Only 13.1 per cent of small and medium enterprises (SMEs) surveyed across six non-RMG sectors are involved in exports, while none have used bonded warehouse facilities allowing duty-free raw material imports for export production, highlighting structural barriers limiting Bangladesh’s export diversification.
A study presented at a validation workshop on SME competitiveness on Sunday also found that only 1.87 per cent of firms were aware of the statutory regulatory order (SRO) linked to bonded warehouse facilities.
The survey, conducted by Business Initiative Leading Development (BUILD) among 107 SMEs in the home textile, footwear, light engineering, furniture, agro-processed food and plastic packaging sectors, identified complex customs procedures, high compliance costs, geographic restrictions, collateral-based financing and weak institutional support as key export barriers.
The study also found that 48.4 per cent of non-exporting SMEs would consider entering export markets if duty-free raw material access and simplified compliance systems were introduced, indicating significant untapped export potential outside the ready-made garment sector.
BUILD CEO Ferdaus Ara Begum said many SMEs remain excluded from export markets due to procedural complexity and limited access to policy support.
Entrepreneurs from the Kumarkhali home textile cluster sought lower import duties on raw cotton and export-oriented training, while footwear manufacturers from Bhairab called for workforce skill development and a common facility centre.
Representatives from agro-processed food and light engineering sectors cited high VAT, elevated lending rates, electricity shortages and compliance costs as major barriers to competitiveness.
Industries Ministry Joint Secretary Sultana Yusmin called for coordinated SME policy implementation alongside development of a comprehensive SME database and SME index.
Export Promotion Bureau Director General Baby Rani Karmakar said the agency supports SMEs and women entrepreneurs through training, visa assistance and participation in international trade fairs, including exceptional support for innovative firms without formal trade licences.
Bangladesh Bank Executive Director Hosne Ara Shikha said banks have been instructed to allocate 25 per cent of outstanding loans to cottage, micro, small and medium enterprises (CMSMEs), although SME lending accounted for only 18 per cent of total loans last year.
She said Bangladesh Bank offers CMSME refinancing at 7 per cent interest and 5 per cent for women entrepreneurs. Of the Tk679 billion refinancing allocation across sectors, 15 per cent has been earmarked for women entrepreneurs, although only 6.7 per cent of the target was achieved last year.
