BFIDC and the private garden owners grow rubber on around 92,985 acres, producing about 12,000 tonnes

of the raw material a year, according to BFIDC. (daily star)

Rubber growers, exporters fail to reap benefit from rising global demand (http://www.thefinancialexpress-bd.com/more.php?news_id=97013&date=2012-02-04) Rubber growers and exporters fail to reap benefit from the growing global demand of the product which they attributed to lack of government policy support. The sector would be able to earn foreign currency worth Tk 6.0 billion by 2025 if the sector gets government's support, they added. The sector has been witnessing negative growth of export during the first half of the current fiscal which the industry people blamed the imposition of 15 per cent VAT on the product. International demand for the natural product is growing significantly as there is shortage of the item because the producing countries are switching over to palm oil cultivation. But Bangladesh is yet to have its share of the global demand as the government does not pay attention to this sector, they claimed. "Rubber is considered as a natural and organic product, the demand for which is significantly growing both in local and international markets with increasing use of rubber in tyre and tube, electric insulator, printing and garment industries," President of Bangladesh Rubber Garden Owners Association (BRGOA) Mirza Anwar Hussain told the FE. But we are yet to grab the potential market because of lack of government policy support, he added. There is none to look after the sector and even there is no expertise in both public and private sectors, he said adding imposition of VAT on raw rubber is 'unfair', as the government has withdrawn VAT from all agro-based products, such as rice, jute, potato and tomato to boost growth of these sectors. Following the growing demand and high prices, growers are encouraged in cultivating rubber for last two years, he added saying imposition of VAT is a hindrance to the sustainable production and growth of the sector. "We are not opposing the imposition of VAT but we need at least five years for the sustainable production and growth of the sector," he said demanding the VAT waiver till 2017. Explaining the continuous negative growth of rubber export that started from the first month of 2011-12 fiscal, he said the main reason is the imposition of VAT for which exporters fail to continue their

competitiveness. The country fetched $5.47 million during July-December of 2011-12 fiscal from the sector which is 28.40 per cent lower than the same period of the corresponding year. It also fell short by 54.72 per cent of the target set for the period. "One of the reasons for the decline is falling price of the product in recent times," another rubber grower said adding the price for a kilogram (kg) of rubber reached Tk 350 last year which is now traded between TK 270 and Tk 280, he added. If we get proper government support, we will be able in producing 25,000 tonnes of rubber only from the private sector by 2025, the BRGOA president said. "That time we can earn Tk 6.0 billion from the sector," he hoped. "It is the Rubber Board that is yet to be formed, which could only decide the right time to impose tax and VAT on the raw rubber. In the absence of a Rubber Board, there is none to oversee rubber plantation, processing, marketing and export," former president of BRGOA Syed Moazzam Hossain said. Rubber growers demand recognition of the sector as an 'agriculture-based one' and the government's support to utilise its vast potential by providing loans, withdrawing of VAT and other policy supports. They also demanded restart of transferring system of garden who are unable to grow rubber or gardening. Cultivation of rubber is relatively new in Bangladesh, compared to other countries. Both the private and public sector produce about 16000 tonnes of rubber annually.

BANGLADESH: Rubber sector seeks soft bank loans, VAT waiver - Government support can triple production Source: Daily "New Age", Dhaka; 4 June 2011

The countrys rubber industry has bright prospect to become a major area in the economy in three years if the sector is given policy support like soft bank loans and VAT waiver. We will be able to enhance rubber production from $90 million to $270 million annually if the sector gets necessary government support like soft bank loan and waiver of 15 per cent VAT on raw rubber, said Bangladesh Rubber Garden Owners Association (BRGOA) president Syed Moazzam Hossain.

