Table of Contents

Introduction .................................................................................................................................................. 3
Chapter 1: Overview of Packaging Industry in Bangladesh .......................................................................... 5
1.1 BGAPMEA Scenario in brief................................................................................................................. 5
1.2 Five Years Bangladesh Export Summary and Accessories & Packaging contribution:......................5
1.3 A Brief Explanation..............................................................................................................................5
1.4 Incentives and new destinations of RMG vis-à-vis Accessories and Packaging destination: ............. 6
1.5 GSP- a candle light issue: ....................................................................................................................6
1.6 RMG future export targets vis-à-vis Accessories & Packaging:......................................................... 7
1.7 Garment Sector Productivity Scenario:.............................................................................................7
1.8 Salient observations/points to be considered:...................................................................................8
1.9 Production and use of packaging........................................................................................................9
1.9.1 Paper based packaging ................................................................................................................ 9
1.9.2 Plastics based packaging............................................................................................................ 10
1.9.3 Jute packaging............................................................................................................................11
1.9.4 Metal packaging.........................................................................................................................12
1.9.5 Glass packaging ..........................................................................................................................12
1.9.6 Wood packaging......................................................................................................................... 12
1.9.7 Other packaging components....................................................................................................13
1.9.8 Printing industry.........................................................................................................................13
1.10 Trade in packaging materials ........................................................................................................13
1.10.1 Imports.....................................................................................................................................13
1.10.2 Exports .....................................................................................................................................14
1.10.3 Future prospects and trends....................................................................................................14
Chapter 2: BRIEF DESCRIPTIONS ABOUT PANBOND INTERNATIONAL LTD. .............................................. 14
2.1 PANBOND INTERNATIONAL LIMITED is based with following Machineries:-................................... 16
2.2 Production capacity ..........................................................................................................................17
2.3 List of Key Customers:....................................................................................................................... 17
2.4 COMPANY POLICY / VENDOR OF SOCIAL COMPLIANCE ................................................................... 18
Chapter 3: Prospects and Potentials of packaging sector..........................................................................21

1
 3.1 Greening the packaging: ...................................................................................................................21
3.2 Packaging: A Cross-Cultural Perspective...........................................................................................22
3.3 Environment Magic word: Environmentally friendly = recycling...................................................... 22
3.4 Social responsibility: Shoppers vs. marketers...................................................................................23
3.5 Packaging Compliance Requirements............................................................................................... 24
3.6 Some Packaging Companies Listed in BGAPMEA..............................................................................25
Chapter 4: Recommendations and Conclusion........................................................................................... 26
References ..................................................................................................................................................28

2
 Evaluation of prospects and potentials of packing industry in Bangladesh.
A case study of Panbond International Ltd.

Introduction

Clothing is so essential that it is required from birth to death. Allama Shaikh Saadi (ra) required good
dress though he was a great scholar and had unparalleled knowledge. Packaging is an essential tool of
marketing. It establishes the identity of a product. It also brands or positions the product to attract the
right market that it wants to hit. Moreover packaging also protects both your product and your target
market or what we call the end consumer. That is why it is very important to have an excellent
packaging system to make sure that these objectives are met. Global population dynamics, design and
fashion, climate, safety (specialized garments- protective clothing, heat resistance clothing one day- a/c
clothing) are the basic factors for determining demand for textiles/garments vis-a-vis accessories and
packaging. Despite serious global financial meltdown starting in early 2008, Bangladesh economy not
only sustained the huge global economic surge after 1929’s great depression, but also performed well,
increased exports in successive years, in FY 2014-15 it went up by 43.36% up compared to previous FY,
while China the largest RMG exporter was shaken by the global financial crisis since 2008 and looked
down to make low end products. Bangladesh is now having above USD 19 billion forex reserve- the ever
highest in the history of Bangladesh, which is enough for one year import bills. RMG along with
accessories and packaging is the highest (83%) contributor in the government coffer. Despite
unprecedented destructive political violence in the country FDI reached the record high of US$ 1.61
billion in 2013. Since Bangladesh has been a lucrative business hub in Asia including delisting itself from
the grey list due to combating terrorist financing as well as money laundering. Reportedly 4254 SME
industries lost Tk.7150 crore alone and the county suffered a loss of Tk. 1 lac crore in the year 2014 due
to political power struggle in the country. Who shall compensate the huge property and life loss mostly
of innocent people due to undemocratic, irresponsible and ruthless violence simply for personal political
gains only? Apart from the protective function, packaging has a very important intermediate role in the
modern marketing. Being a link between production and consumption, the packaging carries a message
from the producer to the consumer. Packaging system, however, reaches beyond: includes also the
delivery, use of the product, and finally the treatment of the waste package. Since packaging is made
exclusively for the product’s sake, the packaging system is a part of the product’s system. The choice of
a packaging system is a very complex decision, and is based on the following main factors: Protection of
the product, available packaging technology, economics, marketing considerations, product’s properties,
environmental considerations, legal constraints. The overall negative image of packages derives from
their relatively high percentage in the household waste. Packages are never made for themselves. The
major basis of its existence is the delivery of the product to the consumer. Hence the packages can
never be viewed separately neither from the product, nor from consumption. The rising amount of
packages in the waste stream only indicates increasing consumption. Some materials, such as plastics

3
have the most negative image, albeit of being lightweight and sturdy, thus giving the advantage of
maximal service with minimal resource use. It is especially true for composites, which combine several
materials for better protection, while using minimal amount of the individual materials. Plastics and
composites are optimal packaging materials, and can therefore, be considered as environmentally
preferable. Reclamation of packaging wastes is an accepted way of reducing the packaging’s’
environmental impacts. Reclamation, and in particular recycling, however, are also industrial activities
and have resource demand, and result emissions. Recycling can be an important way in achieving
certain environmental goals, but it shall not be a goal by itself. Packaging is strongly influenced by social
and political preferences, regulatory and economic effects. In addition, packaging is not only a product:
a package, but a system, and the package itself cannot be separated from its content. Life-Cycle
Assessment (LCA) in turn is meant to assess products. Finally it can be asserted that even if packaging
plays an immense role in achieving a sustained development, it’s most important actors are the
consumers themselves. No regulation can be as effective as a well-informed, environmentally conscious,
ethical public.

