Small and cottage industries

This is Black Rose Group
Members are:-
Maria Islam Lipi
Naznin Akter Toma
Md. Royel Hossain 143
Shohel Rana
Borhan Uddin 52

Bangladesh Small
and Cottage
Industries
Corporation

Introduction
Bangladesh small and cottage industries corporation
(BSCIC) is the prime mover organization of the
development of small and cottage industries in
Bangladesh. It provides support service to small rural
and cottage industry in Bangladesh in the small and
cottage industries sector. BSCIC is to provide facilitates
to the existing and new entrepreneurs to expand and
develop their markets and to stay and sustain in the
competitive market. It was created through an Act of
parliament in 1957. The main role of BSCIC is to assist
the promotion of small manufacturing enterprises by
developing infra-structural facilities and providing
technical assistance.

Definition of Small and
Cottage industry
Small Industry:
 It means an industry in which the value cost of durable
resources other than land and factory buildings is in between
(05 to 15 million) taka and employment generation is not
more than 50 persons.
 A small scale industry is a project or firm created on a small
budget or for a small group of people. It produces its goods
using small machines, less power and hired lobor.

Cottage industry:
Cottage industry means family an industry in
which members are engaged part time or
full time in production and service
oriented activities.
According to Merriam Webster,
 An industry whose labour force consists of
family units or individuals working at home
with their own equipment.
 A small and often informally organized
industry.

Historical Background
Bangladesh small and cottage industries corporation is
a public sector enterprise with autonomous character.
It is the successor organization to the former east
Pakistan small industries corporation(EPSIC) which was
established by an act of the parliament in 1957. After
independence EPSIC was renamed as BSCIC by president
order no 156( 2nd amendment) in1972. In october1973,
the government by a gazette notification No. 28
bifurcated BSCIC into two separate corporations
namely: Bangladesh cottage Industries
corporation(BSIC) and Bangladesh small industries
corporation(BCIC).Later these two corporations were
unified in 1975.

Historical Background
continued....
After its birth in 1957, the then EPSIC started
functions with commercial activities like
import of plant and machineries, raw
materials and distribution of the same to the
private sector entrepreneurs. BSCIC’s
industrial estate programme has been
contributing to the process of industrialization
since 1960.Upto April 2009, a total number
of3352 industries has been established in 74
industrial estates in different districts. BSCIC
started implementing special programmes in
the Chittagong hill tracts region since1974.

Objectives of BSCIC
 Increase of industrial production and productivity in
the SCI sector.
 Creation of employment opportunities.
 Poverty alleviation
 Balanced regional growth
 Ensure optimum utilization of economic and human
resources.
 Accelerate overall economic growth of the country
through SCI.

Function of Bangladesh small and
cottage industries corporation
 Promotion and registration of small and cottage
industries.
 Conducting advisory and industrial promotion services
including training of entrepreneurs.
 Skill development for artisans and craftsman.
 Creation of jobs for SCIs
 Construction and development of industrial estates
with necessary infrastructural facilities for SCI.
 Development of linkages between SCIs and large and
medium sized industries.

Continued.......
There are other major functions of BSCIC
 Pre investment counselling
 Post investment extension services
 Technical information
 Marketing information
 Infrastructural facilities
 Skill development training
 Entrepreneurship development training
 Credit facilities

Current Status of BSCIC
Bangladesh small and cottage industries corporation
has developed a total of 74 industrial estates
throughout the country to foster the growth of SCIs in a
balanced manner and also construction for a number of
estates including special type like Tannery, API(active
pharmaceutical ingredients)and garments park are
under execution.

Some types of cottage industries in
Bangladesh:
1.Pottery
2. Bamboo
and cane
industries
3. Jute
goods
4. Textile
and Weaving
factories
5.
Embroidered
Quilts
6. Cool Mat
7. Ornaments

Pottery
 Pottery is a family and community based collective work localised on the
basis of availability of row materials
 According to a survey conducted by BSCIC,There were 666 pottery villages in
Bangladesh, where about 76 thousand people belong to 18 thousand families
had to earn their livelihood from this traditional occupation.
 The total capital investment in the sector was 106 million taka and goods
worth 367.4 million taka was produced during 90s period.. Most of the
artisans engaged in this industry hereditarily and most of them belonged to
the Hindu community.

 The people related to pottery ,known as kumbhokar (potter or clay-modelle).
Major works:
they make dolls, statues of gods and goddess,household goods, sculpture,
tally, flower vases, pots for offering worship, fancy kitchen pots made of
clay.
Pottery localities in BD
Bijaypur of Comilla, Madanpura of Patuakhali, Champaknagar of Feni, Kartikpur
of Shariatpur and Royerbazar in Dhaka are the most remarkable and leading
pottery localities.

