E-database for SMEs on the card

The SME Foundation is going to create an electronic database of business establishments in this sector with the help of Access to Information (A2i) Programme to ensure the development of small and medium entrepreneurs.

People concerned said work on creating the database will likely start in December this year and the foundation has already formed a committee for this.

The foundation cannot formulate a proper plan for the SMEs due to the lack of a complete database on this sector, which is considered as the lifeline of the country's economy and contributes around 25% to GDP, they said.

Officials said the foundation will compile a complete database by collecting information of small and medium entrepreneurs across the country through the Union Digital Centres (UDC). The database will help the SMEs get government incentives and other facilities easily. An integrated plan for the development of the sector will also be possible.

According to the Bangladesh Bureau of Statistics (BBS) Economic Census 2013, among the 78.8 lakh business establishments of the country 99.93% are cottage, micro, small and medium enterprises (CMSMEs). Only 0.07 % are large businesses.

Industry insiders said the number of CMSMEs has increased in the country in the past eight years. However, a large number of these entrepreneurs are not registered. As a result, the SME Foundation finds it hard to include them in any plan.

For example, they said, the foundation faced a problem in distributing low-interest government incentives as a large part of the entrepreneurs included in the lists sent by different associations were not registered.

Mirza Nurul Ghani Shovon, president of the National Association of Small and Cottage Industries of Bangladesh (NASCIB), who is also a member of the database committee, told The Business Standard, "The number of SMEs in the country far exceeds the figure of the 2013 statistics – at present, the number of CMSMEs alone will be more than one crore.

"Although the SME sector plays an important role in the country's economy, there is no proper database. As a result, our plans do not reflect reality. We need a comprehensive survey."

Md Masudur Rahman, chairman of the SME Foundation, said, "Although the foundation does not have sufficient financial capacity and manpower, it has taken the initiative to create a database using apps."

He said, "The private sector has grown along with the country's economy. The size of the SME sector has also increased. Many new entrepreneurs have been involved in the sector. We do not know the exact number. It is hampering proper planning."

He requested the Bangladesh Bureau of Statistics to conduct a survey on the SME sector.

E-database plan for CMSMEs

The foundation decided to create a complete database of SMEs with the help of A2i while working on the entrepreneurs affected by the Covid-19 pandemic. The pilot project will start in an upazila of the country. Later, it will spread to other upazilas.

Small and medium entrepreneurs will be able to register online through the Union Parishad Digital Service Centre in each union of an upazila. The information would be stored in a central database. The foundation will develop an integrated plan for SME development based on this database.

SME Foundation Chairman Masudur Rahman said, "We have an experience of creating a directory of female entrepreneurs with the help of a foreign organisation. Successful completion of that survey made us confident to take initiative to create an e-database of SMEs across the country. We have already started working on the project despite some delay amid the pandemic. The whole process will start within the current financial year."

BBS Economic Census 2013

The BBS conducted the Economic Census 2013 to provide up-to-date information on the number of business establishments, types and activities classified by major industries at national level.

It provided information on employment generation, businesses, labour force, private sector composition and small area information at national and regional levels.

According to the census, there were 78.18 lakh business establishments in the country including cottage, micro, small, medium and large industries in 2013.

Among them 87.52% are cottage industries, 1.33% micro, 10.99% small, 0.09% medium and 0.07% are large industries.

According to the census, around 2.45 crore people were engaged in various non-farm economic activities whereas the figure was 1.12 crore in 2001 and 2003.

Of the total persons engaged (TPE), the number of males is 2.04 crore or 83.46%, which was 1 crore or 89.09% in 2001 & 2003 and the number of females is 4.05 lakh or 16.54% compared to 12.29 lakh or 10.91% in 2001 & 2003.

According to the National Industrial Policy 2016, large industries are those entities that have a fixed asset except land and factory building of more than Tk50 crore including the replacement cost and have a manpower of more than 300 people (except garments or other labour intensive industries).

Medium industries are those with an asset of Tk15 crore to Tk50 crore and 121-300 manpower. Small industries have an asset between Tk75 lakh to Tk15 crore and 31-120 workers.

However, to be considered as a micro industry the assets should be less than Tk10-75 lakh with a manpower of 18-30 people. For a cottage industry, the asset should be less than Tk10 lakh. In this industry, family members predominate and the total manpower including family members is maximum 15 persons.