SME Foundation did not include the steel furniture industry on the list of recipients of the government’s stimulus package for businesses impacted by Covid-19
Abdul Matin had been in the business of steel furniture for 30 years. The popularity of furniture made of wood, laminated board and plastic led to a gradual decline in the demand for steel furniture over the last few years. Things turned worse for Matin when his shop in the capital's Nakhalpara remained shut for five consecutive months last year amid the pandemic.
Unable to pay his shop's rent and his employees' salaries, or bear his familial expenses, Matin folded his business. At the time, he was also facing stacked-up dues to steel companies and installments against bank loans.
"The business was not good even before the novel coronavirus. Now, there are almost no customers," Matin said.
Another businessman, Jewel Ahmed, in Nababpur, Old Dhaka, also observed a sharp fall in his sales. Before the pandemic swept over the country, he could sell furniture worth Tk7 lakh-Tk8 lakh a month. The figure has dropped to Tk60,000-70,000.
"I have not sold a single item in the last week. I have made up my mind to sell the shop, but there is no buyer in the present circumstances," said Jewel, who has been in the sector for 20 years.
Matin and Jewel represent the majority of the steel furniture businessmen, who feel it is impossible to recover from the losses they have endured.
In Nababpur, Old Dhaka, there are about 30 shops that sell steel: almirahs, file cabinets, steel racks, showcases, tables, chairs, etc. They sell wholesale and retail.
"The industry has been hit hard by the pandemic. Most of the businessmen have bank loans, and sales plummeted by 60-70%," said Muhammad Anwar Hossain, president of the Multipurpose Cooperative Society of Steel Furniture on English Road.
Most of the shop owners are failing to pay their monthly rent and instalments for bank loans. Many are trying to sell their shops. Four to five shops have already been closed.
"We have not received a dime of the stimulus package allocated by the government for small industries," Anwar added.
The government, in April last year, announced a stimulus package of Tk72,750 crore to help businesses recover from financial losses inflicted by Covid-19. Of the amount, Tk20,000 crore was allocated for cottage, micro, small and medium enterprises. But, the Small and Medium Enterprises (SME) Foundation did not include the steel furniture industry on the list of cash recipients.
On the distribution of stimulus funds, Prof Anu Muhammad, of the economics department at Jahangirnagar University, said the government did not have updated information about all the industries of the country, which was why many industries like the steel furniture industry did not get any government support.
And those, who got money from the package, lobbied for that, he said.
"Before declaring the second round of stimulus packages, the government should prepare a list of damage suffered by the industrial sectors. Otherwise, many sectors will again remain out of coverage," Anu Muhammad said.
According to the English Road Steel Furniture Multipurpose Cooperative Society, the country has as many as 70,000-80,000 factories that manufacture steel furniture. There are around 500 factories in the capital alone. The total investment is about Tk10,000 crore, which is at risk because of the closure of most of the factories.
About 60% of the sector's 30 lakh workers lost their jobs.
At a steel furniture workshop in Mohammadpur in the capital, Mosarraf Hossain said six of his coworkers left their jobs because they were not paid. "I have been working here for 25 years. If I get a better job, I will leave too."
The cooperative society's General Secretary GM Omar Faruq said, "We pay a 7% tax to the government exchequer. We request the government to give us cash support from the declared stimulus packages and that the time for loan repayment be extended."
People should also be encouraged to buy steel furniture at a low cost, instead of wooden items that demand the destruction of forests.
SME Foundation's Managing Director Md Mafizur Rahman told The Business Standard, "We are trying to give stimulus funds to all small and medium enterprises. Since we do not have any contact with entrepreneurs or organisations linked with the furniture industry, we have not provided funds to them."
The government has already decided to deliver a second stimulus package of Tk300 crore. "If persons or organisations from the sector communicate with us following the due process, we will give them priority."