4
Chapter 1: Overview of Packaging Industry in Bangladesh

1.1 BGAPMEA Scenario in brief

The association has now 1232 members(31.12.2015), starting with 17 members in 1991-the year of its
inception, membership growth rate is 7247 times and on average 55 companies joined the association
each year in a row, for last 24 years. The sector earned US$ 4.10 billion in 2014-15 FY. Reportedly the
plan is to earn over US$ 12 billion by the year 2018. It is a backward linkage industrial sector as demand
for accessories and packaging is a derived demand altogether at the moment. The demand for
accessories and packaging varies with the demand for RMG vis-à-vis exports.
(Basic Source: BGAPMEA & Author’s analytics)

1.2 Five Years Bangladesh Export Summary and Accessories & Packaging contribution:

FY Total RMG RMG Accessories Change Acc & Pgn % % of share

country share in share & Packaging in % of share in in RMG
exports in million in % exports in total exports(G)
million US $ UD $ million country
US$ exports (F)
2009-10 15565 12348 79 1852 - 12 15
2011-12 16205 12797 79 1920 3.67 12 15
2012-13 20629 18341 89 2751 43.28 13 15
2013-14 23704 20360 86 3075 12.00 13 15
2014-15 27027 22432 83 4100 33.33 15 18
Average 20626 17256 83 2740 23.07 13 15.6
(Basic data source: EPB and author’s analytics)

1.3 A Brief Explanation

The average county export in last 5 years is above USD 20 billion, of which RMG alone contributes over
USD 17 billion making 83% average contribution. Garment accessories and packaging on average
accounted for about quarter to USD 3 billion having an average share of 13% in the total country export
and having average growth of above 23% per annum. In RMG sector accessories and packaging
contributes about 16% in its export earnings. The sector has now 200,000 people in the primary
employment and about the same number in the secondary employment too.

It should be noted that there has always been a difference in figures between EPB export figures and
Bangladesh Bank export receipts figures. EPB accounts for exports as soon as shipping is done- on
accrual basis, while Bangladesh Bank accounts for, after export payments are received-on cash basis.

5
The time lag between export and receiving proceeds is usually maximum 180 days if document are
clean, not discrepant.

1.4 Incentives and new destinations of RMG vis-à-vis Accessories and Packaging destination:

Apparel export to non-traditional markets rose to US$ 3.5 billion in 2015 from merely US$ 800 million in
2008. This is a dramatic increase in last 7 years’ time, the result of government’s incentive package to
exporters for exploring new destinations for their products. This was certainly a good step forward.
Under the scheme the cash incentives have been as under:

Sl. No. FY Incentive in %

1 2010-11 5
2 2011-12 4
3 2012-13 2
4 2014-15> 2, continuing

The 13 new destinations for RMG are; India, Russia, South Africa, Brazil, Mexico, Malaysia, China, Japan,
Turkey, Chile, South Korea, Australia and New Zealand. Unfortunately accessories and packaging sector
has never received any incentive though its contribution towards export earning is impressive, and has
more in the future. If Bangladesh could avail only 10% global packaging market share it would be about
US$ 60 billion a year in near future.

1.5 GSP- a candle light issue:

Obama administration suspended Bangladesh GSP status in June, 2013 citing poor worker rights and
poor factory conditions. US government has laid out some conditions to be fulfilled to reinstate our GSP
status. The main conditions include improvement of labor and labor law, building layout, fire and other
safety standards, CBA rights of the workers. It is reported that out of 16 conditions 12 have already been
fulfilled and the remaining 4 shall be completed by March, 2014 and a comprehensive status report will
be ready for submission by April 2014. Bangladesh received US GSP advantage for its 0.56% of total
exports, while rest 99.46% of Bangladesh exports is subject to 16.5% US duty. MFN is a kind of sugar
coated (politically motivated) bitter capsule in the US overseas trade policy framework. May Day (Labor
Day) is not a holiday in USA though it is a globally recognized holiday in honor of the martyr workers
who were killed in the Hay market, Chicago, USA. Instead they have public holiday on the first Monday
of September. EU countries have to spend about 6% of their GDP for developing countries to bring them
up for making EU standard and environment friendly products for EU market. Now it is mostly AID for
Trade to achieve their goal through our efforts.

6
1.6 RMG future export targets vis-à-vis Accessories & Packaging:

Bangladesh is aiming at exporting RMG for US$ 30 billion by the year 2017 and US$ 50 billion by the year
2021. On average garment accessories and packaging contributes about 16% towards RMG export
earnings. Under this corollary and assumption the Garments accessories and packaging export earnings
may be estimated at US$ 5 billion to US $ 8 billion respectively. If packaging and accessories could be
exported directly together with deem exports the figure may even reach USD 60 billion latest by the
year 2025 and may stand as a parallel industry sector with RMG in terms of earning. Since the ITC,
Geneva funded Packaging sector study was accomplished in 2009 we could see a more than four folds
increase in its earnings in only four years’ time. What a wonderful achievement indeed!! Per McKinsey &
Company Bangladesh RMG export will be double in 2017 and triple in 2020. To make 30 accessories and
packaging items 100 other sub-accessories are required, and all are imported.

These targets may not be possible to achieve unless workers’ productivity is improved and restructuring,
BPR and modernization of process is done as well as safety and security is taken adequate care of with
stopping all kinds of hartal, blockade etc. In my opinion due to low end products customers’ market size
is high and this market will never go down as much as the high end. Bangladesh must not forget the
contribution of low end products in recent global financial meltdown, only concentrating for high end
products will not be a wise decision I believe. High end products should not also be left out to achieve
the target as the economic recovery in the developed world is again coming up gradually, it will see
good demand for high end products too. Some new and old competitors like Myanmar, even
Afghanistan Vietnam, Cambodia, Kenya, Tanzania, Uganda, Nigeria, Pakistan India, are also coming up in
a better shape and way. Infrastructural improvement including increase of motive power is also
significant. Hartal, blockade should be made illegal by law, as constitution says only peaceful, violence
free demonstration may be allowed.