Hossain said the sector was now suffering from diverse problems as there was no bank loan available for the last 13 years and 15 per cent VAT was operative on raw rubber. We need governments policy support to give the sector a fillip, he said. The BRGOA president said demand for rubber is on the sharp rise and per kg rubber now sells at between Tk 350 and 400. The price of the item fluctuated between Tk 70 and Tk 100 last year. Likewise, he said, production cost of rubber has gone up by 50 per cent. So, the sector deserves VAT waiver and bank loans with five per cent interest as rubber is an agriculture product. The BRGOA president said natural rubber has huge demand both at home and abroad. For instance, he said, Turkey, Pakistan, and China have shown keen interest in importing rubber from Bangladesh but we have no surplus quantity to export. In the absence of Rubber Board there is none to oversee rubber plantation, processing, marketing and export. Formation of Rubber Board is a must for nurturing the sector, he said. Due to old clone and primitive plantation system it takes eight years for latex extraction in Bangladesh whereas in Malaysia the clone yield latex in four years. The BRGOA chief has forwarded a set of proposals to the government for the growth of the potential sector. The proposals include, among others, exemption of bank interest, making a rubber policy, setting up a rubber board and rubber research institute, sourcing high yield clone to increase productivity, open up scope for joint venture investment under public-private partnership. We can earn foreign currency from carbon trading since rubber tree extracts carbon dioxide three times more than any other tree. We can take the advantage of multi billion dollars global carbon trading and environmental fund, he said. Around 15,000 tonnes of rubber is produced in the gardens on more than 85,000 acres of land in which 31,400 acres came under rubber plantation in the private sector and the rest under Bangladesh Forest Industries Development Corporation. In Bangladesh locally grown rubber is widely used in the production of sandal, bicycle tyre, automobile part, balloon, shoe sole, etc. The Bangladesh government first disbursed Tk 170 million among 360 garden owners for growing rubber gardens, each on 25 acres of land, in Chittagong Hill Tracts in 1984-85.

Private Party wants more participation (http://www.thefinancialexpressbd.com/more.php?news_id=131894&date=2012-06-05) Formation of a Rubber Board is underway by the government with the objective of raising rubber production to meet growing local demand, enhance export, bring transparency, research and development in cultivation and help the public and private planters.

Once the board is formed, the existing scattered cultivating process may get a spur and be aligned according to the law. It has already got the cabinet approval and is now under process of gazette notification, officials said. Once Bangladesh had to depend on import for a small amount of rubber. Currently demand for 14 thousand metric tons Ribbed Smoke Sheets for various industrial use is met locally. Besides, more than 6 thousand tons is directly exported every year. Demand is increasing every day for variety of end- products. Rubber as raw material is used in footwear, tube, hose pipe, rubber sole, bucket, gasket, oil seal, textile and jute mill spare parts, tire retreating, sandals, rubber mate, rickshaw and bi-cycle tire and in different rubber based diversified industrial products. Rubber is being used in more than 0.01 million industrial products and as Bangladesh is one of the world's ten rubber producing countries its export market is also huge, said Bangladesh Forest Industries Development Corporation (BFIDC) Chairman and Additional Secretary of the Bangladesh Government Prasanta Bhushan Barua. Mr Barua said, currently BFIDC is producing 6000 metric tons of rubber every year on 32,635 acres in 16 gardens mainly in Cox-s-Bazaar, Chittagong, Tangail and Sylhet districts. In last three years, BFIDC produced 17,500 metric tons of rubber earning about TK1.43 billion. Barua said rubber cultivation is a highly potential sector and the BFIDC is trying its best to enhance cultivation. A latest garden is under process in Rangunia of Chittagong where 1000 acres of forest department's unutilized land would be brought under rubber cultivation. The government still holds huge area of barren lands which could be utilized to cultivate rubber latex. Private and BFIDC now produce rubber worth TK3 billion. More than 13 hundred private planters are producing more than 8 thousand tons of rubber on 32,500 acres taken on lease from the forest department, said Bangladesh Rubber Garden Owners Association (BRGOA) President Mirza Anwar Hossain. He said by the year 2025, "we hope to export 24 thousand tons of rubber from Bangladesh in the international market. Still we do have thousands of acres unutilized lands." There is a rubber policy by the government to invite more private party for cultivation but the government is yet to follow it, the BRGOA president said and added no research is taking place in this sector. Currently many countries of the world are adopting hybrid technology to increase production. There are huge opportunities for rubber gardening in Modhupur and in Mithapukur of Rangpur district. The government's unutilized lands could be utilized for gardening and private party may invest money, Hossain said.

