Samsung opens two appliance plants in Bangladesh

[Bilal9]

We have better growth rate than ASEAN.
None if the ASEAN countries are doing anything great.

You do have a point. Maybe being part of ASEAN now is not as attractive as it once was.

However I have to put forward the argument that Thailand and Indonesia in particular were once in our position in the 1980s, with labor intensive exports only like garments and shoes (same like Japan prior to World War II and Taiwan/Korea thereafter in the 70s). In fact Thailand and Indonesia are still in the garments and shoes export market, but they are being rapidly passed over, favoring Vietnam and Bangladesh.

ASEAN countries mostly are quite heavily industrialized except Thailand and Indonesia which are a step ahead of us, with much higher labor cost. IMHO Thailand is who we want to emulate somewhat, as they are a higher cost competitor. Export led growth in Indonesia are a mix, and probably not as successful as in Thailand.

So what is Thailand exporting that we are not?

Rubber Products, jewelry, automobiles, computers and electrical appliances, white goods and my favorite, consumer electronics products like Nixon DSLR's and lenses. These are all sectors with moderate to high value-addition and where we want to be in the next.

So,

If we look at our present situation in these sectors......

Rubber products,

Automotive & Bicycles tyres and tubes: minimal investment, almost no rubber produced locally, dependent on concentrated latex input imported from either Kerala or Malaysia. Minimal or No export
Footwear: some production, local consumption only.
Belts and hoses: No export
Camelback and latex products such as gloves etc.: No export

For Jewelry and computer products exports, the scenario is dismal and similar.

The bright spot seems to be white goods such as kitchen electrics, kitchenware such as non stick cookware and consumer electronics products such as what we are producing domestically by the likes of global brands like Samsung.

Since China and Korea has moved up the value addition chain, we should make a really strong effort to establish their OEM manufacturing spots.

With our labor cost approximately one third that of even China, we are well situated to take advantage of this opportunity compared to Thailand (mostly Japanese investments) and Indonesia (not a China-friendly country).

 

[idune]

We should have lobbied heavily to join ASEAN when it was formed. The problem was a lack of vision and the habit of continually pandering to India, which over the years has caused more harm than good.

Khaleda's husband did realize this somewhat, with his early 'Look East Policy'. But of course Khaleda surrounded herself with either idiots or thugs and kicked out the only few people who were anywhere near talented. That policy was never followed through to where it would bring lasting change.

End result is we fell at least twenty years behind.

I know there are detractors to the idea of us joining ASEAN. However I'd argue the benefits outweigh the harm.

We ourselves mooted the idea of SAARC in this country (Zia). However in hindsight we underestimated the rivalry, both military and Political between India and Pakistan.

Bad blood could not transcend sound ideas about trading like the EUROPEAN Common market.

kz also pursued look east policy but her incompetent and surrounding people could not carried it through. Also awami and Indian Dalal class were making noice that Bangladesh was pushing look east and forgetting their master India.

 

[Nike]

You do have a point. Maybe being part of ASEAN now is not as attractive as it once was.

However I have to put forward the argument that Thailand and Indonesia in particular were once in our position in the 1980s, with labor intensive exports only like garments and shoes (same like Japan prior to World War II and Taiwan/Korea thereafter in the 70s). In fact Thailand and Indonesia are still in the garments and shoes export market, but they are being rapidly passed over, favoring Vietnam and Bangladesh.

ASEAN countries mostly are quite heavily industrialized except Thailand and Indonesia which are a step ahead of us, with much higher labor cost. IMHO Thailand is who we want to emulate somewhat, as they are a higher cost competitor. Export led growth in Indonesia are a mix, and probably not as successful as in Thailand.

So what is Thailand exporting that we are not?

Rubber Products, jewelry, automobiles, computers and electrical appliances, white goods and my favorite, consumer electronics products like Nixon DSLR's and lenses. These are all sectors with moderate to high value-addition and where we want to be in the next.

So,

If we look at our present situation in these sectors......

Rubber products,

Automotive & Bicycles tyres and tubes: minimal investment, almost no rubber produced locally, dependent on concentrated latex input imported from either Kerala or Malaysia. Minimal or No export
Footwear: some production, local consumption only.
Belts and hoses: No export
Camelback and latex products such as gloves etc.: No export

For Jewelry and computer products exports, the scenario is dismal and similar.

The bright spot seems to be white goods such as kitchen electrics, kitchenware such as non stick cookware and consumer electronics products such as what we are producing domestically by the likes of global brands like Samsung.

Since China and Korea has moved up the value addition chain, we should make a really strong effort to establish their OEM manufacturing spots.

With our labor cost approximately one third that of even China, we are well situated to take advantage of this opportunity compared to Thailand (mostly Japanese investments) and Indonesia (not a China-friendly country).

hmm,

not quite true, Indonesia even during the 70s decade never pursue export driven economic growth policy like Thailand, Vietnam and Singapore do in the past or right now (Vietnam). Instead Indonesia since long pursue consumption driven or led economic growth, relying herself on internal economic markets. Till 2006, export surplus mainly come from cheap commodity based export products like Oil, Gas, Coal, Coconuts, Cocoa, Woods, and among other (Indonesia is one among few who benefitted handsomely during oil boom in 70's). Industry and manufacturing efforts mainly is for local consumption as till now there is lack in supply in many items and sector.