1.7 Garment Sector Productivity Scenario:

Bangladesh is the second largest garments exporter having 5% global market share only; next to China
enjoying 31% of the share of total global market of US$ 450 billion. Though Bangladesh is the second
largest but the market share is only one sixth of China, a very wide gap between the first and the second
of course. Minimum monthly wages and productivity in few competing countries may be seen as under:

Sl.No. Country Wages in US$ Productivity in %

1 Bangladesh 69 77
2 Vietnam 78 90
3 Pakistan 79 88

7
The country needs to focus more on innovations and increasing workers’ productivity rate. Interestingly
one of our big NGO business man recommended garment workers’ wages level should be at par with
European countries. If it is so why those western buyers will come to us for their requirements, while in
some European countries are suffering from high unemployment rate as much as 31% even, radio
stations shut, home is dark for months, homeless sleeping in the street. Other than lower price and our
entrepreneurs high shock resistance power, courage, we have little other things to offer to the western
buyers. This is our competitive advantage out of many odds like; Shipment delay, commitment failure,
customs hassle, perfected government bureaucracy etc. are common features. I think those big people
wanted some cheap popularity as they have already been enjoying otherwise in the name of poverty
elimination and putting it in the museum!! Had it been so, why 6% people in America still live below
poverty level at this time and age of having its liberation for more than 225 years. We have seen and
known about Amish village in America, having no electricity, gas, TV, no modern facilities. In USA 1 out
of 4 people even does not know that the earth moves round the sun!

1. I do not think those who are propagating for European standard wages for Bangladesh garment
workers (what about others in the export and non-export sectors?) they have ever taken a look
at the productivity level of our workers, comparative cost of living, and high cost rather illegal
cost of doing business in Bangladesh. May be NGOs cost of fund is zero and no question of
refund of capital and they do not even know what are these terminologies altogether in
business. I think wages in the garment sector is moderate now compared to their productivity
level. Women workers in the garment sectors are usually highly appreciated by foreign buyers
for their high quality stitching skills. Social business? Is another stance now!
2. Interestingly the 8th government pay and service commission, in its first meeting declared that
the deliverables will take at least 12 months, what a wonderful efficiency! The tenure of the
commission is for 6 months having 17 members. The chairman also said no such commission
could deliver the product before 15 months. What an efficiency! Is there any record of
delivering any deliverables within the stipulated time in the government? Do they know working
under deadline? Humorously I must say all their lines are dead, and believe in postmortem only.
Why do they accept such things what they cannot deliver in time? Appoint someone who can
deliver and beat the deadline and can do things better than the past.

1.8 Salient observations/points to be considered:

1. A significant portion of the packaging converting industry is under the same ownership as the
RMG industry. Some of the 100% export oriented packaging units in RMG sector have sufficient
awareness of packaging quality requirements for exports and they source their raw materials as
per their customer’s requirements. However, such expertise remains within the company and
can by no means represent the state of the overall packaging industry in Bangladesh.
2. There are a few medium and large players-some of them with high end conversion machines
and QA and production control system-manufacturing flexible and plastic based packaging. But

8
 they have limitations in ascertaining the quality of their raw materials and of the final products
sold to exporters. Whatever expertise available in house, it is again not shared at industry level.
3. Suppliers to the international corporations such as Nestlé, Unilever, Coca Cola and others have
developed the skills and resources to provide packaging compliant with international standards.
At the same time, the average technical knowledge and understanding of food packaging
technology related issues is low.
4. Beyond the lack of technical knowledge and schemes available on the supply side, packaging
converters should be provided with the means to compete internationally with full access to
duty exempted raw and semi-finished packaging material used in the conversion of packaging
materials used for exports, across all user sectors.
5. Overall, the packaging converting industry lacks the supporting facilities, expertise and skills in
testing different materials, packaging design, optimizing costs, package printing and prepress
work, training of personnel, advising packaging norms and working on packaging standards etc.
6. The packaging converting industry in Bangladesh is not directly confronted with the
international competition of neighboring countries due to the constraints at import level. As a
result, the stimulus of international competition is not directly felt, which a significant threat is
for the future if borders were to open.
7. The need for developing knowledge and skills about export packaging is highly recommended.
8. Packaging is the key to export sectors like fresh and processed fruits and vegetables, herbal
products etc. and needs to be thoroughly understood in terms of its special requirements
including design, testing, information sharing, training as well as testing the raw materials that
go into conversion (food law compliance). A thorough understanding of quality and safety
requirements for the export markets therefore, cannot be overlooked.

1.9 Production and use of packaging

1.9.1 Paper based packaging

There are as many as 620 (50%) corrugated box manufacturers in Bangladesh and the rest 612(50%) out
of 1232 members BGAPMEA are manufacturing items like button, elastic and drawstring, poly, sewing
thread, zipper, labels, multi items and others. Quality of locally produced corrugated made from
imported Kraft paper is good on average and could be classified as: varying from High Standard to
Medium Standard to Average Standard. Bangladesh also has some factories with fully automatic plants
capable of producing world class quality corrugated boxes; some are managed by foreign experts.
Duplex board Cartons, labels, soap and other wrappers etc. are traditionally undertaken by offset
printing industry. There are a few units who manufacture cartons by hand pasting along with a good
number of automated industries. Only this industry subsector required 5000 MT of papers year alone.

9
One major observation that has emerged is that almost no corrugated board manufacturer is equipped
with the conditioning facilities and the testing equipment that are indispensable for the applied research
and quality control on corrugated board packages. Consequently, there is no way of ascertaining locally,
whether the structural design and specifications of a corrugated box are appropriate, below or above
the international standards concerned. Other paper based packaging manufactured locally includes
printed multi-wall paper sacks from extensible sack Kraft with self-closing valve for granular products,
top and bottom pasted sacks with or without plastic liners, high quality printed-paper shopping bags for
export and local market, paper cups for both hot and cold beverages etc.