The main aim of forming the board is to bring the stakeholders and the planters under one umbrella, make uniformity in price, create transparency, to go for R&D, support the stake holders and develop the rubber industry, said the BFIDC General Manager Md Ilias The main customers of locally produced rubber are Apex, Bata, Gazi Tire and Tube, Rupsha Rubber Industry, Bangladesh Rubber Industry, Beg Rubber Industry and dozens of other shoe manufacturers. A huge number of tire and tube are made of locally cultivated rubber, Ilias said.

'Policy support can raise rubber industry turnover to $270m in 3-yrs'

(http://www.newstoday.com.bd/index.php?option=details&news_id=29245&date=2011-06-04) Countrys rubber industry has bright prospect to become a major area in the economy in three years if the sector is given policy support like soft bank loans and VAT waiver, reports BSS. We will be able to enhance rubber production from US$90m to US$270m annually if the sector gets necessary government support like soft bank loan and waiver of 15 percent VAT on raw rubber, said Syed Moazzam Hossain, President of Bangladesh Rubber Garden Owners Association (BRGOA). In an exclusive interview with BSS, Hossain said the sector is now suffering from diverse problems as there is no bank loan available for the last 13 years and 15 per cent VAT is operative on raw rubber. We need governments policy support to give the sector a fillip, he said. The president of BRGOA said demand for rubber is on the sharp rise and per kg rubber now sells in between Taka 350 and 400. The price of the item fluctuated between Tk.70 and Tk.100 last year. Likewise, he said, production cost of rubber has gone up by 50 percent. So, the sector deserves VAT waiver and bank loans with five percent interest as rubber is an agriculture product. The BRGOA president said natural rubber has huge demand both at home and abroad. For instance, he said, India, Turkey, Pakistan, China have shown keen interest in importing rubber from Bangladesh but we have no surplus quantity to export. In the absence of Rubber Board there is none to oversee rubber plantation, processing, marketing and export. Formation of Rubber Board is a must for nurturing the sector, he said. Due to old clone and primitive plantation system it takes eight years for latex extraction in Bangladesh whereas in Malaysia the clone yield latex in four years. The BRGOA chief has forwarded a set of proposals to the government for the growth of the potential sector. The proposals include, among others, exemption of bank interest, making a rubber policy, setting

up a rubber board and rubber research institute, sourcing High Yield Clone to increase productivity, open up scope for joint venture investment under Public Private Partnership (PPP). We can earn foreign currency from carbon trading since rubber tree extracts carbon dioxide three times more than any other tree. We can take the advantage of multi billion dollars global carbon trading and environmental fund, he said.

Bangladesh fails to cash in on rising global demand for rubber

(http://rubbermarketnews.net/2011/06/bangladesh-fails-to-cash-in-on-rising-global-demand-forrubber/)

Local producers and exporters are yet to reap financial benefits of the growing demand for rubber in the global market due mainly to, what the sector insiders said, lack ofgovernments policy support. They said international prices for rubber and rubber products are increasing as there is a shortage of the item because its main producing countries are switching over to palm oil cultivation. But Bangladesh is yet to have its share of the global demand as thegovernment does not pay attention to this sector, they claimed. We have no Rubber Board and even a policy that can guide the sector people, Syed Moazzam Hossain, president of Bangladesh Rubber Garden Owners Association (BRGOA) told the FE Monday. The rubber growers also do not get loans while a farmer needs minimum six to eight years to collect rubber latex from a tree which requires a lot of investment, he said. Moreover, while a farmer gets fertiliser at subsidised rate for rice and other agro-products cultivation, rubber growers pay double compared to them for fertiliser, he added. The industry needs policy support like soft bank loans, VAT waiver, institutional supports, including research and training, for the growth of the sector, he noted. Explaining the potential of the product, he said businessmen from many countries, especially India, China, Malaysia, Turkey, Singapore and Pakistan, are showing keen interest in Bangladeshi raw and processed rubber for its quality.