Bambao and cane industries:
The survey of BSCIC (1985) suggested that 122 thousand
artisans were engaged in the country's 42 thousand
bamboo and cane crafts making units. At that time raw
materials worth 224 million taka were used per year to
produce items worth 500 million taka.
Major Products:
Major items of this category are cane products, partition,
mat, fishing trap, hand fan, sofa set, table-mat, wall-
mat, tray, flower vase, ash tray etc.
Localities:
They are mainly produced in Comilla, Sylhet,Chittagong and
Noakhali.

Jute goods:
Sika, a netted product of twisted jute ropes of
various indigenous designs and motifs, table mat,
shataranji and carpet, fancy handbag and bag of
jute are produced in four thousand cottage
industries by about eleven thousand craftsmen.
Items worth 30.4 million taka were produced per
year with the annual investment of 20 million
taka.
Major Products:
Table mat, shataranji and carpet, fancy handbag
and bag

Textile and Weaving factories:
In 1978, about one million weavers, artisans and workers were
engaged in 437 thousand handlooms and pure looms of 198 thousand
weaving and textile factories of Bangladesh.
Major Products
Clothing like sharee, lungi, dhuti, muslin, jamdani, katan, malmal
and traditional handloom products of different tribes, gamcha,
mosquito nets and towels. Traditional cloths of tribal weavers,
muslin, jamdani, malmal taroyo sharee, sharees of Pabna and Tangail
origin, Silk and Khadi lengths.
Localities
Narshingdi, Roypura, Demra, Tangail, Shahjadpur, Bera, Kumarkhali,
Magura, Rajshahi, Khadimnagar, Mirgarh and Nasirnagar are very
famous places of origin of these products.

Embroidered Quilts
 The most famous stitch work of Bangladesh is
embroidered quilts, known as Nakshi-Kantha.
 Thirteen different types of high quality Nakshi-Kantha
are stitched everywhere in Bangladesh, but those of
Rajshahi, Nawabganj, Rangpur, Faridpur and Kushtia are
very special in terms of traditional and exclusive design.

Cool Mat
A special type of mat made by bark of a tree named morta.
The mat, very soothing and cool to lie upon. About 15
thousand artisans produce cool mats of 50 million taka
per year
Localities:
Rajnagar, Balagonj, Baralekha and Mollarbazar area of
Sylhet, Sonagazi and Raipur of Noakhali, Swarupkathi and
Neelgati of Barisal and Shatech of Faridpur.

Ornaments
Ornament-making is one of the most fine and remarkable
cottage based artisanship belonging to the mainstream
anthropological art of Bangladesh.
According to BSCIC, there are 12,250 ornament-making
units and 27 thousand professional goldsmiths in
Bangladesh.
Localities:
Dhaka, Chittagong, Comilla, Sylhet and Faridpur region.

Brass and bell-metal
Cottage industries producing brass and bell-metal
utensils are very much involved with the
culture and tradition of Bangladesh. There are
390 brass and bell-metal production units and
about two thousand highly skilled brass and
bell craftsmen are in Bangladesh. They make
brass and bell-metal goods of 333.7 million
taka per year.
Localities:
Dhamrai and Savar of Dhaka, Nawabgonj,
Islampur of Jamalpur, Rangpur, Tangail and
Shariatpur.

Some small scale industries
in Bangladesh:
1.Food
Processing
Company
2. Rice
Farming
3. Textile and
Garment
Manufacturing
4.Open a Micro
– Finance Bank
5. Fruits
Plantation
6. Seafood
and Fish
Business
7. Freight
Forwarding
Business

Importances of Cottage and Small
Scale Industries
There is a shortage of capital and technical skill in
subcontinental. It is not possible to establish the heavy industries.
While it is very easy to increase the number of small scale
industries.
Following are the main advantages of small scale industry in
subcontinental :
1.Increase in Industrial Products
There is a shortage of manufactured goods in our area. We spend
a lot of foreign exchange on the import of these goods every year.
So we should increase the small scale and cottage industry to
remove the shortage of these goods.

2. Increase in Employment
The rate of unemployment is increasing day by day. To
control unemployment it is necessary that we should
increase the small scale industries because these are
labour intensive. Our farmer can also easily work in
small scale scale industry. It is not possible to provide
Govt. jobs to all the unemployed people. It may also
increase the self employment.
3. Increase in Foreign Exchange Earnings
The various kinds of goods like carpets and sports
sold in the international market. We earn a lot
of foreign exchange by exporting these goods.

4. Use of Industrial waste :-
The waste of large scale industries like cotton and steel
can be used by the small scale industry. In this way we
can save a lot of capital.
5. Provides Employment to Women :-
Our women is engaged in the cottage and small scale
industry and increasing the production. Because in our
society women can not work with other men in the
factories. We should increase the number of cottage
industries to make the female sector a real asset of the
nation.