But since reformation era, and the rise of Sri Mulyani as Indonesia Finance Minister and ranks of Liberal School thought in Senior ranking Indonesian minister (like Boediono, Chairul Tanjung, Thomas Lembong, Agus Martowardjojo and other) Indonesia adopting a strategy to pursue more export on Value added manufacturing products as part of effort to contain the onslaught of imported products from aboard. Thus in result, as just in one decade Indonesia manufacturing output and value added products value is right now in tied with United Kingdom and keep rising as more investment and infrastructure in heavy Industry is keep pouring to Indonesia. Meanwhile at the same time Indonesia right now had become net importer of raw oil and gas commodities from aboard to sustain our economic and industrial growth.



https://www.ceicdata.com/indicator/indonesia/industrial-production-index-growth

http://www.bi.go.id/sdds/

http://www.thejakartapost.com/amp/n...a-one-of-the-worlds-top-10-manufacturers.html

though Indonesian average perception about China is not really good, but on business side the Chinese seems more eager to invest their money and cooperate with Indonesian in many sector even including defense industrial parks and high tech investment in communication and IT sector and satellite technologies through ToT programme with various Universities and institutes in Indonesia. How about Chinese realization of investment in Bangladesh?

• BUSINESS

China strengthens grip on Indonesia




Farida Susanty | The Jakarta Post | Jakarta
Jakarta, posted: Thu, November 24, 2016 | 07:14 am

China has further cemented its role as one of Indonesia’s strategic partners going forward with the Asian powerhouse’s commitment to continue with the rising trend of investment flowing into the archipelago.

Speaking in a forum attended by Indonesian and Chinese business players, Chinese Ambassador to Indonesia Xie Feng said China saw great potential for bilateral cooperation between the two countries.

China’s realization of foreign direct investment (FDI) in Indonesia grew by a staggering 291 percent to US$1.5 billion from January to September compared to the same period last year, according to Investment Coordinating Board (BKPM) data.

“China will continue to encourage more enterprises to invest in Indonesia and help speed up Indonesia’s economic growth,” Xie said on Wednesday.

President Joko “Jokowi” Widodo has held five meetings with Chinese President Xi Jinping in the past two years, a sign of deepening ties between the two countries that look to expand economic cooperation from electricity and mining to new sectors such as e-commerce and tourism.

Both countries have recorded investment cooperation in more than 3,000 projects over the last five years, to the point that approximately one fourth of Indonesia’s electricity is generated by power plants built by China, the world’s second-largest economy.

Meanwhile, tourism is deemed as promising with Jokowi targeting half of his 20 million foreign tourist target by 2019 to come from China. As of September this year, 1 million Chinese tourists visited Indonesia.

This year, most investment from China has been seen in the steel and mineral processing sectors, which includes smelters in Sulawesi. Chinese investors are also going large in the cement and automotive industries, signaling a commitment to Indonesia’s infrastructure push, with ventures in cement plants in Kalimantan and Papua for instance.

The strength of cooperation between the two Asian countries is also evident with the investment commitment from China Development Bank (CDB) of $14.4 billion for 57 projects since it entered Indonesia in 2006, although only $9.7 billion of the commitment has been realized.

Going forward, CDB is looking at projects on power plants, as well as sea transportation-related infrastructure.

“Indonesia and China have [...] synergy on the Chinese Silk Road concept and Indonesia’s aim to be [a] global marine fulcrum. CDB wants to actively cooperate in that sector,” CDB general manager Xiamen branch Yang Aiwu said.

CDB, however, gave no comment on the reason behind the delayed disbursement for Indonesia’s first high-speed railway connecting Jakarta and Bandung, West Java, which requires $5.1 billion investment that may well be mostly funded by a CDB loan.

Chinese investors, now one of Indonesia’s top trading partners and a top-five foreign investor in the country, previously saw a low ratio of investment realization-to-commitment from 2005 to 2014 as only 7 percent of Chinese investment commitment was realized during the period, BKPM data showed.

“In terms of doing business, they are pretty fast at making cooperation agreements, but then it becomes very difficult in the execution phase,” said Indonesian Chamber of Commerce and Industry (Kadin) vice chairman for international relations Shinta Kamdani.

In tackling the issue, the BKPM earlier this year launched a special information desk — the “Chinese desk” — to facilitate Chinese investors and assist them with their investment plans.

The Chinese Embassy in Indonesia highlighted land acquisition difficulties, a changing policy environment, as well as difficulties in acquiring work permits for foreign workers as the top-three hassles Chinese business players faced in investing in the country, said counselor for economic and commercial affairs Wang Liping.

Meanwhile, Center for Reform in Economics (CORE) Indonesia research director Mohammad Faisal expected that investment from China would significantly increase in various sectors.

“Tourism [investment] has been pretty insignificant. We expect it [China] to invest in Indonesian tourism destinations next year, as well as other sectors such as telecommunications,” he said.

Faisal also warned that investment from the Asian giant was usually followed by Chinese workers and products flowing into the country, which could potentially affect domestic human resources.

@Nilgiri @Aung Zaya

 

[Zabaniyah]

We should have lobbied heavily to join ASEAN when it was formed. The problem was a lack of vision and the habit of continually pandering to India, which over the years has caused more harm than good.

Khaleda's husband did realize this somewhat, with his early 'Look East Policy'. But of course Khaleda surrounded herself with either idiots or thugs and kicked out the only few people who were anywhere near talented. That policy was never followed through to where it would bring lasting change.