The global shortage and price hike of rubber have forced international traders to treat Bangladesh as an alternative source, he said adding the price for a kilogram (kg) of rubber has gone up to Tk 350, which was only Tk 70-Tk 100 per kg two years ago. According to Export Promotion Bureau, the country fetched $19.78 million during July-May of the current fiscal year showing a robust growth of 123 per cent compared to the corresponding period in 2009-10 fiscal. Rubber is considered a natural and organic product, the demand for which is significantly growing both in local and international markets as use of rubber in tyre and tube, electric insulator, printing and garment industries is increasing, the BGROA chief said. He said, It is the Rubber Board, that is yet to be formed, only which could decide the right time to impose tax and VAT on the raw rubber. In the absence of a Rubber Board, there is none to oversee rubber plantation, processing, marketing and export. The government should form a Rubber Board and rubber policy for nurturing the nascent sector, he said adding imposing VAT on raw rubber is unfair, as the government has withdrawn VAT from all agro-based products, such as rice, jute, potato and tomato, to boost growth of these sectors. Rubber growers demand for their recognition as an agriculture-based sector and the governments support to utilise its vast potential by providing loans, withdrawing of VAT and other policy supports. Cultivation of rubber is relatively new in Bangladesh, compared to other countries. The government has been encouraging plantations in the hill areas since 1980. About 45,000 acres of land have been allotted to the Bangladesh Forest Industries Development Corporation (BFIDC) so far, and 32,500 acres to private owners, for rubber plantations.

Rubber industrys prospects

Posted on June 7, 2009 | Leave a comment

http://nation.ittefaq.com/issues/2009/06/06/news0291.htm AS appeared in the press recently, a local entrepreneur is producing liquid rubber and marketing the item in a remarkable feat giving a lift to the countrys five decades old rubber industry. The enterprise, HR Latex, set up at Chokoria near Coxs Bazar, has successfully developed 60-grade rubber, usually known as liquid rubber, after an untiring effort of four years. Production of liquid rubber an intermediate material used to make costly products like divers outfits, surgical gloves and automobile parts, etcetera lifts the local rubber producers position from mere rubber-sheet makers. Local rubber developers led by the state-owned Bangladesh Forest Industries

Development Corporation used to produce rubber-sheet, a low-end product mainly used for footwear production. Before commercial marketing of the homegrown liquid rubber until last year the country used to depend fully on import to meet the annual demand of liquid rubber amounting to about 14,000 tonnes. The local plant now supplies 2,000 tonnes that helps the country save foreign exchange worth Taka 200 crore at least by substituting the import of the item. The local enterprise worked hard for the development of its own formula for producing liquid rubber is not made available by other producers. Technology transfer is usually restricted in most of such industries elsewhere also. Slowly many private entrepreneurs are coming forward with such industrial ventures like the one at Chokoria. It has 12 rubber gardens on 300 acres land in the surrounding area and the liquid rubber plant can now meet one-seventh of the countrys total demand annually. What is more significant to note is that the local rubber enterprise, if provided with official support and assistance, can meet the total annual requirement of liquid rubber of the country within next five years

Problems of Rubber Production in Bangladesh and Their Solutions

Jat/Clones, Cultural Practices and Processing (http://feppcar.org/9/problems-of-rubber-production-in-bangladesh-and-their-solutions/) Introduction Rubber is one of the most important cash crops, with multipurpose uses. It is produced from the latex of rubber trees (Hevea brasiliensis (Willd. ex Adr. De Juss.) Muell. Arg.), an exotic deciduous rain forest tree species of Family Euphorbiaceae. The British planters first introduced it in Bangladesh in the early twentieth century. But commercial plantation was started in 1961 by the government in Chittagong and Sylhet hilly regions. Later on, plantations were expanded in Chittagong Hill Tracts and Madhupur by the government and public enterprises. The British and some other private companies also planted rubber in the fellow lands of tea estates. At present about 25,000 hectare of land is under rubber plantation in Bangladesh, and annual production is about 7,500 tons against 20,000 tons countrys total demand of natural rubber (NR). Although production of NR is far less than the demand still the price is very low, even less than the cost of production, due to competitive low price of NR and synthetic rubber (SR), a bi-product of crude oil, in the international market. Considering high productivity, storage, transportation and marketing facilities, the government encouraged its plantation with financial support; land allotment and foreign technical assistance. Public and private enterprises established plantations in different hilly regions and commercial exploitation started successfully within seventh years of plantation. The growth and latex flow is also very encouraging. Since maintenance and processing cost is relatively very low and a good price of rubber prevailed till 1996, it was considered an important crop with high potentiality. Prospects and Uses

