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Chapter 5 Selection and Implementation of Pilot Projects Chapter 5 Selection and Implementation of Pilot Projects Chapter 5 Selection and Implementation of Pilot Projects 5.1 Pilot Project for Jute Products Sub-sector Chapter 5 Selection and Implementation of Pilot Projects As discussed in Chapter 4, jute products and computer software were selected as the most potential sub-sectors. The current Study conducted the Pilot Projects for those two sub-sectors from October 2007 to August 2008 (from the Third Field Survey to the Sixth Field Survey). This chapter describes planning policy and basic design of the Pilot Projects, as well as conclusion, recommendations and lessons obtained by implementing the Pilot Projects. Note that details of the Pilot Projects are reported in the “Pilot Project Completion Report,” a supplementary volume of the current Final Report. 5.1 Pilot Project for Jute Products Sub-sector This section summarizes planning policy and basic design of the Pilot Project in jute products sub-sector, as well as conclusion, recommendation and lessons obtained by implementing it. 5.1.1 presents the selection process of the Pilot Project, followed by 5.1.2 that discusses basic design of it. Then, 5.1.3 summarizes conclusion, recommendations and lessons obtained through implementation and evaluation exercise of the Pilot Project in jute products sub-sector. 5.1.1 Pilot Project Selection Process First of all, a long list of candidate Pilot Projects was prepared and screened by applying two selection criteria. Then, the JICA Study Team presented a final plan at the workshop on June 24, 2007 where the industry stakeholders gathered. The participants accepted the final plan. 5.1.1.1 Long List of Pilot Projects The JICA Study Team had explained five constraints, which hampered export growth of the jute products sub-sector at the previous workshop to select two priority sub-sectors (refer to Chapter 4). The JICA Study Team prepared a long list of the Pilot Project candidates with reference to the five constraints against export growth of jute products. Thus, the Pilot Project proposals were developed from the viewpoint of eliminating or reducing factors impeding export growth. The five constraints are listed below. 5 - 1 Chapter 5 Selection and Implementation of Pilot Projects 5.1 Pilot Project for Jute Products Sub-sector Table 5.1-1 Constraints against Export Growth (Jute Products) Constraint 1 State-own jute mills are inefficient and half of them is now closed. There is limitation of cultivation area of raw jute due to competition with rice Constraint 2 production. Production facilities are outdated and production management technology is Constraint 3 low. Progress has not been really made in developing new usage and application of Constraint 4 jute products. Jute is in harsh competition with synthetic fibers whose product development Constraint 5 progress is way ahead of jute. The JICA Study Team prepared a long list of Pilot Project candidates for each of the five constraints. The completed long list contains a total of ten candidate projects as follows. LONG-LIST PROJECTS FOR JUTE PRODUCTS SUB-SETOR (Numbered as LL-J+Number) Constraint 1: State-own jute mills are inefficient and half of them is now closed. LL-J1: Productivity improvement of state-own jute mills LL-J2: Study and recommendation on the management system of state-own jute mills Constraint 2: There is limitation of cultivation area of raw jute due to competition with rice production. LL-J3: Development of high yield variety of jute Constraint 3: Production facilities are outdated and production management technology is low. LL-J4: Introduction of long-term credit facilities for the jute mills LL-J5: Introduction of production management skills for productivity improvement LL-J6: Classroom training of top managements of jute mills Constraint 4: Progress has not been really made in developing new usage and application of jute products. LL-J7: Competition and seminars of new design and usage of jute products in Bangladesh and abroad LL-J8: Establishment or strengthening of R&D institutes for new usage and application of jute products 5 - 2 Chapter 5 Selection and Implementation of Pilot Projects 5.1 Pilot Project for Jute Products Sub-sector LL-J9: Collection and dissemination of information about new products for jute mills and brokers Constraint 5: Jute is in harsh competition with synthetic fibers whose product development progress is way ahead of jute. LL-J10: Advertisement of usage of jute as environment friendly natural fibers 5.1.1.2 First Screening of the Long List The JICA Study Team screened the ten projects in the long list by applying the following two criteria. As a result, the following projects were removed from the long list on account of their irrelevance to the present Study. Criterion 1: On-going programs/projects organized and commenced by other organizations LL-J3: Development of high yield variety of jute - Bangladesh Jute Research Institute (BJRI) - Bangladesh