Rural industries gasp

When this lockdown shut New Market or Banga Bazar in Dhaka, Fatema Akter in a Munshiganj village was in extreme stress as sales of her handcrafted textile goods also evaporated.

The numerous shops in those markets are the main outlets for her products.

"With sales of Tk5 lakh, I made a handsome profit even in 2020. But this year, I have already made a loss of Tk21,000 as I could not sell anything to the retailers in Dhaka," said Fatema, a skilled craft worker.

She said she used to get Tk800-Tk1,200 for crafting a saree and Tk400-Tk2,500 for stitching a nakshi kantha.

Lockdown has kept markets and shopping malls shut, putting a halt to supplies from the countryside, leaving micro and cottage entrepreneurs without work and income.

Demand for handicraft and cottage industry products has plummeted since the pandemic made inroads into the country in March last year. And a series of lockdowns has made it difficult for artisans to market whatever products they make in family workshops.

Fatema said her workshop has 65 workers, and all of them are in dire straits. More than a dozen women entrepreneurs in Munshiganj on the outskirts of the capital echoed Fatema about their financial troubles.

Many entrepreneurs in the district's Mollar Char, Khaleast and Sirajdikhan upazila have shuttered their businesses, while the pandemic-led crisis forced some others to switch to different professions.

Safia Khatun, president of a women entrepreneurs' platform, Mahila Kalyan Samity, said their product orders have evaporated because of Covid-19.

Safia said members of the platform usually produce block prints and batik fabrics, make bead jewellery and bamboo products.

Around 60 women – a number of them widows and physically challenged – work at Ekota Mahila Unnayan Samity in Munshiganj municipality.

"We came here to earn, but all of us are now in serious trouble as the demand for handicraft items and the market itself has crumbled," said Pakhi Begum of the Samity.

Aleya Ferdous, acting deputy director at the District Women Affairs Office, said they provided women entrepreneurs with low-cost loans and would continue all-out support in the future too.

Once the virus situation improves, Aleya said they would open a parlour and display centre to facilitate the sales of handicrafts and other items. Munshiganj Deputy Commissioner Kazi Nahid Rasul also said they would help the virus-hit women entrepreneurs.

Capital exhausted, now living on loans

A number of micro and cottage entrepreneurs in Bogura – the commercial hub in Northern Bangladesh – said they had already used up their capital to survive in the bleak pandemic period.

"We do not know exactly how many cottage industries there are in Bogura. But it is for sure that the entire industry in the district is in deep trouble owing to the pandemic-led lockdown. Some have been forced to close down businesses," said AKM Mahfuzur Rahman, deputy general manager of the Bangladesh Small and Cottage Industries Corporation (BSCIC).

Joynal Abedin of Brahmanbaria used to produce handcrafted bamboo products. He said he borrowed from relatives and friends.

"I have so far borrowed Tk50,000," said Joynal.

The family of Ratan Das of Brahmanbaria's Sarail upazila has made fishing nets for generations. With his wife and three sons as helpers, he used to earn Tk30,000-Tk40,000 a month.

"Now I cannot earn even Tk10,000 a month. I used up all my savings long ago. Now I am helpless, but I cannot reach out to anyone for help either," said Ratan.

In Faridpur, most of the 6,000 small and cottage enterprises are now closed. Entrepreneurs said they are struggling to stay afloat and that they might lose the battle if the pandemic lingers.

Loss of income, layoff – all too common now

Nusrat Jahan runs a fashion house in Bogura town. Her 19 employees would make clothes for the outlet at her family workshop.

"The current production is not even 10% of what it was in normal times. I had to lay off some of my workers owing to the slump in business," she said.

Khushi Begum and her husband work at a jewellery factory in Bogura. They set up an antique jewellery unit at home too. The five-member family had been doing fine until the pandemic hit the country last year.

Lockdown slowed down the raw material supply and the marketing of products, said the couple.

Artisans of Bogura's Dhunat and Lakshmipur's Kamalnagar upazila make fez caps that are exported to the Middle East. It takes 10-12 days to make a cap and an artisan gets Tk700-Tk1,000 for it.

"We have been getting few orders since last year. Our income has fallen," said Farhana, a cap maker in Lakshmipur.