It should be mentioned here that, natural rubber is the raw material for tyres and tubes of automobiles, bi-cycle and rickshaw, footwear, belts and hoses, latex foam, cables and wires, battery boxes, gloves, coats and aprons, air bags, life jackets and life buoys, adhesives, balloons and toys etc. and it is also essential for processing synthetic rubber. Therefore, the future of rubber is very bright. Besides rubber, rubber plants have many other uses e.g.: 1. Timber: After economic exploitation of rubber for about 30 years its timber will be a good source of furniture timber. 2. Rubber seed oil: Rubber seed kernel is used for extraction of oil, which is abundantly used as lubricant, and for soap and paint industries and the cake as a good fertilizes and poultry feed. 3. Honey: Mature rubber plantations are the potential source of honey. Honeybees collect large quantities of nectar from extra floral nectarines at the swollen tip of the petiole. 4. Affluent or latex processing wastes and residues can be used as fertilizer and making biogas for power. 5. Land improvement: Every year fallen leaves add 6 to 7 tons per hectare of biomass. Moreover, rubber roots make a very good net spreading in the top soil up to a depth 1 to 1.5 m and increase the porosity of the soil. 6. Carbon sink: Rubber is a very preferred fast growing multipurpose species for quick afforestation. It acts, as a good carbon sink will be helpful in reducing global warming. 7. Ecofriendliness: Rubber plantations have a green image and are inherently environment friendly. Properly managed plantations are self-sustainable ecosystems and could maintain a fair degree of biodiversity. Rubber plantations do support different plant species. Yield and productivity A well-managed plantation in the traditional zone can produce 3 tons rubber per hectare. The average yield of rubber is about 1.6 tons in India. But in our non-traditional condition we have achieved about 0.5 ton/ha only. Unfortunately, the industry suffered badly in the last decade with the decreasing price in the international market, and import of low priced natural and synthetic rubber through free market economic policy. Moreover, low productivity due to lack of proper cultural practices and appropriate processing facilities aggravated the situation further more. New investment for extension of plantation and maintenance of existing plantations was becoming discouragious. For development and expansion of rubber, systematic research and protection of market price were not done. As a result, the industry became a loosing concern and thousands of workers were not getting wages in time. Plantation investment, expertise and skillness, and dependency on the job were in a serious position. The rubber industry was facing destruction although there was a great demand for NR in Bangladesh. In this situation, the government should take necessary measures to save the plantation industry considering its contribution in land utilization, afforestation, and development of environment and in national economy. Nevertheless, a huge investment of foreign currency from Asian Development Bank (ADB) and World Bank was made for the industry.

However, the situation has been changed now, the price of rubber has been increased at least three-folds, at a very encouraging level. Now rubber is one of the most profitable commodities in the present market. Therefore, it is the right time to think forward for further development revising the policy and rectifying the faults through applied research and appropriate technology to achieve highest productivity and profit.

Rubber exports rose 103pc during JulyJanuary

Posted on February 15, 2011 | Leave a comment

http://www.theindependentbd.com/business/finance/34428-rubber-exports-rose-103pc-duringjuly-january.html Rubber exports rose 103pc during July-January AKRAM HOSSAIN Dhaka, Feb 14:Rubber producers and exporters have witnessed exponential growth in the last seven months, on the back of rising demand in international and domestic markets. During JulyJanuary, earnings from rubber exports stood at USD 10.06 million, an increase of 103.64% over the corresponding period in the previous year, according to data published by Export Promotion Bureau (EPB). Target for rubber exports were set at USD 5.71 million, for the period under review. Businessmen from 54 countries, specially India, China, Saint Barthlemy, Malaysia, Turkey, Singapore and Pakistan are showing keen interest over Bangladeshi raw and processed rubber for its quality, Syed Moazzam Hossain, president, The Bangladesh Rubber Garden Owners Association (BRGOA), told The Independent. This year, we are not far from the targeted rubber exports, he added. The global shortage and price-hike of rubber were forcing international traders to treat Bangladesh as an alternative source, he pointed out. The budget has imposed 15 per cent VAT on us, restricting the sectors growth, Hossain said. Local planters sell rubber latex sheets, which are perishable items, for industrial use, he said, adding, Sandals made from raw rubber is supposed VAT free. But producers still have to fork out VAT. Imposing VAT on raw rubber is unfair, as the government has withdrawn VAT from all agrobased products, such as rice, jute, potato or tomato, to boost growth in these sectors, he said. A rubber tree absorbs more carbon dioxide than other trees, Hossain said, adding that the new VAT will also threaten the environment and discourage plantation.