End result is we fell at least twenty years behind.

I know there are detractors to the idea of us joining ASEAN. However I'd argue the benefits outweigh the harm.

We ourselves mooted the idea of SAARC in this country (Zia). However in hindsight we underestimated the rivalry, both military and Political between India and Pakistan.

Bad blood could not transcend sound ideas about trading like the EUROPEAN Common market.

I think Zia should be commended for trying. His wife certainly isn't savvy though. Jamaat was running on a fool's errand all along.

I don't think Bangladesh would necessarily need to join ASEAN back then. Let's ask ourselves, what would we had gained by joining ASEAN? Many of those countries like Malaysia and Indonesia are very rich in resources. In case of Singapore, they had a very matured network for business that brought all that money into one pot. Not all ASEAN members are as advanced though. Take Laos or Cambodia for example. I won't mention Burma because they too have a lot of resources, but did not progress for reasons we already know.

If anything, lobbying should be done where the balance of power truly matters. ASEAN isn't that.

I would say a sound policy for attracting both foreign and local (yes that's also very important!) investment is what is currently needed to create jobs and wealth while keeping Muhith's ideas far away at the same time. A strong security establishment that ensures people's rights and free speech would be nice too, but I guess I'm dreaming.

As for the 'bad blood' part, we don't need any part of it. We could have done better if we had a strong security establishment and a system which focuses more on civil rights rather than cultural in the first place. At times, I don't know which part of 1971 covered that or was it at the benefit of someone else even they weren't clear about? If those rights and security were in place, and we had some form of treaty with our big neighbor, India along with their rivalry with Pakistan would have been a distant thought at best. These do not cost a lot of money. See, for a small country with a big neighboring country, it is necessary to have treaties in perspective of the smaller country on a range of issues so that the bigger one cannot dominate the smaller one too easily. It is partly how civilizations thrive in a civilized way. Though, I can't say how credible even that can be. There are some stark realities that we are yet to acknowledge. Much like how the Israelis do to take care of themselves. A transparent giant dome acting like shield protecting the citizens from all the ills of whatever is out there. But I guess I'm dreaming again.

Like I said, lobbying is to be done where the balance of power (and money) truly matters. We can start with the largest consumer market in the world - The US by lifting the GSP restrictions. I'm sure it can start from somewhere from then. Regarding the GSP issue, I say to Bangladesh that instead of begging, do some real lobbying having some objectivity in mind. They can do it. Does senior leadership have objectivity in mind solely for the people and country? I doubt it. The Americans do not happen to like them for some reason.

I would also suggest a more 'global' approach with regards to the various large businesses of Bangladesh. Don't be shy to send people abroad and invest abroad all for the benefit of the country in mind. Don't be stupid and selfish ultra rich folks of Bangladesh.

 

[Bilal9]

Thanks for your thoughts Loki Bhai, you made some points worth observing and they need further discussion.

As for the 'bad blood' part, we don't need any part of it. We could have done better if we had a strong security establishment and a system which focuses more on civil rights rather than cultural in the first place. At times, I don't know which part of 1971 covered that or was it at the benefit of someone else even they weren't clear about? If those rights and security were in place, and we had some form of treaty with our big neighbor, India along with their rivalry with Pakistan would have been a distant thought at best. These do not cost a lot of money. See, for a small country with a big neighboring country, it is necessary to have treaties in perspective of the smaller country on a range of issues so that the bigger one cannot dominate the smaller one too easily. It is partly how civilizations thrive in a civilized way. Though, I can't say how credible even that can be. There are some stark realities that we are yet to acknowledge. Much like how the Israelis do to take care of themselves. A transparent giant dome acting like shield protecting the citizens from all the ills of whatever is out there. But I guess I'm dreaming again.

1971 IMHO helped India as much as it did us. For starters, it made them rest easy and relieved them of a thorn on their side at the time so they could fight a single front war instead of a two front one. It also gained them a huge regional market worth about seven billion dollars a year formally, and as much informally through smuggling totalling some USD 12 to 14 billion a year (I'd say more lucrative than Nepal or Sri Lanka) than they had previously, with no price paid economically through imports.

We only have to blame Bhutto and gang on what they did in 1971 for selfish reasons, yet they had no vision that Pakistan United, could rival India in manufacturing prowess as it does in defence today. Inclusive development is not a part of our history in the subcontinent (we possess garbage for brains instead of being visionary, we always want to dominate supposedly 'meek' populations) and we will see this further manifest itself in India's north/south egotistical cultural divide. Time will tell.

I don't see India's Chanakya south block diplomacy to dominate us reducing anytime soon, a placating foreign policy will keep India at bay at least until we gain strength economically and properly equip to defend ourselves. Everyone likes to dominate a sitting duck, it's the nature of garbage human beings in South Asia. As long as Indians don't think we're a present or emerging threat (I don't think we will be in that space anytime soon) then they are fine with us and will leave us alone hopefully. Disrupting our trade/manufacturing activity or fomenting unrest in Bangladesh will create an unstable quarter on their eastern flank to spell trouble in their own country and they know that very well.

Like I said, lobbying is to be done where the balance of power (and money) truly matters. We can start with the largest consumer market in the world - The US by lifting the GSP restrictions. I'm sure it can start from somewhere from then. Regarding the GSP issue, I say to Bangladesh that instead of begging, do some real lobbying having some objectivity in mind.

