PRAN-RFL Group, one of the largest food and nutrition producers of the country is investing 10 million US dollar in a bicycle assembly plant near Dhaka which is primarily focused on export to the European Union markets. Production is to start next April.
PRAN-RFL Group is the Bangladeshi food-products corporation that is making an entry in the bicycle sector. Of course the new Generalised Scheme of Preferences (GSP) which went into force per January 1, 2014 and runs up to December 31, 2016, is the driving force behind the company’s decision to start the bike factory.
The EU trade rules allow Bangladesh (and Cambodia) to export bicycles, parts & accessories to the EU’s 28 member states without the regular 14% import duty on complete bicycles and 4.7% duty on imported parts and accessories. Bangladesh is already for some years benefitting from these trade incentives that boosted the country’s bicycle and bike products export to the EU. In 2012 Bangladesh exported 472,000 bikes to the EU making it Europe’s 5th biggest bike supplying country.
The PRAN-RFL Group’s 2012 revenues stood at US$ 450 million. “The bicycle project involves one export oriented assembly facility dedicated to the EU markets. While another assembly facility would manufacture bicycles for the domestic market,” said Ahsan Khan Chowdhury, Deputy Managing Director, PRAN-RFL Group.
‘Good prospects to grow’
He furthered, “Bicycles as an industry has good prospects to grow both at home and abroad. We aim to produce variety of bikes ranging from kids bikes, BMX, free style, MTB, road & trekking bikes over the years. Our focus is on offering quality products at reasonable prices.
The plant would fully commence production from April 2014 for the domestic market. While the export plant dedicated to the EU market would likely to start functioning two months later in June 2014,” said Khan.