A 17-member delegation had visited Malaysia from January 26 to 29, to gain knowledge and exchange views on rubber plantation and processing, explore areas of possible cooperation, and establish business network between rubber planters of the two countries, he added. Growers said a large number of foreign traders were looking for rubber here, as its price in the local market was lower than that of current global prices, which has gone up in an unprecedented manner. Cultivation of rubber is relatively new in Bangladesh, compared to other countries. The government has been encouraging plantations in the hill areas, since 1980. About 45,000 acres of land have been allotted to the BFIDC so far, and 32,500 acres to private owners, for rubber plantations.

Sudden spurt of foreign demand for local rubber

Posted on April 30, 2010 | Leave a comment

http://www.newagebd.com/2010/may/01/busi.html#1 Sudden spurt of foreign demand for local rubber Shakhawat Hossain Local rubber growers are having a good time as a growing number of international traders are looking for rubber in Bangladesh because of the current shortage of the item in the global market. The Bangladesh Rubber Garden Owners Associations general secretary, Harun-ur Rashid, told New Age on Thursday that businessmen from Turkey, Pakistan and India have come here looking for rubber. Some growers have already shipped out around 1,200 tonnes of rubber in the last six months and many other orders have already been received. The global shortage and price-hike of rubber were forcing the international traders to treat Bangladesh as an alternative source, he added. Growers said that a large number of foreign traders were looking for rubber here as its price in the local market was at least $1 lower per kg than that of current global price, which has soared in an unprecedented manner. According to the London-based Financial Time, the price of natural rubber, the commodity used to make products ranging from tyres to condoms, has hit an all-time high [above $3.50 per kg] in the current month after a severe drought in Thailand, the worlds largest producer, curtailed supplies.

The price-hike of rubber has broken one of the longest standing price records in commodities, dating back to 1952, when fears about the potential spread of the Korean War to key South-East Asian rubber-producing countries triggered panic buying, added the Financial Time. Besides the international shortage that has led to traders coming here, local consumption of rubber has also gone up substantially, elating the local growers, said a senior official of the Bangladesh Forest Industries Development Corporation. The BFIDC, the state-owned rubber plantation, cleared its stock-lot of 6,000 tonnes of rubber four months ago, though it has been facing difficulties in clearing its stock-lot since 2008, he added. The rubber growers said that the country produces about 10,000 tonnes of rubber per year with BFIDC accounting for 60 per cent of the production. The other 40 per cent comes from the private growers who were permitted to plant rubber trees in the 1980s. The country has attained self-sufficiency in rubber, which is mainly bought by footwear industries and tyre and tube producers. Rubber has huge export potential, especially to India that imports nearly 1,00,000 tonnes of rubber to meet its internal demand of 10,00,000 tonnes annually.

Local firms seek to shore up foothold in tyre business

Posted on December 28, 2009 | Leave a comment

http://www.thedailystar.net/newDesign/news-details.php?nid=119537 Local firms seek to shore up foothold in tyre business A salesman arranges locally made tyres at a shop in Dhaka. Bangladesh is missing out on opportunities to tap the rising local demand for tyres in absence of large manufacturers here.Photo: STAR Sajjadur Rahman Local manufacturers are coming up to tap growing opportunities in tyre business that now depends heavily on imports. Husain Tyre, which started production in 1996 with three-wheeler scooter tyres, makes more than 10 types, including light ones for small trucks and microbuses.

