Chittagong Correspondent
KDS Group Chairman Khalilur Rahman has extended his business in Singapore, Hong Kong and the United Kingdom and now he intends to set up garment industries in Myanmar.
His success in expanding business beyond Bangladesh encouraged him to move one step forward to set up garment industries in Myanmar, said the man who started his career as a C&F firm employee while talking to this correspondent in an interview.
"I am looking forward to open up business in our neighbouring country Myanmar, albeit in association with the local businesses there," Mr Khalilur Rahman, now running one of the country's ten economic powerhouses and a leading garment exporter.
Bangladesh and Myanmar agreed to increase bilateral trade through establishing wholesale markets on both sides of the border to enhance mutual trade and economic cooperation, he added.
"Doing business successfully depends on honesty, efficiency and commitment. If you fail in any of these areas, you will fail to do good business with the foreigners," he said.
He started business with Tk 0.3 million and now owns dozens of industries ranging from textile, accessories, logistics, mineral, steel, IT, bank, insurance and what not.
He is one of the pioneers of the garments industry who started the
business back in 1982-83 after Desh Garments, the country's first ever garment industry set up in Kalurghat heavy industrial area in Chittagong. Desh Garments is called the mother of the RMG sector of Bangladesh.
A man from an ordinary Muslim family at Patiya of Chittagong , Khalilur Rahman narrated briefly to the FE how he became a successful entrepreneur of today's Bangladesh. He had been serving as an employee of a clearing and forwarding agency owned by a non-Bengali Muslim since 1960. Although he served till 1970 he started import of consumer goods at Khatungonj in the port city in 1967 and his owner also extended support to him in launching his business.
Turning to investment in the country, he said that the rate of interest in the banks is very high, which is one of the impediments. Investment will not increase as long as you keep the interest rate in the high range of 18 to 20 per cent.
"It must come down to a single digit or a little above. The undisclosed wealth should also be allowed into the mainstream of the economy. The number of direct investors in the capital market is around 20 million, and with them there are another 50 million people who have been affected by the share market debacle. So the banks should also reduce the interest rate," he said.
Asked how he entered the business, he said that from the inception he had felt for the people of his locality, most of whom were poor. It was not possible on his part to assist them with money, so he thought of setting up a labour-intensive industry although he was quite aware that running an industry had some sort of risk but consumer item import like oil fetches more profits but involves less risk.
He started his KDS Garments Industry at Kalurghat with only 360 workers, mostly from his West Patiya area. Now the employment in his enterprises has exceeded 25,000. The annual turnover of the KDS Group is Tk 45 billion while earnings from export-oriented industries alone are more than Tk 7 billion. His companies are paying about Tk 2 billion to the government exchequer in taxes and duties per annum.
He said that all monetary transactions while running the garment industry were done with the state-owned scheduled banks. But he was not satisfied with the activities of those banks, so he thought of doing banking business as money from garment exports started to flow in. He along with some other businessmen started operation of the National Bank and later Al Arafah Islami Bank while others started UCBL, City Bank and many others.
Khalilur Rahman said he established Bangladesh's biggest inland container depot at the Sitakunda coast of Chittagong, an excellent location beside the Chittagong-Dhaka Highway, at a cost of Tk 3 billion. The KDS Logistics sprawling an area of 40 acres has the capacity to handle 10,000 TEUs of containers, which is immensely contributing to the national economy through export and import trade.
The inland container depot (ICD) has all necessary logistic facilities for storing laden containers, enough space for empty containers, 0.16 million square feet of warehouse area, 14000 square feet for jute and imported goods, a large office cum administrative complex on 36,000 square feet, a large truck parking terminal, 650-KV stand-by generator, CCTV, modern fire fighting tools and other modern equipment for container handling.
"We are planning to shape up and expand this inland container depot as one of the biggest ICDs of this region with a target of annual turnover of Tk 800 million. Within next four years it will reach the break-even point, I hope," he said.
There is no country in the world where the ports directly handle cargo. "In other countries imported goods after delivery from the port go to the ICDs. But in our country the goods are delivered to the consignees after opening the container boxes. As we are directly involved with the export and import trade, we are facing a lot in many ways," he said adding that these problems prompted him to set up the KDS Logistics.
About four thousand vehicles of different modes enter the port everyday, which causes a logjam of vehicles in the port city. "We have told the Finance Minister and the National Board of Revenue (NBR) to arrange delivery of all imported goods from the ICDs. It will enhance efficiency and productivity of the port, besides reducing extra pressure on the port and easing the traffic problem in the city."
To become a complete exporter of readymade garments was his mission in the beginning and he achieved that goal by setting up the Steel Accessories, which started exporting steel clips and hooks for hangers besides feeding the local RMG exporters. This is the first and only industry of steel hooks and clips, with state-of-the-art lab facilities and testing equipment with a capacity to produce 100 million pieces per month.
The strength of the Steel Accessories lies with the KDS' long heritage of managing a global business with great achievement while the group has better market knowledge and expertise in the apparel and steel business which is supported by its flawless quality control and expert human resources.
A Bachelor of Science in Management, Khalilur Rahman is the group chairman of some 18 RMG-related companies including cotton, textile and accessories industries, four steel re-rolling and CR coil industries, and founder chairman of 15 schools, colleges, university, madrashas and cultural academies.
The countries he is exporting goods to are the USA, Canada, Europe, Scandinavian countries, Japan, South Asian Sub-continent, Korea, Singapore, Taiwan, China, Thailand, Germany, India, Myanmar, South Africa, Vietnam, Liberia, Congo, Far East and Middle East countries.
Rahman has been awarded the status of CIP (commercially important person) for 16 years. He clinched the President Gold Trophy for high performance in export of readymade garments in 1985, 1987, 1995, 1996, 1997, 1998, 1999, 2001 and 2002, the Golden Medal for export of quality RMG from the USA in four years, the Golden Trophy from Spain, the National Export Trophy in 14 years, awards from KMART Corporation and many other national and international awards. He has been awarded Vijaya Shree, an International Buddhist Award in 2009.