1.9.2 Plastics based packaging

With around 3,000 of all kind of plastic converters and 100% import of raw materials (including
industrial and commodity plastics), the plastic industry is the fastest growing sector at around 10%
growth rate per annum. There are around 500 plastic packaging converters, manufacturing all kinds of
bottles, jars, closures, returnable crates etc. Commonly used resins include injection or blow molded PP,
PS and PET grades. Plant and machines in operation are a mix of old as well as new machines from
various manufacturers. Almost all types of resins varying from PVC to PE, Nylon, and PP are converted
for packaging applications. Industry has the facilities for local metallization on films, extrusion,
lamination solvent based as well as solvent free, gravure printing, simple jobs on flexo printing etc.
Woven polypropylene bags are also locally produced all type of industrial and commodity plastics are
imported in Bangladesh since there is no manufacturing facility available within the country.

Per capita consumption of Plastic in some selected countries:

Sl. No. Country Per capita consumption in KG/year

1 Bangladesh 5 kg
2 India 9.7
3 China 45
4 Pakistan 7
5 Sri Lanka 7.63
6 USA 109
7 Brazil 32
8 ASEAN 17
9 Nepal 2.4
10 Global average 30
(Source: Plastindia and Applied Marketing Info UK)

India is a growing market for plastics and consumes about 11 million MT annually against a global
consumption of 275 million MT per year. Plastics and polymer consumption is growing at an average

10
rate of 10% and is expected to touch 16.5 million tons by 2016. Per capita consumption of plastics in
Bangladesh is 5 kg per year which is the lowest among the comparator countries against the world
average of 30 kg per capita. Per capita consumption in India and ASEAN countries are 9.7 kg and 17kg
respectively. At present plastic consumption is also a measure of per capita GDP in a country.
Bangladesh produced plastic goods is increasing in the USA and European countries following imposition
of a ban on China-made plastic-toys.

The plastic products that are now on export list include shopping bags, butcher bags, PVC pipe,
polyethylene-sheets, ball- pens, tooth-brush, toys, hanger, hand- gloves, artificial flowers, table-covers,
computer accessories, wastebaskets and wall-clocks. Major destinations of Bangladesh plastic products
are Poland, China, India, Belgium, France, Germany, Canada, Spain, Australia, Japan, New Zealand, the
Netherlands, Italy, United Arab Emirates (UAE), Malaysia and Hong Kong. At present, there are 3000
small, medium and large plastic product manufacturing industries in the country and over 600,000
people are directly and indirectly involved in this industry.

1.9.3 Jute packaging

Bangladesh is the largest player in jute production along with India. 90% of the export items included
Hessian, jute sacks and others. Only 10% of the jute products are used in the domestic market for
packaging of rice, paddy, potatoes, wheat, pulses and others. The importers usually use these jute bags
for packaging of seed potatoes, raw seeds and food grains. Conversion technology is based mostly on
imported machinery from Europe. In most of the factories the in-process materials are stored on unique
bamboo pallets and finished products are stored on wooden pallets. Export markets over the last few
years have shrunk due to competition from PP woven sacks. Government encouragement to the sector
is provided including through a fully functional government research institute for testing and research.
Present financial condition of the industry is poor.

Reportedly 20 jute mills are now under lay off due to significantly sluggish local market and plummeting
international market. Syria, Iran, India, Thailand, Egypt, turkey and Sudan used to be the big markets for
our jute and jute products. Syria alone used to import about 70,000 tons of jute yarn followed by Iran
for about 40,000 tons of jute yarn a year. Due to US and EU economic sanctions on Iran and political
unrest in Syria the export has reached to zero level now. The Export earnings from jute and jute goods
stood at USD 466.17 million(down by 21%), while export of jute products has plummeted to 58.33% in
the last 7 months of the FY 2013-14 compared to the same period of last FY. The government in 2010
framed a mandatory jute packaging law, which was later made official in 2013 and all rice millers,
traders were instructed to get rid of their plastic packaging stocks by December 31,2013. Compulsory
use of jute packaging for food grains, fertilizer etc could boost the local market demand simply by
enforcing the law only. To my utter surprise making a law in 2010 could not see day light even in 2014,
while India enforced the same kind of law in 1987 in matter of few months only. The activities of the
Department of Jute, ministry and all other line supervisory organizations/persons relevant should be

11
investigated immediately for their dilly dally care free questionable activities which is causing huge
dame to the industry, country and its tax payers.

1.9.4 Metal packaging

Starting with the manufacture of aluminium pilfer proof caps in 1987, aluminium tubes in 1993, Crown
caps in the year 1999, the country has produced metal cans of different types and shapes With and
without printing since 2000. All the raw materials are imported from neighboring Asian countries. All
conversion machines are imported. One ISO certified Company with ERP, MIS and R and D facilities is
available for can manufacturing.

1.9.5 Glass packaging

Two local companies are currently producing about 110-130 MT glass bottles per day. The industry has
the capabilities to produce glass containers under Blow and Blow and Press and Blow processes,
including Narrow Neck (NNPB) and Wide Mouthed (WMPB) techniques for light weighting and jars
respectively. About 100 types of bottles in the capacity ranging between 15-1000 ml of various kinds,
shapes, sizes and colors, both in decorated/non-decorated, are being manufactured to cater to the
demand of domestic customers as well as for export markets for all pharmaceuticals, beverage, liquor,
processed food, cosmetics and perfume industries. The industry produces both clear flint and amber
color glass bottles. Locally available raw materials and imported raw materials are used. The industry
has incorporated its technology from Europe. The industry has a good number of gas fired furnaces with
fully automatic IS (Individual Section) machines. The molds are imported from abroad. One of the
companies is using tray and shrink wrap as outer container for distribution of the bottles, whereas the
other company is using corrugated box with shrink-wrap. Quality Control and R and D Sections are well
equipped with sophisticated instruments. The industry has well equipped laboratories, which contribute
to produce international quality containers. All raw materials and finished products are statistically
sampled and analyzed in the laboratories to ensure that they meet specific quality standards. The
industry has self-sufficient machines in their workshops. The industry has a team of qualified,
experienced and skilled glass technologists, engineers and technical staff. One of the companies is
diversifying by setting up a PET bottle plant.