Gazi Group, a plastic product manufacturer, started producing automotive tyres three years ago. Now Meghna Group plans to enter the market soon. Initially, we will make motorcycle tyres by June next year. We have already started producing tubes for motorcycle tyres, said Mizanur Rahman, chairman of Meghna Group. Despite a growing use of automobiles here over the years, Bangladesh is missing out on opportunities to tap rising demand for tyres in the absence of large manufacturers. On the other hand, Nepal and Sri Lanka, relatively small markets, produce tyres to meet their domestic demand. According to Bangladesh Road Transport Authority, around 150 new motorised vehicles are added to city streets every weekday. A total of 2,18,000 new vehicles were registered in the last two and a half years. Bangladesh spends Tk 1,000 crore to import up to 15 lakh tyres a year, according to importers, distributors and sellers. Manufacturers, such as Husain and Gazi, are yet to pick pace and compete with giant Indian and Japanese tyre makers. The market is dependent on imports, said Mohammad Muzahid, an executive committee member of the Tyre Merchants Association and an importer of Indian Good Year tyre. Although there is no exact data on the market share of imported and locally produced tyres, Humayun Kabir Liton, office secretary of Tyre Merchants Association, said the use of local tyres is rising fast. Local tyres will be able to grab a 10 percent market share in the next couple of years, said Liton, who has been in the business for nearly 15 years. The tyre market has been growing fast, but local big companies did not make an entry to this sector as it requires large capital investments and consistent power supplies. Years ago, two big names Rahimafrooz and Nitol moved to produce automotive tyres, but their plans did not carry through for high capital investment requirements and dependence on the import of raw materials. When we took an initiative to produce tyres locally, more than seven years ago, the market was not as big as it is now, said Niaz Rahim, a director of Rahimafrooz Group. At the time, the investment cost was estimated at Tk 250 crore now it will be no less than Tk 400 crore for the same project, he added. Indias JK Tyre also tried to set up a joint venture to make tyres in Bangladesh several years ago.

Importers and sellers found the scarcity of raw materials in the country as an obstacle to producing tyres in Bangladesh. Rubber, chemicals, carbon and yarn all have to be imported, said Humayun Kabir, another importer. The poor supply of power also discourages investors. Bangladesh imports at least 60 percent of its tyre requirements from India, followed by China, Indonesia, Japan and Thailand, industry people said. Prices of tyres have also quadrupled in the past decade, riding on growing demand. Niaz Rahim of Rahimafrooz did not rule out the possibility of a joint venture to manufacture tyres. Zakir Husain, managing director of Husain Tyre, declined to comment on the countrys tyre market.

[05 Feb] Bangladesh: Rubber Farming on Amid a Volley of Questions Friday, February 5, 2010

At least 20,000 acres of land is being used for rubber cultivation in Chittagong Hill Tracts (CHT).

Chittagong Hill Tracts Development Board (CHTDB) is cultivating rubber on some 15,000 acres of land under rubber cultivation project while cultivation is going on some 5000 acres of land under private initiative, sources said.

CHTDB has about 26 lakh rubber plants on 13,200 acres of land (200 plants on each acre) while some 5 lakh more plants are growing on about 5,000 acres of land under privet ownership.

Asian Development Bank (ADB) provided Tk 52.5 crore in two instalments for the rubber cultivation project from 1979 to 1995 and Tk 13.5 crore came from public exchequer after signing of the CHT peace accord in 1997.

Some 3,300 stakeholders of the project alleged that they are not getting 60 percent of total income as per the agreement they signed with the CHTDB. They alleged the authority is depriving them of their due share producing false data of production and income.

CHTDB officials said many farmers have become solvent through rubber cultivation while farmers and agriculturists term it non-profitable and hazardous to health.

About 50,000 people, who have been living in rubber garden areas or are engaged in rubber production, are suffering from different diseases, sources said.

Binoy Bhusan Chakma, a farmer of Bhaibonchhara in Sadar upazila of Khagrachhari, said most of the farmers are sufferings from different diseases as they are not aware of the bad effects of rubber cultivation.

Amiya Kanti Roaza, Assistant General Manager of the rubber cultivation project, told this correspondent that there is no bad effect of rubber cultivation. If it is harmful to human health, government would never initiate such a project, he added.

Khagrachhari District Horticulture Officer Mohammad Mizanur Rahman said rubber garden workers suffer from various skin diseases.

General Manager of Rubber Project Mohammad Ali Hydar said many farmers have been benefited through rubber cultivation on fallow land.

