the welcome speech.
Humayun urged the foreign investors to invest more in the automobile sector.
Research and innovation are important in this sector, he added.
The minister also said that if needed, a comprehensive policy will be pursued, especially for this industry.
Ito Naoki said that Bangladesh had a strong possibility to establish its own local automobile industry.
‘When we talk about export diversification, the automobile, light engineering and agriculture-based sectors can play a vital role,’ he said.
He informed that Japanese Mitsubishi Motors had shown interest in investing in the CKD assembling plant in Bangladesh.
He said that Mitsubishi and the industries ministry came to an agreement last month to sign a memorandum of understanding to conduct a joint feasibility study on the viability of investment.
It will create technology transfer and employment opportunities for Bangladesh, he added.
He also urged for policy support, tax benefits and incentives to help the industry to grow.
Rizwan Rahman said that a minimum five to 10 year sustaining tariff policy should be taken to support the local vehicle assembling and manufacturing industry.
‘Bangladesh’s automobile sector is mainly dominated by imported reconditioned and new vehicles mostly from Japan, China, India, Europe and the US. Considering the growing market demand, local and foreign investors are now showing interests in investing in the automobile industry,’ he added.
He said that before the Covid-19 outbreak, the automobile market was growing by 15 to 20 per cent with 12 per cent growth in auto parts yearly.
Despite its potential, he said, the absence of long-term policy and consistent tax structure, lack of domestic source of raw materials and relevant skilled human resources as well as inadequate backward linkage limits the development of the automobile manufacturing industry.
He also urged for a long-term policy and a minimum five to 10 year sustaining tariff policy to support the assembling and manufacturing of vehicles.
He also echoed for a separate automobile zone and allowing of joint ventures for parts manufacturing to create local experts.
IFAD deputy managing director Taskeen Ahmed, US embassy economic and Indo-Pacific affairs unit chief John D Dunham and Pragati Industries managing director Md Touhiduzzaman, among others, spoke at the event.
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