1.9.6 Wood packaging

The wood packaging industry which was active in 60’s seems to have been perished in the present time.
The use of wooden cases is rare and the user industry hires carpenters to fabricate wooden cases if
required. Similarly there is no wooden pallet manufacturing industry and here again the user industry
takes the help of local carpenters to fabricate wooden pallets as per their specifications. However the

12
country has a few large plywood industries. At the same time certain types of plywood are also
imported. The manufacture of wooden crates and pallets is a handicraft activity, without specific
compliance to international standards and quality commonly used in many other countries. The hand
tools used and the skill of the artisans concerned do not allow the high productivity, which would be
required for the achievement of low production cost.

1.9.7 Other packaging components

Inks used for gravure, offset and flexo printing are all imported except for the very low end non food
printing jobs. Good quality starch based adhesives for the corrugated industry and the solvent based
and solvent free adhesives by the flexible packaging industry are also imported.

1.9.8 Printing industry

There are more than 12,000 members of the Bangladesh Printers Association spread all over the country
involved in all kind of printing jobs. The offset printing industry in Bangladesh is the old industry.
Investment in the printing industry has grown in a phased manner and today the industry is active with
offset, gravure, screen and a few flexo printing machines. High quality gravure cylinders as per the world
standards using world-class technology as well as high quality offset printing jobs are produced by some
players. Over the years an appreciable development in producing high quality offset press jobs has been
reported

1.10 Trade in packaging materials

1.10.1 Imports

The majority of raw material has to be imported for conversion. This includes almost 100% plastic
granules and 80% paper. All raw materials including duplex board are imported mostly from the Asian
countries. The level of imports has been increasing as a result of growing domestic demand. India, China
and Singapore are the major sources of imports to Bangladesh.

13
1.10.2 Exports

Though there are no direct export of packaging and packaging materials(other than plastic products),
the deemed exports on account of RMG sector predominantly account for more than 80% of the total
exports from Bangladesh and Packaging and accessories account for about 16% of the RMG exports. The
major export markets for Bangladesh readymade garments are EU, USA and Canada and the laws in
these countries govern the quality requirements demanded out of packaging. Around 400, 100% export
oriented plastic units in the country exported plastic goods to 26 countries of the world in the North
America, Europe, Asia, Pacific and the Middle East regions. The five major destinations of Bangladesh
plastic goods are; People’s Republic of China, India, The Netherlands, Germany and Poland. Plastic
wastes such as used PET bottles worth US$ 8-10 million a year is exported to China.

1.10.3 Future prospects and trends

In the absence of local facilities to manufacture raw materials used by the packaging sectors like virgin
Kraft liners, board and other quality of paper, commodity plastics many of them safe for food contact
applications, prime tin plates etc. imports of these materials will continue at the growth level matching
the packaging industry high growth. However, there will be a greater emphasis in procuring these
materials with the test and quality certificates in conformation to their planned use. With the cheaper
and abundant gas supplies resulting in lower energy costs, conversion units especially plastic and paper
based will look for the opportunities for export of high quality packaging to certain preferred areas. The
export potentials of packaging sector are as bright as RMG even may be more. RMG global market size is
USD450 billion, while Packaging is of USD600 billion, means more than 33% higher and growing at a
speed of 10% pa.

Chapter 2: BRIEF DESCRIPTIONS ABOUT PANBOND INTERNATIONAL LTD.

PANBOND INTERNATIONAL LIMITED is vertically integrated an export oriented PACKAGING INDUSTRY, in

Bangladesh. It continuously works hard to achieve organizational objectives by strategic approach in its
way of work and provide innovative and reliable products and services to its customers in the global and
local market.
PANBOND INTERNATIONAL LIMITED was formed in 2004. The company is a member of Bangladesh
Garments Accessories & Packaging Manufacturers & Exporters Association (BGAPMEA). Its
membership no. is 531.

14
PANBOND INTERNATIONAL LIMITED is involved in the handling of products and provision of services in a
broad range of sectors. These areas encompass importing and exporting related to shoe box packaging
and all types of garment accessories. The Company provides best quality products to the buyers.

Nazma Akhter Reakha (Chairman)

Md. Abdul Hannan Mollah (Managing Director)

Mobile: +880-1819245034

E-mail: hannan@advancesweater.com

Board of Directors Md. Mahbubur Rashid (Director)

Mobile: +880-1714218012

E-mail: packaging14pp@gmail.com

Location of the factory Village: Vawraid, Post office: Ipsha, Upazilla:

Gazipur Sadar , District: Gazipur, Bangladesh.

Floor space of the factory 15,000 square feet.

Number of workers 50-70 Nos.

Yearly Shipment $ 15, 00,000 -20, 00,000

Banking transactions with * SOUTH EAST BANK LTD,

DHANMONDI BRANCH, DHAKA.

SWIFT # SEBD BDDHDHN

* NATIONAL BANK LTD,

BANANI BRANCH, DHAKA.

SWIFT # NBLBBDDH106

15
2.1 PANBOND INTERNATIONAL LIMITED is based with following Machineries:-

Name of Machineries No. of Machineries Manufacturing Country

Corrugations Machine 01 set Made in India

(“c” flute size-45”)

Auto Paper Cutting Machine 02 Sets. (Made in India)

Offset Printing Machine

*Roland Record model-1988,
Print size-28”X36”

*Heidelberg Surd model-1994, 02 Sets. (Made in Germany).

Print size-25”X36”

Lamination Machine 01 Set. Made in India

(Size-27”)

Pasting Machine (Auto/Manual) 02 Sets. Made in India

: ( Size-43”,65”)

Pressure Machine (Auto) 02 Sets Made in India

Die cutting Machine 04 Sets. Made in China

PP Machine 02 Nos.

LDPE Machine 02 Nos.

Bottom Cutting Machine 02 Nos.

Side Ceiling Machine 01 No.

Flexo Printing Machine 01 No.

16
Crushed Machine 02 Sets.

*STANDBY GENERATOR 01 Set Nippon Osaka Japan.

2.2 Production capacity

Shoe box : 2, 60,000 set /Month.

Photo in lay : 25,000 Dz / Month.

Hang tag : 30,000 Dz /Month.

Size tag : 30,000 Dz /Month.

Price tag : 30,000 Dz /Month.

Poly bag : 80,000 Dz /Month.

Blister : 10,000 Dz /Month.