Rubber Industry had its inception in 1951, when in East Pakistan, there were only two rubber manufacturing COTTAGE INDUSTRY units with just 8 workers. In 1958, there were four rubber products making units and in 1983, Bangladesh had six rubber based footwear industrial units with Tk 619,700 as fixed investment and 40 workers, of which 22 were members of the owner families. Rubber plantation was commercially introduced first in the country in 1960-61 and up to 1970, a total of 7,000 acres was planted. After the independence of Bangladesh in 1971, the new government paid attention to rubber plantation and growth of rubber industry. Rubber plantation was included as a special programme in the country's First Five-Year Plan. The BANGLADESH FOREST INDUSTRIES DEVELOPMENT CORPORATION (BFIDC) was asked to take up a total of 10,000 acres of rubber plantation and the annual production target was estimated at 350 tons of rubber by 1977-78. The main aim of rubber development was to increase domestic seed supply, create training facilities, rehabilitate old plantations, and expand them under a larger plantation programme. The target for rubber plantation area during the Third Five-Year Plan period (1985-90) was 67,000 acres, of which 40,000 in government sector and 27,000 in the private sector. Chittagong Cox's Bazar, Sylhet, and Chittagong Hill Tracts were identified as the major rubber areas. These targets could not be achieved because of delays in land acquisition and preparation, shortage of fund and failures in development of infrastructural facilities. In 1995, the rubber plantation area in the public sector was 31,118 acres and the production of raw rubber was 7,830 tons. The private sector owned 16,527

acres for plantation of rubber but planted only a part of the total area producing only 250 tons. The domestic production of raw rubber could meet only 35% of the country's demand. The rubber industry in Bangladesh got a good opportunity for development in late 1990s, especially after the signing of the Chittagong Hill Tracts Peace Accord in 1997. The Fifth Plan for 1997-2002 treated the three hill districts and part of Mymensingh and Tangail as especially suitable for rubber cultivation. The Bangladesh Forest Industries Development Corporation had some experience in rubber plantation in these areas, where it developed 32,500 acres of land for rubber plantation during the period between 1960 and 1966. In 1999, rubber plantation in these areas had about 4.36 million rubber plants for production of about 4,000 tons of raw rubber per year. Until the end of 2000, the corporation produced 34,123 tons of raw rubber and the value of the output has been estimated at Tk 1.53 billion. BFIDC has 15 gardens - 7 in Chittagong, 4 in Sylhet, and 4 in Tangail-Sherpur zone and they supply raw rubber to the rubber goods manufacturing units, which are now about 60 in number. The corporation now runs a technical training institute in Fatikchhari. Typical products made of rubber in the country are the hawai chappal (slippers), soles of leather based footwear, belts for use in different purposes, hose pipe, accessories for various machinery, and tires and tubes for vehicles like bicycle, rickshaw, baby taxi, motor car and trucks. The year 1997 has been marked by the entry of Bangladesh in the rubber goods export markets. That year, Rainbow Associates, a private firm exported an 18ton consignment of rubber to Russia. Encouraged by the example, the government took an initiative of gear up drive to tap new markets through foreign missions. This gave an impetus to further development of rubber plantation, which provided employment to about 10,000 people in 2000 in the 32 plantations covering a total area of 65,000 acres. [M Habibullah]
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Bangladesh to Double Rubber Production by 2020

Good news for the beleaguered tyre industry, executives in the Bangladeshi rubber industry have announced that they intend to double rubber production over the next 12 years. Currently the

country has a production capacity of 30,000 tonnes, but they will double that in an attempt to meet demand on the export market. Local news reports quote Dr Hossain Zillur Rahmans announcement that Bangladesh is starting to export rubber to Turkey, and it is hoped that they will get certification from Bridgestone. According to Dr Rahman, Bridgestones certification may take the Bangladeshi rubber industry to a new height. This is good news for the worlds tyre industry. The laws of supply and demand have forced prices up over the last year, but this situation will be eased as this new source comes on line. In addition, Bangladeshs rubber is relatively cheap at about half the price of rubber from other sources. The vice-president of the Bangladesh Rubber Garden Owners Association, Motahar Chowdhury, has been critical of his governments failure to support the emerging rubber industry, and their lack of interest in what could be a lucrative export market. He stated, Government has neither set up any administrative wing to help the sector, nor formulated any policy for the industry. Bangladeshi rubber will be a welcome addition to the global market. (http://www.etyres.co.uk/news/bangladesh-to-double-rubber-production-by-2020-236.html)