In 1976, Altaf Ali Committee recommended a fundamental change by proposing a forestry commission headed by the Minister as the Chairman and an officer, of the rank and status of the Secretary, as the Executive Vice Chairman. Beneath this were several autonomous boards and corporations headed by a member of the forestry commission. The forestry boards, BFIDC and the Rubber Board were designated as autonomous and self-financing. The suggestion was to return 20% of the revenue collected by Government, with the rest ploughed back to approved plans and programmes. This proposal was not acted upon.
Experience in other countries This shows that administrative bureaucracies are not the appropriate institutions to develop and manage forestry enterprises; and that it is not rational to assign law enforcement and enterprise functions to one and the same agency. The attitudes and approaches needed to run an enterprise profitably and efficiently are very different from those suited to a law-enforcing bureaucracy. |
Reorganization resulted form the Enam Committee report in 1983 and later in 1985 under the Huda Committee report. Both reports advocated an increase in the number of units and staff but without basis for administrative reform. Administration remained as centralized as before. Subsequently, BFD made some internal proposals for strengthening in 1989. An Asian Wetland Bureau report contained suggestions for strengthening the conservation capability of the Department; and World Bank included some reorganization/strengthening of BFD as a component of its Forestry III project.
Proposed changes under the Forestry III project call for Chief Conservator of Forests, assisted by four Deputy Chief Conservators of Forests responsible for planning, forest management and operations, extension, and environmental management, respectively; and a Conservator of Forests (CF) in charge of finance and administration. Field level changes provide each Conservator at least one Deputy. In addition, new offices established are a Conservator's office for supervising coastal plantations, a Management Plan Division for management plan preparation for the Sundarbans and coastal plantations; plus new two Forest Divisions for managing sanctuaries, national parks and other protected areas.
The Fourth Five Year Plan recommended managing industrial forest plantations and forest estates like tree farming enterprises for specific end uses.
All prior proposals remain incomplete. A recent public announcement concerns a new Department of Social Forestry created by splitting the present Department. Full details and implementation schedule are under further development and consideration by Government.
BFIDC's organizational situation is comparable to the Department's, even though the Corporation legally started at the autonomous East Pakistan Forest Industries Development Corporation. The Corporation began in 1960, as a state owned company, for developing timber-based activities in the Chittagong Hill Tracts. It is now a semi-autonomous agency under the MOEF, owning 16 enterprises - two timber extraction units, 11 wood-based industrial units, and three board manufacturing plants. Many are inoperable or not profitable. It also has 11,700 hectares of rubber plantations spread over 12 estates of which over 5,000 hectares are in production. BFIDC employs some 4,000 persons.
Opening Status - Because of raw material shortage and operating inefficiency, poor facilities, storage of qualified staff, the Corporation's plants operate well below capacity, around 40% in 1989/90, and around 30% in 1990/91. As a result, the Corporation incurred losses amounting of Tk 37 million in 1989/90 and about Tk 50 million in 1990/91.
Despite its semi-autonomous status, deficiencies in the operational structure and controls, as a public sector undertaking, make it difficult to run BFIDC as a business enterprise. Inflexibility and rigidity, coupled with a lack of decentralization of delegation of decision powers, common in administrative bureaucracies, burden its operations. BFIDC lacks true autonomy and incentive to act, which breeds inefficiency. Old and worn-out equipment, lack of maintenance and investment in modernization, a disproportionately large labour force and marketing inadequacies are common. Government is seriously considering the problem through public enterprise reforms encompassing investment, financial restructuring, institutional improvements and pricing policies. Constraints and the steady erosion of its raw material base seriously undermine the viable functioning of BFIDC.
Rubber Development - The Corporation started its rubber plantation programme in 1962. The rubber plantation venture is promising and technically successful. However, production costs are high compared to the other rubber producing countries. BFIDC implemented rubber projects are highly centralized and commercial orientation is lacking in the daily estate operations. A decentralized management structure and autonomy is required for the efficient operation of the rubber estates, and to permit appropriate response to the changing requirements unforeseen in approved budgets and work plans.
Recently, an Asian Development Bank review note that one of the main lessons emerging from the Rubber Rehabilitation project and past experiences is that a commercially-oriented corporate approach to management is essential for Bangladesh's emerging rubber plantation industry. This approach requires additional improvement to BFIDC's operational structure, a gradual introduction of private sector orientation and ownership. As proposed by the Bank, this orientation is only possible after undertaking several financial restructuring actions all geared to facilitate independent management and financial accountability.
Apart from establishing and managing its own rubber estates, BFIDC has responsibility to support development of private and small-holder rubber planting, including supply of inputs and extension. This is another area where the structure and limited autonomy of BFIDC makes it ineffective. Considering the need for efficiency in the rubber plantation and processing industry, the Second Five Year Plan contained a proposal for establishing a fully autonomous Rubber Board in Bangladesh. There has, however, been no action on this suggestion. The present rubber development system, including all elements, needs review and improvement.
BFRI is responsible for all aspects of forestry research covering silviculture, forest management, forest protection, forest products development, environmental conservation and agroforestry. The Institute is headed by a Director who is supported by two Chief Research Officers and Officers in charge of Research Divisions.
BCIC, created in 1972, operates some of the industries abandoned during the liberation war. It also incorporates industries managed earlier by other government corporations. BCIC is by far the largest public sector corporation in Bangladesh and has two ongoing projects and 22 enterprises under its control. It employs about 4,200 managerial and technical staff and about 27,200 workers. It produces fertilizer, pulp paper, basic chemicals, cement, sanitary wares, insulators, glass sheets, rayon/viscose yarn, rayon staple fibre, cellophane, soap and cosmetics. The Corporation, which manages four pulp and papermills, a particleboard mill, a hardboard mill and four match factories, is controlled by the Ministry of Industries.
BCIC's forestry operations are not doing well due to raw material constraints and other reasons. The current accumulated loss of Khulna Newsprint Mill is about Tk 900 million. Other pulp and paper units are also afflicted with problems, particularly related to raw material supply. Unless the raw material issue is solved, it is unrealistic to expect large- scale investment.