Lobbying is the need of the hour. Pakistanis and Indians all have strong trade lobbies in Washington, and our lobbying activity is not as strong as theirs. This is a shame and a crying need of the hour. Reestablishing GSP for US markets and establishing new markets in South America is necessary immediately.

Coming back closer to the subject of the thread- Bangladesh is a better destination than any country to replace China's Low-cost manufacturing role which played a big part in making China the second largest economy in the world by 2010, compared to the ninth largest in 1980.

Now China is rapidly moving into medium to high-tech manufacturing as its labor costs have risen. Manufacturing goods in China is now only 4 percent cheaper than in the United States, in large part because yearly average manufacturing wages in China have increased by 80 percent since 2010. It is in response to this that China, backed by billions of dollars in investment from its government, has vigorously moved into higher value manufacturing.

True we are setting up a hundred SEZS and are gearing up rapidly to produce labor-intensive commodity-type products like apparel, shoes, toys, textiles and basic consumer electronics and home electric products. Our two decades of exporting textile and footwear products have put us ahead of a lot of competitors like Malaysia, India, Thailand, Indonesia, and Vietnam, and here's why, in addition to being the lowest cost competitor by far (our labor cost is less than half of India's, and India's labor cost is the lowest in the group).

Thailand and Malaysia : Thailand and Malaysia are more focused on high- and medium-tech manufacturing rather than being the next centers of low-cost manufacturing after China. Thailand has strong automotive, electronics, food, and chemicals industries, while Malaysia has strong chemical, machinery, and rubber processing industries. This is borne out in the relative prosperity as Malaysia and Thailand are by far the richest of the group and their labor costs are almost the highest in that five country group. They are competitors to China, and simply can't compete with Bangladesh in labor cost. Period.

India: India has many challenges. In order to have a flourishing manufacturing base, workers need to be able to at least read and write to operate machinery. India scores low on general skills attainment, ranking 105th in the world according to the UN’s Human Capital Index 2016, lower than any other nation in this five nation group. In fact India ranks below Bangladesh in Human Capital Index and will continue to do so because of its size and the terrible education and health conditions in its lowest developed States like Bihar, Madhya Pradesh and Uttar Pradesh, which will be sources of its low cost labor. India’s infrastructure is woeful, in particular transport and energy supply, where it ranks lower than most other emerging economies. Government inefficiency is also a major stumbling block – delays in land acquisition and environmental clearances have stalled more than 270 projects across the country. To top it off, Indian wages are double that of Bangladesh. No competition for low wage manufacturing.

Vietnam: Vietnam wages are half that of China but still about double that of Bangladesh. Vietnam has had a very stable political environment but China will be reticent to encourage investment heavily in Vietnam because of strategic reasons, they are ancient rivals. Vietnam's recent defence purchases to counter China and overtures to form defense entente with India (especially Indian Navy) will not help things.

Indonesia: The problem for Indonesia is the state’s capacity to implement industrial strategy; the state is highly decentralized and there are huge infrastructure issues. You don’t have these challenges in Bangladesh or Vietnam which are smaller and densely populated countries. Indonesia’s population of over 255 million represents a large potential consumer market but at the end of the day we are talking about export led growth and Chinese investment which the Chinese govt. is and will be reluctant to encourage in Indonesia because of potential future political rivalries. There will be a lot of empty talk but action will be few and far between unfortunately. Again to top it off, Indonesian wages are triple that of Bangladesh. No competition.

 

[Nilgiri]

Sit back and learn my friend now.

Botswana is a tiny country of only around 2 million people. It has massive mineral reserves for it's population.
Mineral exports are around 4 billion US dollars which is 2,000 US dollars per person.

Now BD would need hundreds of billions of dollars in exports of say gas every year to be in the same position as Botswana.

There are plenty of countries that have massively larger amounts of larger natural resource wealth / capita than Botswana.

You clearly have not studied anything regarding why Botswana bucked the natural resource Africa (and world at large) growth trend. It has a lot to do with their institutional capacity and development and much less to do with the natural wealth. Prime example is how gabon, sierra leone, equatorial guinea, DRC and several others squandered it away....and continue to do a terrible job harnessing it for long term sustainable growth through institutional development.

BD also has terrible institutional development....worse than many poorer African countries....so yeah I don't hold much long term hope on that front. So I dont need to sit back and learn anything from someone who is pretty much economically illiterate.

 

[Bilal9]

There are plenty of countries that have massively larger amounts of larger natural resource wealth / capita than Botswana.

You clearly have not studied anything regarding why Botswana bucked the natural resource Africa (and world at large) growth trend. It has a lot to do with their institutional capacity and development and much less to do with the natural wealth. Prime example is how gabon, sierra leone, equatorial guinea, DRC and several others squandered it away....and continue to do a terrible job harnessing it for long term sustainable growth through institutional development.

BD also has terrible institutional development....worse than many poorer African countries....so yeah I don't hold much long term hope on that front. So I dont need to sit back and learn anything from someone who is pretty much economically illiterate.

Reported because of flaming and name calling.

Guys from Bangladesh!
Meaning actual Bangladeshi people, not false flaggers!

Have some shame and stop tagging this guy.

Everything he posts is anti-Bangladeshi. I am amazed how someone like this can keep disrupting the peace in our corner of PDF, flame every thread with abandon all the time and keep coming back! He is a nuisance!

