The first ceramic factory in Bangladesh (the then East Pakistan) was established by Tajama Ceramic Industries in the year 1962. The production capacity was limited and so was the company's impact on the market. In 1968, some quality porcelain tableware manufactured by People's Ceramic Industries Ltd. started to come to the market but the journey was stalled by the liberation war. The post-liberation years saw a dull performance by the existing companies until the mid 80s when with the coming of some new quality companies the sector was rejuvenated.

In the 90s, there were more entries and the sector attracted foreign investment. At the same time the process of product diversification began with the industry manufacturing different types of ceramic products such as Ceramic Sanitary Ware.

At present, there are about 10 companies manufacturing tableware, out of which Shinepukur Ceramics and Monno Ceramics enjoy huge brand popularity both in local and international markets. About 10 companies are manufacturing ceramic tiles and the leading companies are RAK Ceramics and China Bangla Ceramics. According to Bangladesh Ceramic Ware Manufacturers' Association (BCWMA), only two companies are manufacturing ceramic sanitary ware: Bangladesh Insulator & Sanitary Ware Factory Ltd. (BISF) and Dacca Ceramic & Sanitary Ware Ltd.

Almost all ceramic industries in Bangladesh are located mainly on the outskirts of Dhaka city. To ensure proper quality and retain goodwill all ceramic tableware producing units use high quality raw materials. Most of them are equipped with high quality modern machinery conforming to the latest technology and environmental standards. Besides, these companies have in-house laboratory facility, quality control and testing mechanism.

High quality raw materials are imported from such countries as Japan, Germany, New Zealand and India. There is no dearth of cheap but quality labour on the market. There are many local artisans who are experts in hand paint and traditional designs. At the same time many modern designs are used.

Thus the ceramic companies in Bangladesh are producing very high quality products appealing to both local and international consumers. Many of these companies export almost 80% of their products to many international markets. Shinepukur Ceramics exports 90% of its total Ceramic Tableware output. Tableware products such as dinner sets, breakfast sets, vases, and so on are now reaching more than 50 countries in the world including USA, UK, Italy, Spain, France, Australia and Sweden.

Competition

The major competitors of Bangladesh ceramic companies are mostly Asian countries: China, Japan, Indonesia, Malaysia, Sri Lanka and Thialand. The European countries like UK and Italy are mostly involved in trading of ceramic business -- that is, they buy products from Asian countries and sell them to different developed countries in the world. Currently, China controls the world's ceramic manufacturing market, accounting for more than 60% of the total supply. The situation may change drastically if the ceramic industry in Bangladesh is supported substantially by the government. High tariff and no subsidy are the barriers. Even then the industry is thriving at a tremendous space, often registering a double digit growth.

Contribution to the Economy (2006-07)

According to Bangladesh Ceramic Ware Manufacturers' Association (BCWMA), the ceramic sector earned 32.80 million US dollar by exporting ceramic products in the fiscal year 2006-07. In the fiscal year 1990-91, the export earnings amounted to only 1 million US dollar. The export growth rate has been 695% over the last 10 years. Also, Bangladesh ceramic products gained in value on the international market and the value addition rate has been 65 %.

On the local market, sales of ceramic goods amount to about 700 crore taka annually, out of which 500 crore taka is earned by products made locally while 200 crore taka by imported products. Over the years an increased production in the country has reduced import of ceramic products thus saving the country's valuable foreign exchange.

The sector employs about one hundred thousand (one lakh) labourers.

Tableware constitutes the bulk of ceramic exports and further growth is expected in this area as the companies in Bangladesh are paying particular attention to variegated designs and forms. Meanwhile, sanitary ware in Bangladesh is growing, too.

Strengths

Investment Prospects
According to S.A.K Ekramuzzaman, Director, RAK Ceramics Bangladesh (Pvt.) Ltd, the ceramic sector in Bangladesh is one of the most promising sectors in terms of attracting investment both from foreign and local companies.

Before tiles were fashionable items in Bangladesh but now they form the basic requirement for almost every building. Moreover, it is mandatory for garment manufacturers to have their factory floors covered with tiles.

UK Trade & Investment's Business Plan for Bangladesh in 2007/8 identified the ceramic sector as one of the top sectors for investment.

Md. Luthfor Rahman, Deputy General Manager, Finance & Accounts, Shinepukur Ceramics Ltd, says demand for ceramic tableware from Bangladesh in the international market is likely to be more than Tk.500 crore per year but currently Bangladesh is supplying products of about Tk.225 crore. So there are huge opportunities for investment in the ceramic industry in Bangladesh.

S.A.K Ekramuzzaman; Director, RAK Ceramics Bangladesh (Pvt.) Ltd, says the market for ceramic tiles was very small only a few years back and the demand was largely met by imported tiles. "When we started the business 90% of the building materials, tiles and sanitary ware was imported."

Problems