Nitol looking to assemble Tata Nano locally

[Contrarian]

Think this same situation in India. Suppose any company firing its local employees in India after investing of another company. Like any giant BD company will invest in Airtel and then Airtel reduces its local Indian employees. Then how do you will feel? I'm sure that you will talk in 180 degree reverse tone then.

Thats normal. Most companies when they acquire other companies reduce headcount. In the end, however, if the company plans to compete in the open market, it has to offer better rates to customers. So the customers win in the end.

You guys dont really get the concept of free market economy. Its like how we were before 1991.

 

[TopCat]

You are copy pasting number without complete knowledge.
6-7% looks good enough to you and sure it is. But what is the total GDP?

6-7% of a 1.4 trillion dollar economy of India is 85-100 billion dollars. But for Bangladeshi Economy of 228 billion dollars it would be just 12-14 billion dollars which are simply not enough to start industry, you have to spend that on education and basic infrastructure also. It will take 15-20 years till the time BD can actually start its own projects, till then it should reap the benefits of foreign investors.

Our total GDP is fine 100 Bln compared to Indian 1.3 Trillion. We revised PPP factoring in 2005/06 which India did not and maintaining 1947's number. Thats why you are seeing the 228 bln PPP.
Sure we are not spending any less in Education and Health and they are just fine. We need foreign investment but we dont want any foreign looters. Got a be very carefull on that. Good example is our stock market, in 1996 we had a turbulant created by foreign portfolio investment and plundered all the money of small investor. Now we put our regulations in place on foreign investment in stock market and only the real long term investor are allowed to invest there. The end result is 1500 Cr. Tk. daily turnover and projecting 3000 Cr. by year end by our own money compared to 5500 Cr Rs bombay stock exchange where there is a significant amount of foreign portfolio investment. For a country like BD its phenomenal.

 

[TopCat]

Thats normal. Most companies when they acquire other companies reduce headcount. In the end, however, if the company plans to compete in the open market, it has to offer better rates to customers. So the customers win in the end.

You guys dont really get the concept of free market economy. Its like how we were before 1991.

Our economy is free since 1979.

 

[Isaq Khan]

Sir we are growing 6-7% without any FDI unlike India. We have enough domestic savings 29% (some counts 35%) of our GDP. We just need to invest those savings to get those growth rate to 8% and above. The only problem here is the infrastructure and power which govt is working on.
Money is not a problem here and I prefer domestic money instead of FDI, but technology intensive FDI is not bad , so that we learn some.

6-7% is nothing as BD economy is so small.

Even If Indian economy grows @ 1% per annum than the growth is 14% when compares to BD as India's economy is 14 times bigger than BD.

Even Bihar the poorest state in India have 11% growth rate.

So, my point is that BD can't progress in isolation.

China has opened is doors in 1979, 12 years before India and see the results.

The made in China is not always made by Chinese. As foriegn companies of US, UK, Germany, India hire factories and facilities and manufactures in China. For outsider the made in china = made by chinese which in reality its not true.

 

[TopCat]

6-7% is nothing as BD economy is so small.

Even If Indian economy grows @ 1% per annum than the growth is 14% when compares to BD as India's economy is 14 times bigger than BD.

Even Bihar the poorest state in India have 11% growth rate.

So, my point is that BD can't progress in isolation.

China has opened is doors in 1979, 12 years before India and see the results.

The made in China is not always made by Chinese. As foriegn companies of US, UK, Germany, India hire factories and facilities and manufactures in China. For outsider the made in china = made by chinese which in reality its not true.

You missed my point here.
I am not saying 6-7% is enough, we need at least 10% growth rate to get ourselves out of developing country status by year 2021.
What I am saying is that we should be very carefull on FDI as we should look at them on case by case basis also domestic investment should be more preferred option. You should not compare 1% of Indian growth rate to BD as 1% of Indian growth is spread over more than a billion people in India. Bihar had bigger growth rate as because GOI is investing more money in Bihar on development as it is the most underdeveloped area and means nothing. Afganistan also posted 12% growth rate last year.

 

[eastwatch]

Eastwatch
Perhaps you mean well but we need to foresee biger picture here. Tata is a giant and once it make it way into bd than our own potential home grown industry will die out. They will not be able to compete with gaint like tata.

you heard about walton. This industry has opened our eyes. It is doing phenomenal job and become role model for others to follow. It is 100% bangladshi own and they have done it without any foregin help.

You may also heard about the place called jinjirah where small electronic and mechanical products like fan are being build for local market. These guys got enormous potencial yet not able to grow because lack of goverment funding and electricity.