Elastic : 14,000 yrd /Month.

2.3 List of Key Customers:

01) FB FOOTWEAR LTD.

02) FOOTBED FOOTWEAR LTD.

03) AKIJ FOOTWEAR LTD.

04) BMTF SHOES LTD.

05) ITALTECHNO PVT LTD.

06) MARS RESORCE IND LTD.

17
07) ROSE SWEATER IND LTD.

08) NEXAS GROUP.

09) ADVANCE SWEATER IND LTD.

The company believes and hopes that it can maintain better standard in PACKAGING SECTOR. As it cares
for CONSUMER SATISFACTION by ensuring TRANSPARANCY, HONESTY & CAPABILITY in every respect,
the company is confident to keep its GOOD WILL in the field of Printing and Packaging Products.

2.4 COMPANY POLICY / VENDOR OF SOCIAL COMPLIANCE

Panbond International Ltd. believes in motivation, good behavior and in teaching & learning method.
All sorts of behavior that is threatening, abusive or exploitative are restricted in this organization.
It wants to make a good environment to work (if that is not out of our Labor Law) for maintaining the
company and want to develop Country’s economic side.

1. Anti-Discrimination/Harassment/Abuse:

The company is committed to prohibit discrimination on ground including gender, race, ethnic origin,
religion, caste, political belief, region and language. We believe that employment, payment, promotion,
appraisal or penalty decisions are made on the basis of an individual’s qualification and capabilities
rather that personal pauses considering the factors like religion, cast, gender, issue, personal relation,
age etc. The company is committed to providing a work environment that ensures that every worker is
treated with dignity and respect and afforded equitable treatment. We also committed to promoting a
work environment atmosphere and equality of opportunity.

The company will not tolerate any form of harassment and committed to take all necessary steps to
ensure that worker is not subject to discriminate and harassment.

The company policy guarantees worker the right to employment in work places free from harassment
and discrimination.

Whether favoritism or discrimination, prejudice is an enemy of a free people our company does not
tolerate any form of discrimination, harassment or prejudice in any internal or external business affairs.
2. Recruitment Policy:

18
A. Management published Advertise by News Paper, Poster or other Source for a New Recruit.

B. Collected 2 copy passport size & 2 copy stamp size photographs, National ID/Birth Certificate copy or
Nationality Certification by UP Chairman or City Corporation Commissioner.

C. Educational, Working Experience and others Certificate collect (if necessary).

D. Working skill, I.Q. test and etc. test by Own Department Head and HR Division.
e. Age and Working Fitness test by Factory/Authorized Doctor.

F. At the time of Service Joining, provide Appointment Letter, Service Guide, Attendance card and
Identity Card.

G. Trained and Acknowledged about Industrial Law, Company Policy and etc.

H. Strictly Prohibited Discrimination on Ground including Gender, Race, Ethnic Origin, Religion, Caste,
Political Belief, Region and Language. Never tolerate any form of Discrimination, Harassment or
Prejudice in any Internal or External Business affairs.

I. No Employee below the age of 18 years.

J. No Prison Labor, Indentured Labor, Bonded Labor or otherwise.

K. Force Labor is strictly prohibited.

L. Minimum Wages which are fixed by Government is provided.

3. Working Hour:

In terms of working hours we follow the Code of Conduct of National Labor Law.
Weekly duty schedule:

A. Per day 08 (Eight) hour,

B. Weekly 48 (Forty Eight) hour,

C. 06 (Six) day in a week.

D. Including over Time (O.T.) work total 60 (Sixty) hours for a week. O.T. rate is double of Basic pay, such
as, O.T. Rate = Basic ÷ 204 hour (26 Days X 08 Hours.) X 2 (Double).

19
E. One hour rest time for more than 06 (Six) hour or Half hour for more than 05 (Five) hour work.

4. Wages:

At least the minimum total compensation required by Local Law. The wages for the workers of each skill
level is divided into three components:
A. Medical = that is fixed at Taka 200.00

B. Basic salary

C. House rent = that is 40 percent of basic pay.

Minimum pay for the Assistant workers is Taka 3000.

Trainees and apprentices shall be given Taka 2500.00 per month for a maximum period of three month.

Payment must be paid within first 07 (Seven) working days in every consecutive month.

Payment will be paid in cash.

5. Benefits:

A. Attendance Bonus: If any worker has no late or absent in a calendar month, will get Attendance
Bonus amounting to Taka 200.00 for per month.

B. Target/Production Bonus: If a worker achieves to fulfill target, then get this bonus.

C. Festival Bonus: Company pays Two Festival Bonus for a calendar year. (Conditions apply)

D. Overtime Work: Duty of any holiday, festival leave day or excess work more than 09 (Nine) hours
including

01(One) hour rest time, is granted by Overtime Work.

E. Other Allowances: Conveyance Allowance, Food Allowance, Other Allowance (Conditions Apply).

20
Chapter 3: Prospects and Potentials of packaging sector

Packaging is an essential part for product distribution. For the export-import business packaging is must.
There are many opportunities for this industry to make a bigger contribution in the economy of the
country. In below some prospects and potentials are mentioned:

∑ Cheap labor and availability of skilled manpower for general operations

∑ Availability of bonded facilities and other benefits/ incentives for exports
∑ Already vibrant export sectors like RMG, frozen fish and shrimps that can be extended to other
sectors like value added agro products, fresh fruit and vegetables etc.
∑ Abundant and cheap gas energy options to run the manufacturing operations
∑ Growth in consumerism due to foreign remittance by Bangladeshi expatriates and good ROI of
business.
∑ Possibility to offer a wide range of value added packaging products to the global export market
∑ Good stretching quality of our women garment workers
∑ Very low per capita consumption of packaging and huge potential for growth in local and export
markets
∑ Entrepreneurs in SME sector today are taking interest in knowing the key challenges the
packaging sector is facing and are looking forward to the new opportunities for growth
∑ Newly added huge production capacities for manufacturing of flexible packaging have created
an opportunity for exports through QA production
∑ Opportunity for global sourcing of best quality of raw materials at competitive price
∑ Possibility of manufacturing packaging raw materials in the country due to abundant gas energy
and market potentiality
∑ Growth of large super markets and consumers life style change
∑ Global packaging market is about USD600 billion now, and yearly growth rate is 10%