Agriculture Development Corporation (BADC) LL-J7: Competition and seminars of new design and usage of jute products in Bangladesh and abroad - Jute Diversification Promotion Centre (JDPC) - Export Promotion Bureau (EPB) - Japan External Trade Organization (JETRO) LL-J8: Establishment or strengthening of R&D institutes for new usage and application of jute products - Bangladesh Jute Research Institute (BJRI) LL-J9: Collection and dissemination of information about new products for jute mills and brokers - Jute Diversification Promotion Centre (JDPC) LL-J10: Advertisement of usage of jute as environment friendly natural fibers - Unnecessary to specifically take up this issue as a project because media, public and private organizations often announce the fact. Criterion 2: Inappropriate projects as a subject of JICA’s Study LL-J4: Introduction of long-term credit facilities for the jute mills - The JICA Study Team has no access to financial resources to meet the requirements even if the Team is able to illustrate a financial credit scheme about LL-J4. 5 - 3 Chapter 5 Selection and Implementation of Pilot Projects 5.1 Pilot Project for Jute Products Sub-sector LL-J1: Productivity improvement of state-own jute mills - Although the JICA Study Team can contribute to the projectsLL-J1, interests of the Ministry of Textile and Jute and Bangladesh Jute Mills Corporation (BJMC) are unclear. Since the BJMC is the only corporation that manages all state-own mills, each mill cannot make decision by itself even in process improvement. LL-J2: Study and recommendation on the management system of state-own jute mills - Although the JICA Study Team can contribute to the project LL-J2, there may be big constraints for implementation of proposed recommendations due to the state-own nature of the targets. 5.1.1.3 Short List and Final Selection LL-J5: Introduction of production management skills for productivity improvement LL-J6: Classroom training of top managements of jute mills - LL-J5 and LL-J6 are the final candidates for a Pilot Project, both of which aim at modernization of existing jute mills, in terms of improvement of productivity of factories in LL-J5 and improvement in management skills in LL-J6. LL-J5 is a direct approach to inefficient production management and Japanese improvement methods like KAIZEN and 5S are not popular in the country. Therefore, LL-J5 was presented as the final proposal for the Pilot Project at the workshop under the following project title, to which the participants in the workshop gave consents. “Production Processes Improvement (KAIZEN) Project ” 5.1.2 Conceptual Design of Pilot Project for Jute Products Sub-sector For the Pilot Project proposal selected according to the preceding section, “LL-J5 Introduction of production management skills for productivity improvement,” conceptual design of the following Pilot Project was made in consideration of the budget framework allowed for the Project in terms of finance and human resource. 5.1.2.1 Principles of Conceptual Design The selected Pilot Project aims to introduce the “KAIZEN (continuous improvement)” technique that has developed in Japan to Bangladesh. Its primary objective is to improve productivity of the jute mills that currently operate spinning and weaving processes. Basic principles of the Project selection and conceptual design are described below in terms of relevance to the Study’s objective, i.e., export diversification. 5 - 4 Chapter 5 Selection and Implementation of Pilot Projects 5.1 Pilot Project for Jute Products Sub-sector (1) Strengthening of the key export sub-sector As mentioned earlier, garment products account for 75% of the total value of the country’s exports, followed by frozen shrimps and raw jute and jute products, which hold 4 to 5% share each. Other export items account for a combined share of around 20%. For the interest of reducing the risk of depending heavily on garment exports, it is therefore important to boast exports of products that ranked near to the enormous garment sector. Although jute has been a traditional export item but was losing its ground, jute has now potential to grow in the international market thanks to its environment-friendly nature. Thus, the Pilot Project contributes to export diversification by expanding export values of jute products, which is one of the key export sub-sectors in Bangladesh. (2) Need for high quality yarns for diversification of jute products At present, jute products exported from Bangladesh are dominated by low value added products, such as traditional sacks, cords and ropes, and carpet backing cloth. To produce higher value added products (curtains, other materials for household goods and clothes that mix spun jute and other fabrics), it is imperative to be able to produce fine jute yarns of uniform thickness, without any knot to join broken fibers. At present, the industry produces jute yarns for low value added products due to outdated equipment and low levels of production and management technologies.
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