6. Increase in The Income :-
Increase in the production of goods on small scale increase the income of the
people. The rise in income improves the standard of living. In rural areas
there is great need of small scale industry.
7. Cheaper Production :-
The small scale industry is labour intensive while labour is cheap in
subcontinental, so the production of small scale industry is cheaper. Due to
low prices people purchase more goods and market expands.
8. Proper Distribution of Wealth :-
The small scale industry increases the income of the people and reduces the
gap between rich and poor. We can reduce the poverty by expanding the small
scale industry.

9. Establishment With Small Capital :-
We can establish these industries with
small capital. In subcontinental most of
the people are poor, so they can start the
production with small capital.
10. Development of Backward Areas :-
We can develop backward areas by establishing
the small scale industry in these areas. It will
remove poverty from backward areas.

11. Reduction of Population Pressure :-
The development of small scale industry
reduces the pressure of population on land
and increases the income of the people.
12. Reduction in Migration :-
The unemployed labour force is migrating to
the other countries. If we expand the small
scale industry, it can serve the nation instead
of serving the other countries.

Women Entrepreneurs in Bangladesh
Rural women are involved in cattle and poultry rearing, rice husking,
spice making, imitation ornament trading, pickle making and other
micro businesses. Urban women are mostly involved in block printing
and boutiques, bakery and fast food, doll making, tailoring, fabrics paint,
interior decoration, etc. Women entrepreneurs prefer to start their
business in sectors where female employment is concentrated. The
choice of the sector is limited by various factors such as resource
constraint, female aversion to risk-taking, etc.,

which forces them to engage in activities with low
entry barriers and low financial risks such as food
processing and or clothing and textile sector. Hence
female businesses have smaller employment and
sales than male business. Majority are micro and
small enterprises, employing less than 10 persons.
Most of them are sole proprietors. Participation of
women as entrepreneurs has also improved their
quality of life and their households. They serve as a
role model for young generation for self-employment
opportunities.

The Role of Bangladesh Small
and Cottage Industries
Corporation(BSCIC) in
poverty Reduction in
Bangladesh

 A total of 91 workers are surveyed who work in BSCIC estates and Non-BSCIC
manufacturing firms in the south west region of Bangladesh. BSCIC significantly
influences household consumption and poverty reduction.
 1 percent increase in income from BSCIC will increase the yearly household
consumption by 0.73 percent ,whereas it is only 0.36 percent in case of Non-BSCIC
income.
 The impact of income increase on consumption is more than double for the BSCIC
group household in comparison with Non BSCIC group household.

The Role of Bangladesh
Small and Cottage
Industries Corporation
In Women
Entrepreneurship
Development Program.

Women are regarded as unpaid family workers,
They seldom get a share of the income or
involved in matters of family decision making
.The main constraint related to the development
of entrepreneurship:
 1.Illiteracy
 2.Lack of technical skill
 3.Social and cultural inhabitants
 4.inadequate and ineffective training facilities

 In order to improve this position of women in Bangladesh
,particularly the rural women ,Bangladesh small and cottage
industries corporation proposed a project called “women
entrepreneurship development program (WEDP). Which got its
approval in second five year plan (1980-85) to be implemented
in collaboration with the USAID.
 The WEDP project concept is basically linked with poverty
alleviation of rural disadvantaged group of women.

Barriers of
Small and
Cottage
Industry

1.Economic
2.Environmental
3.Cultural
4.Political
5.Lack of Skill labor
6.Lack of Proper Management

Economic Barriers
Lack of capital
Lack of raw materials
Lack of Loan facility
Lack of Insurance security
Lack of proper banking service
Lack of proper use of capital

Cultural Barriers
Bangladesh is a cultural based country
. It’s small and cottage industry
depend on cultural so we see that Tat
Shilpo is taken place in Tangail ,
Cane industry is taken place in
Comilla , Mrit Shilpo is taken place
in Jessore etc . For this reason we do
not see the same small and cottage
industry in Bangladesh.

Political Barriers
 Political instability of our country is another
reason for developing the small scale
enterprises rate slow. Political environment of
our country is not suitable enough to run the
efficient business in our society.
 Public moral is getting down means most of
our people are loosing their moral and for this
reason developing small scale enterprises in
Bangladesh is not so easy lik the other
country of the world.