3.1 Greening the packaging:

Rethink> Reduce> Recycle> Reuse=F4R Principle

Increasing socio-economic development coupled with rapid urbanization has resulted in significant
growth in the manufacture and importation of packaged products. This has led to a massive increase in
the generation of post-consumer waste and environmental pollution. For instance, there has been an
increasing use of plastic packaging for consumer goods over the last two decades in Bangladesh and this
waste is creating considerable environmental challenges. As per estimates household packaging waste
generated in Bangladesh consists of 5% paper, 2.6%, metals, 2% glass and 4% plastic. The bulk of this is
disposed of at refuse dumps where they are burnt, left to degrade or deposited in landfills.
Unfortunately poor management of plastic waste has resulted in a lot of litter resulting in a bad image

21
for plastics as packaging material. Uncontrolled littering has drawn the attention of government to
introduce legislation to control the impact of waste on the environment.

The environmental protection agency in collaboration with the Ministry of Environment has also
instituted measures aimed at reducing, re-using and re-cycling of “used packaging materials” in order to
reduce the impact of packaging waste on the environment. To encourage companies to invest in
activities that will assist in Bangladesh’s efforts to introduce efficient waste management systems,
companies which establish factories whose principal activity is waste processing including re-cycling of
plastic and polyethylene material will pay no corporate tax say for the first 5 years of their operations
irrespective of location should be introduced. Currently disposed mono films and bags are recycled by
converting into small pellets and sold to outside vendors/third parties who use them for manufacturing
a variety of items. Pet bottles waste chips are made locally and exported.

3.2 Packaging: A Cross-Cultural Perspective

There is, however, a lot of criticism against packaging, for their environmental effects. The attention of
consumers is turned especially towards packaging of everyday goods, such as food, and household
detergents. Few appreciate the roles of packaging, and even less knows that packaging has positive
environmental effects. The positive effects of packaging are the safe delivery of the product to the
consumer while preserving the designed and processed usage and/or aesthetic values of the product.
Packaging also plays an important role in saving natural resources by preventing the product to be
wasted and the invested material and physical labor getting lost. Since the value of the product
generally far exceeds that of the package, the optimal product use, is more important than the optimal
package use. While the package prevents the product to be contaminated, it also prevents the
environment to be polluted by the product. To summarize, the packaging is an important tool of optimal
resource use.

3.3 Environment Magic word: Environmentally friendly = recycling

Wal-Mart’s introduction of its sustainable packaging scorecard program has galvanized the industry,
leading nearly all suppliers to begin developing more environment friendly packaging systems in order
to remain on retail shelves. Specifically, they were looking to address two primary questions:

Do they know? Do shoppers know which packaging systems are better for the environment?

Do they care? Do environmental considerations have an impact on their packaging preferences and
purchase decisions?

22
When asked what makes a packaging system environmentally friendly, shoppers around the world
consistently offered a one-word answer: Recycling. In all markets, a clear majority of shoppers cited
“made from recyclable materials” as the primary factor they used to determine if a package was
environmentally friendly. Interestingly, this “magic word” appears to trump other considerations,
including quantity of packaging material used (i.e., use of primary and secondary packaging). In addition,
separate research suggests that most shoppers do not distinguish between “made from recycled
materials” and “recyclable” although the two are often mutually exclusive.

3.4 Social responsibility: Shoppers vs. marketers

First, we asked if shoppers should be willing to pay a small amount more (5-10 cents in the US;
comparable amounts globally) more for packaging that is environmentally friendly. Interestingly, the
percentage of shoppers who agreed was highest in the US 67%, comparable across the UK48% and
Germany 50%, and lowest in China only 23%. This may be a reflection of varying societal attitudes
regarding individual responsibility. Interestingly, however, when the same question was phrased in the
context of personal willingness to spend more for environmentally friendly packaging, more than 80
percent of Chinese shoppers claimed that they personally were willing to spend more, as opposed to
approximately two-thirds in other countries. We phrased a similar question in the context of
manufacturers’ responsibility—and uncovered a very different perspective. In all four countries, more
than 80% of the consumers interviewed agreed that “it is the manufacturers’ responsibility to produce
more environmentally friendly packaging, without passing along costs to shoppers.”

Although there are lots of potentials of packaging industries in Bangladesh, the industry is facing some
problems also. There are many obstacles which hinder the progress of this sector. Some hindrances are
mentioned below:

∑ Packaging associations seem to be a little reluctant in their role to bring packaging industry
together in discussing their problems, sharing their achievements and working on creation of
common facilities like a testing and training center.
∑ Packaging associations should not work in water tight compartments to share common views
and intent regarding the strategies and plans for the growth of the packaging sector as a whole.
They also should collaborate in optimizing their costs
∑ Packaging converters have a limited understanding of what it takes to compete in demanding
markets such as the EU. As a result, they are not able to advise their export customers, leading
to a fundamental gap in the ability for Bangladesh to succeed on exports
∑ Packaging converters need to send their packaging samples for analysis to Hong Kong and other
places, which is uneconomical and time consuming

23
 ∑ Inadequate efforts and resources to prepare packaging standards provide testing facilities to the
industry conduct local R&D, train personnel etc.
∑ Too much dependency on few export sectors, especially on RMG export(83% of total exports)
∑ Lack of harmonize packaging standards with regional and international standards
∑ Shortage of skilled manpower to run high end packaging manufacturing operations, develop
designs, run test equipment etc.
∑ Lack of packaging policy and exclusive Packaging Industrial parks
∑ Knowledge gap in packaging science and technology
∑ Most of the industries work with sub optimal technologies
∑ Non availability of local raw materials. High lead time for imports resulting into high inventory
costs, inviting leakage of profit.
∑ Packaging converters in general have been performing and responding to the relatively “simple”
requirements of the RMG sector and are not geared up to address the complex issues of food
preservation: mastering hygiene, preventing oxidation, aroma loss, UV degradation, transport
worthiness etc.
∑ Very few export portfolios; mainly dependent on RMG and frozen fish and shrimps
∑ Large numbers of export orders are lost due to delays in meeting deadlines for shipments
∑ Some contributory factors are customs clearance, port delays, hartals, blockades and other non-
patriotic activities etc.
∑ Powerful neighboring countries with ability to offer high quality and cost effective packaging
∑ High taxes and duty structures, high interest rate, castigative attitude of some inexperienced
auditors, cascading of audits, consuming business time, money and energy