@waz and @WAJsal bhais your action is kindly needed after Eid.

 

[wiseone2]

Reported because of flaming and name calling.

Guys from Bangladesh!
Meaning actual Bangladeshi people, not false flaggers!

Have some shame and stop tagging this guy.

Everything he posts is anti-Bangladeshi. I am amazed how someone like this can keep disrupting the peace in our corner of PDF, flame every thread with abandon all the time and keep coming back! He is a nuisance!

@waz and @WAJsal bhais your action is kindly needed after Eid.

I cannot comment on all of his posts. But his previous post was accurate. Sometimes the truth hurts

Thanks for your thoughts Loki Bhai, you made some points worth observing and they need further discussion.



1971 IMHO helped India as much as it did us. For starters, it made them rest easy and relieved them of a thorn on their side at the time so they could fight a single front war instead of a two front one. It also gained them a huge regional market worth about seven billion dollars a year formally, and as much informally through smuggling totalling some USD 12 to 14 billion a year (I'd say more lucrative than Nepal or Sri Lanka) than they had previously, with no price paid economically through imports.

We only have to blame Bhutto and gang on what they did in 1971 for selfish reasons, yet they had no vision that Pakistan United, could rival India in manufacturing prowess as it does in defence today. Inclusive development is not a part of our history in the subcontinent (we possess garbage for brains instead of being visionary, we always want to dominate supposedly 'meek' populations) and we will see this further manifest itself in India's north/south egotistical cultural divide. Time will tell.

I don't see India's Chanakya south block diplomacy to dominate us reducing anytime soon, a placating foreign policy will keep India at bay at least until we gain strength economically and properly equip to defend ourselves. Everyone likes to dominate a sitting duck, it's the nature of garbage human beings in South Asia. As long as Indians don't think we're a present or emerging threat (I don't think we will be in that space anytime soon) then they are fine with us and will leave us alone hopefully. Disrupting our trade/manufacturing activity or fomenting unrest in Bangladesh will create an unstable quarter on their eastern flank to spell trouble in their own country and they know that very well.



Lobbying is the need of the hour. Pakistanis and Indians all have strong trade lobbies in Washington, and our lobbying activity is not as strong as theirs. This is a shame and a crying need of the hour. Reestablishing GSP for US markets and establishing new markets in South America is necessary immediately.

Coming back closer to the subject of the thread- Bangladesh is a better destination than any country to replace China's Low-cost manufacturing role which played a big part in making China the second largest economy in the world by 2010, compared to the ninth largest in 1980.

Now China is rapidly moving into medium to high-tech manufacturing as its labor costs have risen. Manufacturing goods in China is now only 4 percent cheaper than in the United States, in large part because yearly average manufacturing wages in China have increased by 80 percent since 2010. It is in response to this that China, backed by billions of dollars in investment from its government, has vigorously moved into higher value manufacturing.

True we are setting up a hundred SEZS and are gearing up rapidly to produce labor-intensive commodity-type products like apparel, shoes, toys, textiles and basic consumer electronics and home electric products. Our two decades of exporting textile and footwear products have put us ahead of a lot of competitors like Malaysia, India, Thailand, Indonesia, and Vietnam, and here's why, in addition to being the lowest cost competitor by far (our labor cost is less than half of India's, and India's labor cost is the lowest in the group).

Thailand and Malaysia : Thailand and Malaysia are more focused on high- and medium-tech manufacturing rather than being the next centers of low-cost manufacturing after China. Thailand has strong automotive, electronics, food, and chemicals industries, while Malaysia has strong chemical, machinery, and rubber processing industries. This is borne out in the relative prosperity as Malaysia and Thailand are by far the richest of the group and their labor costs are almost the highest in that five country group. They are competitors to China, and simply can't compete with Bangladesh in labor cost. Period.

India: India has many challenges. In order to have a flourishing manufacturing base, workers need to be able to at least read and write to operate machinery. India scores low on general skills attainment, ranking 105th in the world according to the UN’s Human Capital Index 2016, lower than any other nation in this five nation group. In fact India ranks below Bangladesh in Human Capital Index and will continue to do so because of its size and the terrible education and health conditions in its lowest developed States like Bihar, Madhya Pradesh and Uttar Pradesh, which will be sources of its low cost labor. India’s infrastructure is woeful, in particular transport and energy supply, where it ranks lower than most other emerging economies. Government inefficiency is also a major stumbling block – delays in land acquisition and environmental clearances have stalled more than 270 projects across the country. To top it off, Indian wages are double that of Bangladesh. No competition for low wage manufacturing.

Vietnam: Vietnam wages are half that of China but still about double that of Bangladesh. Vietnam has had a very stable political environment but China will be reticent to encourage investment heavily in Vietnam because of strategic reasons, they are ancient rivals. Vietnam's recent defence purchases to counter China and overtures to form defense entente with India (especially Indian Navy) will not help things.

Indonesia: The problem for Indonesia is the state’s capacity to implement industrial strategy; the state is highly decentralized and there are huge infrastructure issues. You don’t have these challenges in Bangladesh or Vietnam which are smaller and densely populated countries. Indonesia’s population of over 255 million represents a large potential consumer market but at the end of the day we are talking about export led growth and Chinese investment which the Chinese govt. is and will be reluctant to encourage in Indonesia because of potential future political rivalries. There will be a lot of empty talk but action will be few and far between unfortunately. Again to top it off, Indonesian wages are triple that of Bangladesh. No competition.