"Since we are not mainstream workers, no one cares about us," she added.

Aleya Begum of Lakshmipur's Kamalnagar upazila said she used to earn Tk7,000-Tk8,000 per month by making shitalpati.

"But the demand is now low and the price has fallen drastically," she said.

Tahmina Akter Munni of Lakshmipur Sadar stitches nakshi kantha for Tk500-Tk5,000 per piece. Tahmina said her sales had plummeted too.

Trimmed food budget

Hadis Mia and his wife Rima Akter of Brahmanbaria Sadar upazila make handicrafts from bamboo and sell those to local wholesalers. Before the pandemic, the couple's monthly sales would be around Tk25,000 – enough for the family's monthly expenses and leave some for savings.

But those days have gone as Hadis Mia now struggles to manage to put three meals on the table.

"I borrowed Tk50,000 from an NGO, but I am unable to repay now. Interests keep adding up to the loan every month," he said.

Hadis said they used to have fish and meat every week but they had to switch to vegetables only after the business failure.

"During the lockdown, we could afford fish once or twice a month," he sounded upset. Other families with handicraft businesses in Hadis's neighbourhood also have similar stories.

Entrepreneurs want soft loans, incentives

With four employees, Faridpur's Khabaspur boutique shop owner Asma Sultana Bithi finds herself in serious trouble whenever a lockdown is imposed since she cannot open her fashion outlet.

Bithi said she is not trying for any loans. Rather, she sought government incentives for women and cottage enterprises to cushion the pandemic fallout.

Unlike Bithi, fashion entrepreneur Sathi Mahmud of Faridpur town said she was trying for a loan, which she believes would help the business turn around.

SM Kuddus Mollah of Faridpur's Nagarkanda upazila borrowed Tk5 lakh from the Bangladesh Small and Cottage Industry Corporation district office for his nursery. With sluggish sales, he, however, was worried about repayment.

Mohammad Golam Hafiz, deputy general manager of BSCIC Faridpur office, said they had distributed cheques worth Tk2 crore among 35 virus-hit entrepreneurs. Besides, they provided Tk40 lakh loans to micro and cottage entities from the BSCIC fund.

Stimulus support for cottage industries 

The Bangladesh Small and Cottage Industries Corporation (BSCIC) disbursed loans amounting to Tk50 crore to pandemic-hit small and cottage industries under the government-approved stimulus package.

The finance ministry authorised the BSCIC to disburse Tk100 crore. But for FY21, it got Tk50 crore and completed disbursals among 1,416 entrepreneurs, including 490 women ones, in Dhaka, Khulna, Chattogram, and Rajshahi at a 4% interest rate by 30 June this year. The highest number of recipients were from Rajshahi where 403 entrepreneurs took Tk12.90 crore in loans.

Besides, the BSCIC gave loans amounting to Tk70-80 crore from its own fund to entrepreneurs. It will disburse Tk50 crore more in the current fiscal year after it gets the fund from the finance ministry. 

BSCIC Chairman Mostaque Hasan told The Business Standard, "Small and cottage industries have plunged into deep trouble because of Covid-19. They are fighting for survival. And we are disbursing low-interest loans among them to help them recuperate from pandemic-induced losses."

They are also arranging online fairs so that small entrepreneurs can sell their products because many of them are facing a capital crunch but cannot sell their products in these trying times, he added.

"We are arranging a 15-day online fair in every district and getting a very good response. Some 63 fairs are now running online in different districts. The extent of such fairs will be extended in phases," he also said. 

Cottage, micro, small and medium enterprises account for 86% of the country's total industries. Of them, only 25,000 have government registration.  

According to a GIS-based online database for small, cottage and medium industries, the number of cottage industries across the country is 122,315. The number of people engaged in such small industrial units is 851,440, including 4.38 lakh women. 

The cottage industry is an industrial initiative dominated by family members, with an investment of Tk10 lakh and a maximum of 15 workers.

[Rafiqul Islam in Dhaka and TBS correspondents Mainuddin Suman in Munshiganj, Khorshed Alom in Bogura, Sana Ullah Sanu in Lakshmipur, Sanjib Das in Faridpur, and Azizul Shonchay in Brahmanbaria districts contributed to the report.]