Lack of skill labor
 Decisions are taken at one point
 Little or no delegation of authority
 Verbal communication
 Independently run/managed
 All risks borne by the owner
 Extension of the entrepreneurs’
personality
 No separate entity

Lack of proper
management
 Mostly owner financed and limited
borrowed funds with no excess to the
share market [no public issue
 No scope for specialist service
 Little emphasis on long term planning
 Close labor –owner/management
relations.
 No or limited innovative production
/marketing

 Business is housed in small establishments
 Rational cost control possible
 Maximum possible safety of business secret
 Local market and limited non-local market
 Size of investment is relatively smaller
 Volume of sales relatively smaller [limited market share]
 Unable to adopt modern technology
 Mostly handicraft with no use of electricity
 Requirement of minimum legal formalities

Removing the
Barriers of Small
and Cottage
Industry in
Bangladesh

 Government should take the necessary initiatives to develop
this sector.
 Government should have a clear policy about the small scale
enterprises in Bangladesh.
 Loan and this short of facility should be make available.
 Control the inflow of importing such product which have the
opportunities to produce in Bangladesh.
 Adopt extra tariff on importing the product which are
producing in our country.
 Make the political situation stable as much as possible.

 Make the economic situation stable.
 Provide both social and economic securities to the people.
 Improve the human resources.
 Making more entrepreneurs through proper training and loan
facilities.
 Make the people interested to start their own or family business.
 Provide possible support to the small scale enterprises in Bangladesh.
 Combine the smaller enterprises into one through the cooperatives
and so on.
 Developing small scale enterprises in Bangladesh through a proper
long term planning.
 Make arrange to export home made product or domestic product into
foreign countries

Problems of cottage and small
scale industries:
Lack of Finance :-
The cottage and small scale industry is facing the
problem of capital shortage. The financial institutions
are not ready to provide the credit on low rate of
interest. It is an obstacle in the ways of small scale
industry development.
Competition :-
There is a stiff competition between the large scale
industry and small scale industry and usually small scale
industry suffers a loss.

Import Policy :-
The import [policy of the government is also not
favorable for the small scale industry. It discourages the
small scale industry.
Smuggling :-
Smuggling of large scale consumer goods from Russia,
Iran and Singapore has also discouraged the small scale
industry.

Problem of Raw Material :-
The owner of the small scale industry can not get enough
raw material what he wants. Poor quality of raw material
is provided on higher prices to the small industry.
Old Methods of Production :-
Small industries use old machines and old methods of
production. Due to this the quality of small scale
industries product is very poor. So they are helpless to
sell the product at low rate.

Lack of Marketing Facility :-
The marketing facilities are inadequate in the country.
The small and cottage industries are selling their product
at the low prices in the hands of middleman. Even they
can not advertise their product on T.V because they have
not sufficient capital for this purpose.
Lack of Qualified Staff :-
The cottage industries can not employ the qualified
engineers and economists. It reduces the quality of
product.

Shortage of Electricity :-
There are a large number of villages where electricity is
no available. The non availability of electricity is an
obstacle in the way of small scale industries.
Breakdown of Electricity :-
The regular break down of electricity has also affected
the production of small scale industry adversely. Prices of
electricity are also rising day by day. Higher prices has
increased the cost of production.

The role of state in
solving the
problems of cottage
and small scale
industry:

Any government can take advantages by their cottage and
small scale industries if they take some important steps
for this industry. We discuss the important measures to
solve the problems of cottage and small scale industries
under these headings :

Credit Facilities :-
The government should provide the credit to small and
cottage industries at lower rate of interest. Further
commercial banks are also providing loan to develops the
industries.
Industrial Estates :-
The government has set up the number of industrial
estates in the different cities. These areas have been
provided various facilities like, roads, banking, and
transport facilities to encourage the small scale
industries.

Testing Laboratories :-
The government has established the testing laboratories
to maintain the prescribed standard of cottage industries
product.
Supply of Designs :-
The government also provides the new models and
designed to producers to improve the qualify of cottage
industry.
Publicity :-
The government has set up the display centers and show
room,s inside and outside the country to increase the
sale of cottage industry product.

Facility of Raw Material :-
The government imports the raw material for the
cottage industries from abroad and provides them at
lower price to encourage them.
Purchase of Cottage Industry Product :-
The government also purchases finished products from
them and sells it at show room. Govt display centers in
side and out side the country are creating the demand.
Protection Against Foreign Competitions :-
The government has also provided protection to home
industry by imposing heavy duties on the imports. Still
there is a need of further protection. Smuggling should
be also controlled.

Establishment of Training Institutions :-
The government has set up various institutions like
industrial, vocational, commercial and polytechnic
institutions to provide the qualified workers to the
cottage and small scale industries.
Carpet Centers :-
For the training of weavers the small corporation have
set up carpet training development centers. These are
working very usefully.

Handicraft Centers :-
Handicrafts development centers have been set up to
promote the handicrafts.
Advisory Services :-
The small scale industries advisory services has been set
up in each province to provide guidance to the new
comers in small scale industry.

Small and cottage industries

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