Why are Indian workers more poorly educated than Bangladeshi workers ?

There is no statistical difference in the UN’s Human Capital Index 2016
Bangladesh 57.84 104 77.88 87 58.16 99 47.21 122 57.58 98 46.92 92
India 57.73 105 84.91 62 56.46 106 48.11 119 46.48 120 33.74 119

Wages are less relevant as things get automated

 

[Nilgiri]

Why are Indian workers more poorly educated than Bangladeshi workers ?

There is no statistical difference in the UN’s Human Capital Index 2016
Bangladesh 57.84 104 77.88 87 58.16 99 47.21 122 57.58 98 46.92 92
India 57.73 105 84.91 62 56.46 106 48.11 119 46.48 120 33.74 119

How the HCI comes out depends really on the weighting of the components (of course he won't ask the Chinese members in this forum how they feel about Cuba being ranked twice as higher than them...but the actual realised performance being way different....for very much the same reason - really bad data reporting/manipulation). Its the one index that guy clings to, forgetting that output per worker (productivity) is double in India than Bangladesh (and growing faster):

http://www.ilo.org/ilostat/faces/or...afrWindowMode=0&_adf.ctrl-state=65sbvonmr_183

Not to mention the tons of other more basic realities this poor fellow ignores completely:

https://defence.pk/pdf/threads/whats-holding-back-bangladesh.474841/#post-9149084

He is after all the one that was projecting billions of dollars of exports by Walton by this year....but in reality there isn't even a decent wiki page about them.

Anyways he can whine and complain to the mods (for absolutely no reason) like he did last time:

https://defence.pk/pdf/threads/bang...ays-labour-rights-report.503017/#post-9598247

The result will be the same here too.

Calling someone economically illiterate apparently is against the rules now.

 

[Nike]

Thanks for your thoughts Loki Bhai, you made some points worth observing and they need further discussion.



1971 IMHO helped India as much as it did us. For starters, it made them rest easy and relieved them of a thorn on their side at the time so they could fight a single front war instead of a two front one. It also gained them a huge regional market worth about seven billion dollars a year formally, and as much informally through smuggling totalling some USD 12 to 14 billion a year (I'd say more lucrative than Nepal or Sri Lanka) than they had previously, with no price paid economically through imports.

We only have to blame Bhutto and gang on what they did in 1971 for selfish reasons, yet they had no vision that Pakistan United, could rival India in manufacturing prowess as it does in defence today. Inclusive development is not a part of our history in the subcontinent (we possess garbage for brains instead of being visionary, we always want to dominate supposedly 'meek' populations) and we will see this further manifest itself in India's north/south egotistical cultural divide. Time will tell.

I don't see India's Chanakya south block diplomacy to dominate us reducing anytime soon, a placating foreign policy will keep India at bay at least until we gain strength economically and properly equip to defend ourselves. Everyone likes to dominate a sitting duck, it's the nature of garbage human beings in South Asia. As long as Indians don't think we're a present or emerging threat (I don't think we will be in that space anytime soon) then they are fine with us and will leave us alone hopefully. Disrupting our trade/manufacturing activity or fomenting unrest in Bangladesh will create an unstable quarter on their eastern flank to spell trouble in their own country and they know that very well.



Lobbying is the need of the hour. Pakistanis and Indians all have strong trade lobbies in Washington, and our lobbying activity is not as strong as theirs. This is a shame and a crying need of the hour. Reestablishing GSP for US markets and establishing new markets in South America is necessary immediately.

Coming back closer to the subject of the thread- Bangladesh is a better destination than any country to replace China's Low-cost manufacturing role which played a big part in making China the second largest economy in the world by 2010, compared to the ninth largest in 1980.

Now China is rapidly moving into medium to high-tech manufacturing as its labor costs have risen. Manufacturing goods in China is now only 4 percent cheaper than in the United States, in large part because yearly average manufacturing wages in China have increased by 80 percent since 2010. It is in response to this that China, backed by billions of dollars in investment from its government, has vigorously moved into higher value manufacturing.

True we are setting up a hundred SEZS and are gearing up rapidly to produce labor-intensive commodity-type products like apparel, shoes, toys, textiles and basic consumer electronics and home electric products. Our two decades of exporting textile and footwear products have put us ahead of a lot of competitors like Malaysia, India, Thailand, Indonesia, and Vietnam, and here's why, in addition to being the lowest cost competitor by far (our labor cost is less than half of India's, and India's labor cost is the lowest in the group).

Thailand and Malaysia : Thailand and Malaysia are more focused on high- and medium-tech manufacturing rather than being the next centers of low-cost manufacturing after China. Thailand has strong automotive, electronics, food, and chemicals industries, while Malaysia has strong chemical, machinery, and rubber processing industries. This is borne out in the relative prosperity as Malaysia and Thailand are by far the richest of the group and their labor costs are almost the highest in that five country group. They are competitors to China, and simply can't compete with Bangladesh in labor cost. Period.