Rahim afroz building the bigest battery factory in SA. Our ship industry already made is mark in international arena.

We have the man power and technical know how but need government patroniziation. Building car is not a big deal in these days. we already have basic infrastructure in place. All we need massive funding for local industry like walton to reach maximum height. Let us build bd with bd's and not with bharati.

I understand your concern. However, not only TATA, but all the car industries are very big. It is not that I have any personal affinity towards TATA or any other foreign company. But, we have learned in our childhood, 'Bara Jodi Hote Chao, Choto Hou Age.'

A car assembling plant may be built by a local or a foreign company. It may also be a joint venture company. But, it will be built by the companies concerned, and not by the govts. In case of BD, Nitol is the TATA agent and it wants to build its plant with its own money. So, BD govt cannot do anything about it. In the future, another agent or company may choose Toyota, VW or Renault. It is their choice.

Unfortunately, BD has not yet attracted any foreign maker to build an assembly plant. Car demand is very low, about 35,000 units per year. This is because of heavy import tax and shortage of roads. A small car like Nano, if assembled in BD, will be very cheap. Even a mid-level middle class family can then afford a car.

The car assembled in BD, irrespective of the fact that it is basically a TATA product, will help the economy. However, except a few technical personnels all other workers must be BD citizens.

Once an assembling plant is here, there will be others who would rush to build their own assembling plants. BD population will get jobs and the economy will be gainer.

 

[eastwatch]

You are copy pasting number without complete knowledge.
6-7% looks good enough to you and sure it is. But what is the total GDP?

6-7% of a 1.4 trillion dollar economy of India is 85-100 billion dollars. But for Bangladeshi Economy of 228 billion dollars it would be just 12-14 billion dollars which are simply not enough to start industry, you have to spend that on education and basic infrastructure also. It will take 15-20 years till the time BD can actually start its own projects, till then it should reap the benefits of foreign investors.

BD has a $100 billion GDP in real terms and not in PPP. In case of India, it is about $1.3 trillion real. Also note that our GDP increased by 5.9% last fiscal and economists here are predicting a rise of at least 6% this fiscal. Also note, when we fix our electricity problem in the next two to five years, BD GDP will rise by at least 8% per anum.

However, nothing comes out if the idle capital that we have in our Banks is used. About 35,000 Crore Taka (or $5 billion) remain idle now. There are some reasons behind this. BD industrialists are not waiting for 20 years that you have predicted. They are already investing wherever they find they can make profit.

Note that our savings ratio is more than 29%, but not all these savings can be invested at the moment. Among many other reasons, the most severe is the shortage of power. When this is solved, the available capital at the tune of at least $5 billion will be fully invested in industries every year.

If the capital:output ratio is assumed at 3:1, then each year's new investment of $5b will raise the economy by an additional $1.5 billion every year. GDP is now increasing by about $6 billion per year. When more power is available then the increase will be about $6.5 billion at that juncture.

In this way, when more and more savings are invested in each passing year, a high 10% GDP increase will not remain a daydream after a few more years. As Iajdani mentioned before, BD people do not really like FDI. It is a kind of slavery and the foreigners take out the profits. BD must be developed by its own citizens and not necessarily by FDI money.

 

[TopCat]

I understand your concern. However, not only TATA, but all the car industries are very big. It is not that I have any personal affinity towards TATA or any other foreign company. But, we have learned in our childhood, 'Bara Jodi Hote Chao, Choto Hou Age.'

A car assembling plant may be built by a local or a foreign company. It may also be a joint venture company. But, it will be built by the companies concerned, and not by the govts. In case of BD, Nitol is the TATA agent and it wants to build its plant with its own money. So, BD govt cannot do anything about it. In the future, another agent or company may choose Toyota, VW or Renault. It is their choice.

Unfortunately, BD has not yet attracted any foreign maker to build an assembly plant. Car demand is very low, about 35,000 units per year. This is because of heavy import tax and shortage of roads. A small car like Nano, if assembled in BD, will be very cheap. Even a mid-level middle class family can then afford a car.

The car assembled in BD, irrespective of the fact that it is basically a TATA product, will help the economy. However, except a few technical personnels all other workers must be BD citizens.

Once an assembling plant is here, there will be others who would rush to build their own assembling plants. BD population will get jobs and the economy will be gainer.

Tegaj is building their car manufacturing unit near Meghna Ghat on a 300 acre land. They will be producing 50000 unit per year to export to Europe. They will have their own specific BD brand to market in BD.
Walton also in a look out to manufacture car here.