3.5 Packaging Compliance Requirements

Companies who sell packaging and packaged goods in Europe must comply with packaging substance
restrictions, reusability and marking requirements and provide for packaging collection, recycling and
reporting. The packaging directive requires 'responsible parties’ to comply with the directive when the
packaged goods are placed on the market in any EU member states. Responsible parties can include
suppliers of packaging materials, packaging producers and converters, fillers and users, importers and
traders and distributors of packaging. Increase the recovery and recycling of packaging waste in a
consistent way in all EU member states. To reduce the amount of packaging used and to encourage the
reuse of packaging. To limit the concentration levels of certain heavy metals used in packaging products
in order to reduce the environmental impact of packaging products which are land filled or incinerated.
The legislation sets mandatory recovery and recycling targets that member states must achieve, the first
of which were required to be met in 2001 and continuing.

24
3.6 Some Packaging Companies Listed in BGAPMEA

Sl No Name of Companies Membership No.

1 Royal Accessories Link 1381
2 A to Z Printers 1281
3 Abhoron Trimmings Ltd. 1271
4 Banga Plastic International ltd. 1292
5 Dress Device 1288
6 Kafee Packaging 1268
7 LR Industries Pte. Ltd. 1285
8 Orient Button Ltd. 1295
9 Triming Paragon 1266
10 Baly Plastic Industries Limited 1296
11 Blue Blaze Polymer Ltd. 1283
12 Panbond International Ltd. 531
13 Broadway Printing Industries 1354
14 Cactus Printing & Packaging Ltd. 1336
15 Chitra Accessories Ltd. 1368
16 Virtual Trims Ltd. 1344
17 3MS Tex (BD) 1161
18 A & A Accessories Ltd. 189
19 A-1 International 756
20 A-Tex International Ltd. 1098
21 A. A. Accessories Ltd. 1124
22 A. B. S. Carton & Accessories Bangladesh Ltd. 369
23 A. H. Packaging & Accessories Ltd. 624
24 A. K. Accessories (PVT.) Ltd. 1049

25
Chapter 4: Recommendations and Conclusion

Though few recommendations saw day light particularly in Bangladesh in my last 30 years of delivering
thousands of lectures all over the world; still I have to recommend. It is decided to have as few
recommendations as appear to be most essential and relevant in this case.

1. There must be a Packaging Training Institute offering 2 years post-graduation diploma course to
cater for the dearth of trained manpower in the sector. Ministry of commerce and industry may
jointly take the lead for the sake of making fit and proper professionals for this export oriented
fast growing important sector

2. There should be a packaging research center and well equipped testing laboratory to facilitate all
kinds of packaging testing, research, local and foreign information dissemination etc.

3. Facilitate the sector for exporting of high end packaging products as well as low end

4. Resolving all trade barriers prevailing in the sector such as VAT, TAX, customs, bond, bank loan,
high borrowing rate of interest

5. There must be packaging policy and exclusive packing industrial park

6. The global packaging market is about USD 600 billion and growth rate is 10% pa for which the
country must aim this market to catch fast very fast

7. The sector deserves cash incentives like other export sectors and that should be given from next
FY, and budgetary provision must be made in the coming budget

8. Government must go for wastage control and cost control simultaneously

9. Why the UP is hanged despite minister’s approval, which must be practically implemented
immediately. Ministers themselves should follow up implementation of their instructions
personally.

10. Immediately introduce Reward for good job(fulfillment of target) done and punish for bad
job(failure of target) for the government servants, starting from the top

11. Auditors credibility is highly questionable, open up this service sector for foreign audit firms

12. Avoid double taxation in RMG and Accessories and Packaging sector

26
 13. Ministers are expected not to make commitments what they cannot fulfill and implement, which
turn to be hoax, shameful and embarrassing for the ministers, PM etc. It may happen mainly due
to twisting of the things by those who think are not accountable to the people for 30 years of
their service life, while politicians are accountable to people and face voters every five years’
time.

14. Pre-budget opinion meetings with various trade bodies mostly turned to be another pretention as
some clever people always down play with the suggestions and in their own way.

15. There must be coordination among all the relevant ministries on any particular issue and should
be settled within a stipulated time frame.

16. Productivity improvement is a joint effort of the employers and employees and technology
improvement is one of the pre-condition for productivity improvement. Towards this end we
should be seriously mindful for improvement of both technology and productivity.
17. BPR must be there in the business and the government offices starting with customs office

18. Since Association is permitted to renew bond license for 2 years, why the raw materials import
permission per 60% of installed capacity is in the hands of NBR, as a result the whole matter is
half-baked and hence no/ little use. It should also be allowed to the Association to reap the real
benefits

19. There are audits from bond, revenue (AGB), Bangladesh Bank etc. This type of duplication
triplication, quadruplicating of the same thing is just wastage of money ,energy and time, and
turned to be sheer harassment
20. Loan classifications should be like before not the prevailing Special mentioned Actt(SMA) for 1, SS
for two months default.
21. Though electricity supply has improved but gas and electricity is still problem, that must be
resolved sooner.
22. Loan conditions are significantly not business friendly; it should be at par with other export
industries like RMG and so.

Packaging industry has great potentials in Bangladesh. The industry is growing so fast. If the government
provides adequate facilities then this industry can make a huge contribution in our total economy.

27
References

∑ Company Profile of PANBOND INTERNATIONAL LIMITED

∑ Company Annual Report of 2015

Website Links:

∑ http://www.bgapmea.org/
∑ http://www.bssnews.net/newsDetails.php?cat=2&id=462603&date=2015-01-14
∑ http://www.addressbazar.com/Article_Title_Body.php?Sub_Category_ID=610
∑ http://www.bdtradeinfo.com/yellowpages/des_data.php?subcategory_id=650

28