India: India has many challenges. In order to have a flourishing manufacturing base, workers need to be able to at least read and write to operate machinery. India scores low on general skills attainment, ranking 105th in the world according to the UN’s Human Capital Index 2016, lower than any other nation in this five nation group. In fact India ranks below Bangladesh in Human Capital Index and will continue to do so because of its size and the terrible education and health conditions in its lowest developed States like Bihar, Madhya Pradesh and Uttar Pradesh, which will be sources of its low cost labor. India’s infrastructure is woeful, in particular transport and energy supply, where it ranks lower than most other emerging economies. Government inefficiency is also a major stumbling block – delays in land acquisition and environmental clearances have stalled more than 270 projects across the country. To top it off, Indian wages are double that of Bangladesh. No competition for low wage manufacturing.

Vietnam: Vietnam wages are half that of China but still about double that of Bangladesh. Vietnam has had a very stable political environment but China will be reticent to encourage investment heavily in Vietnam because of strategic reasons, they are ancient rivals. Vietnam's recent defence purchases to counter China and overtures to form defense entente with India (especially Indian Navy) will not help things.

Indonesia: The problem for Indonesia is the state’s capacity to implement industrial strategy; the state is highly decentralized and there are huge infrastructure issues. You don’t have these challenges in Bangladesh or Vietnam which are smaller and densely populated countries. Indonesia’s population of over 255 million represents a large potential consumer market but at the end of the day we are talking about export led growth and Chinese investment which the Chinese govt. is and will be reluctant to encourage in Indonesia because of potential future political rivalries. There will be a lot of empty talk but action will be few and far between unfortunately. Again to top it off, Indonesian wages are triple that of Bangladesh. No competition.

very big LOL and hilarious jokes indeed.


low cost production factors is not only depends on low wage for the workers, dont you think why China, Japan and South Korea had more investment every year in Indonesia, Vietnam compared to Bangladesh. Its all down to who can bring more profit for the investor, so other factor contribute greatly like efficiency in beaurocracy, corruption perception index, the availability of raw materials, logistic and infrastructure performance, manufacturing output (production efficiency), HDI, and other factor.

for infrastructure wise, Indonesia though is being an Islands Nation had a much better performance compared to BD


http://lpi.worldbank.org/international/global?sort=asc&order=Infrastructure

 

[Nike]

How the HCI comes out depends really on the weighting of the components (of course he won't ask the Chinese members in this forum how they feel about Cuba being ranked twice as higher than them...but the actual realised performance being way different....for very much the same reason - really bad data reporting/manipulation). Its the one index that guy clings to, forgetting that output per worker (productivity) is double in India than Bangladesh (and growing faster):

http://www.ilo.org/ilostat/faces/oracle/webcenter/portalapp/pagehierarchy/Page3.jspx?MBI_ID=49&_afrLoop=1648247701269695&_afrWindowMode=0&_afrWindowId=65sbvonmr_146#!@@?_afrWindowId=65sbvonmr_146&_afrLoop=1648247701269695&MBI_ID=49&_afrWindowMode=0&_adf.ctrl-state=65sbvonmr_183

Not to mention the tons of other more basic realities this poor fellow ignores completely:

https://defence.pk/pdf/threads/whats-holding-back-bangladesh.474841/#post-9149084

He is after all the one that was projecting billions of dollars of exports by Walton by this year....but in reality there isn't even a decent wiki page about them.

Anyways he can whine and complain to the mods (for absolutely no reason) like he did last time:

https://defence.pk/pdf/threads/bang...ays-labour-rights-report.503017/#post-9598247

The result will be the same here too.

Calling someone economically illiterate apparently is against the rules now.

he is much talking but lacking support evidence and actual data. Not mean to demean Bangladesh, but the wishful thinking of him on how BD to topped many ASEAN countries to attract real investment from China is a nice joke indeed even when we are talking about future tense. The real example is how ever bad politically Vietnam and China can be, but the actual realization of Chinese investment (including Hongkong SAR and Makau) is still much larger in Vietnam than in Bd by large margin. Not to mention other much friendlier ASEAN countries like Malaysia, Thailand and Indonesia.

Although ASEAN economic growth is not as large as Bd, but the prospect of joint market, acess into infrastructure, strategic geoposition, quality of manpower of most ASEAN countries (especially the big five) is much better than BD by large margin still being considered as attractive and desirable.

 

[UKBengali]

There are plenty of countries that have massively larger amounts of larger natural resource wealth / capita than Botswana.

You clearly have not studied anything regarding why Botswana bucked the natural resource Africa (and world at large) growth trend. It has a lot to do with their institutional capacity and development and much less to do with the natural wealth. Prime example is how gabon, sierra leone, equatorial guinea, DRC and several others squandered it away....and continue to do a terrible job harnessing it for long term sustainable growth through institutional development.

BD also has terrible institutional development....worse than many poorer African countries....so yeah I don't hold much long term hope on that front. So I dont need to sit back and learn anything from someone who is pretty much economically illiterate.

@Bilal9 : It is ok as this guy is not the most clued up here.

So what that Botswana is run better than these other example countries?
End of the day Botswana has a massive advantage in that it is a unitary state where there is a clear ethnic majority.
I would hazard a guess that these other countries are multi-ethnic states where there is no clear dominant group and hence they are prone to instablity and civil wars. Reminds me of a massive and dirt poor multi-ethnic state that exists in S Asia after 70 years of independence.

We can guess what a unitary BD would have done with natural resources as it has one(gas) and that has mainly been used for the benefit of BD people rather than going into the pockets of politicians and squandered away.

