Cost of doing business in Bangladesh

[Golam Kibria]

If a entrepreneur invest or start his/her business, he/she will face the costs for doing their business in Bangladesh.

Human Resources

Bangladesh gains its competitive edge mainly from its low labor costs of semi-skilled workers. The country has a adequate pool of semi-skilled as well as unskilled workers who are willing to work at very competitive rates, thus enabling Bangladesh to penetrate deep into the hearts of the international markets, with comparative and competitive cost advantages.

The government supports the principle of fair wages to the workers linked to increased levels of production. Wages may be fixed through collective bargaining processes. In case of inadequacy of the collective bargaining procedure, wages can be set by the Minimum Wages Board. The Minimum Wages Board strives to ensure a balanced view of both the interests of the management and the workers. The following examples indicate the average monthly basic wages and fringe benefits in US$ per worker in a private sector organization. In the final analysis, wages and others compensations are market set.
Wage (monthly in US$)
   
Wage (monthly in US$)    Unskilled     Semi-skilled       Skilled
Basic wages                       30                    50                 70
Fringe benefits                   20                    25                 30
Total                                   50                    75                100
 

[Golam Kibria]

Utilities

Electricity

Generation, transmission and distribution of electricity in Bangladesh is the responsibility of the Bangladesh Power Development Board (BPDB). In Bangladesh, electric power is generated in hydro, steam, gas-turbine and diesel power plants, All the generating stations are interconnected through a national grid. The Dhaka Electric Supply Authority (DESA) started operation to maintain uninterrupted supply of electricity in the capital city. The industrial consumption rate of electricity varies from Tk.5.15 to Tk. 8.87 per kW depending on the size of the industries, load capacity and peak/off peak hour consumption.

Key statistics
Total installed capacity    6658 MW    February, 2011
Maximum generation    4699 MW    February, 2011
Source: Bangladesh Economic Review 2011 (Bangla Version)


Gas

Natural gas supply is available in major industrial areas of Dhaka and Chittagong Divisions. Gas tariff for industrial consumption is Tk. 165.91 (US$ 2.39) per MCF including supplementary duty and VAT.

Water and sewerage

Water is supplied by the Water Supply and Sewerage Authority (WASA) in metropolitan areas of Dhaka and Chittagong. For other municipal areas the local municipalities are responsible for the task

Telecommunications

Comprehensive telecommunications services such as fully automatic telex, fax, e-mail, internet, telephone including international direct dialing are available with important international carriers. The total number of mobile phone active subscribers has reached 56.36 m at the end of April 2010.