 

[Bilal9]

he is much talking but lacking support evidence and actual data. Not mean to demean Bangladesh, but the wishful thinking of him on how BD to topped many ASEAN countries to attract real investment from China is a nice joke indeed even when we are talking about future tense. The real example is how ever bad politically Vietnam and China can be, but the actual realization of Chinese investment (including Hongkong SAR and Makau) is still much larger in Vietnam than in Bd by large margin. Not to mention other much friendlier ASEAN countries like Malaysia, Thailand and Indonesia.

Although ASEAN economic growth is not as large as Bd, but the prospect of joint market, acess into infrastructure, strategic geoposition, quality of manpower of most ASEAN countries (especially the big five) is much better than BD by large margin still being considered as attractive and desirable.

You are the one who is denying the elephant in the room.

I don't mean to demean Indonesia either, but I doubt you have ever worked at a manufacturing company or much less owned one, no offense. Otherwise you wouldn't even come back with the rather weak logic you presented.

In the business of making low cost products, labor cost is everything. Please let that soak in for a couple of minutes.....

Buyers move orders from one country to another for 4 cents a shirt.

Now go back, look at the labor cost in each country (including yours), then come present me something believable.

None of the five countries I mentioned can compete with the likes of middle or higher labor cost producers like Korea, Taiwan, Eastern Europe or now, China.

Indonesia is not the Netherlands. In fact HDI indicators in Indonesia is worse than in Bangladesh.

Minimum wage per month in Bangladesh is Tk.5300 or 65.732 US Dollar.

Minimum wage per month in Indonesia is IDR.3,355,750.00 or 252.141659 US Dollar or roughly four times the wage rate of Bangladesh.

http://www.wageindicator.org/main/salary/minimum-wage/indonesia

Let me know how this adds up.

And about the 'Quality of manpower' story you put up about workers in other countries being smarter or more skilled than in Bangladesh, that is really racist and offensive.

Bangladeshi girls can make anything Indonesian girls can.....Bangladesh is the second largest garments exporter and fourth largest denim exporter in the world.

I cannot comment on all of his posts. But his previous post was accurate. Sometimes the truth hurts

Why are Indian workers more poorly educated than Bangladeshi workers ?

There is no statistical difference in the UN’s Human Capital Index 2016
Bangladesh 57.84 104 77.88 87 58.16 99 47.21 122 57.58 98 46.92 92
India 57.73 105 84.91 62 56.46 106 48.11 119 46.48 120 33.74 119

Wages are less relevant as things get automated

You are defending an inveterate flamer of all Bangladeshi threads, irrespective of merit. If you support him just because he happens to claim that he's Indian (or worse, because he flames us), I have nothing to say. He has been banned multiple times for his disrespectful behavior, and people like that have very little respect in my book, for that reason alone. If you come in here and argue with respect, I will return it in kind. His behavior, not so much. He has a lot of hard lessons to learn in life....

On topic, the qualitative difference between low cost labor in Bangladesh and India may not be that pronounced. However our labor cost is still HALF of yours. That alone speaks volumes about where Chinese (as well as Taiwanese and Korean) sunset industry low wage jobs have headed for the last two decades and will be heading. However other than low wage manufacturing, we don't have a lot common with India in manufacturing scenario. India has a lot of higher value addition manufacturing such as automobiles that we don't want to get into yet. We need to give enough jobs to the millions of lower class people, whom we actually care about.

Propaganda in consulting firms aside, Chinese low wage jobs will be going to places like Bangladesh first, given that buyers and Walmart customers obviously care about the cost of the final product. Low wage and low value addition jobs will remain Bangladesh' Forte for the time being, which suits us just dandy, Thank You.

Of course we have middle-class IT and pharmaceutical knowledge jobs too, which are growing faster than a lot of other countries in Asia.

And re: automation, I'm well read on this and can tell you that automation cannot replace people in low wage jobs like making, shoes, apparel, toys, kitchen items, home appliances and electronics as well as small electrics like fans, irons, blenders, toasters, coffee makers etc.

 

[lastone]

"The Americans do not happen to like them for some reason. "
Because BD is a reminder of a military defeat for them.
Also optics , BD comes across as a dirt poor country to them.
Road ahead for BD is ..
Maintain peace at home and neighbours.
Control population.
Grab any level jobs .
You guys are doing ok , no need to beat yourselves up.
Just 1 query , what are the sales of samsung in BD at the moment ?
If new facilities replace the imported samsung goods , then its win win as locals get jobs.
If they take mkt share from domestic companies , then limited success. Though in the future samsung might use BD as a export hub which generates good jobs.

 

[Bilal9]

"The Americans do not happen to like them for some reason. "
Because BD is a reminder of a military defeat for them.
Also optics , BD comes across as a dirt poor country to them.
Road ahead for BD is ..
Maintain peace at home and neighbours.
Control population.
Grab any level jobs .
You guys are doing ok , no need to beat yourselves up.
Just 1 query , what are the sales of samsung in BD at the moment ?
If new facilities replace the imported samsung goods , then its win win as locals get jobs.
If they take mkt share from domestic companies , then limited success. Though in the future samsung might use BD as a export hub which generates good jobs.

Done with your self congratulatory rant about your country?

I see no point in telling you about reality.

Just know that we have exceeded India in HDI indicators a decade ago, including many sanitary ones ☺.

We don't have to control our population, control yours please.

Our fertility rate is lower as well as maternal health indicators are higher than yours.

Read up something other than Sanghi propaganda please.