We want to create these new jobs through business expansion and to boost contributions to the country’s economy. Now we are planning to invest in the fast-moving consumer goods sector. We expect our new products to hit the market by 2024, Mir Group of Companies (MGC) Managing Director Naba E Zaheer told The Business Post’s Rafikul Islam in an exclusive interview
Mir Group of Companies is one of the leading conglomerates in the country. Please tell us about your company and its business.
Our company is actually involved in two main fields—construction and technology. It all started back in 1968 when my late grandfather, Mir Akeb Hossain, founded our parent company, Mir Akhter Hossain Limited. He named it after his brother, Mir Akhter Hossain. Sadly, my grandfather passed away in 1968. After his time, my father, Mir Zaheer Hossain, took the reins of the business. He graduated from BUET (Bangladesh University of Engineering and Technology) in 1969 and, along with my uncle Mir Nasir Hossain, were the driving force of the Group's successes. My father sadly passed away in 2009.
Now, my generation—my brothers, cousins, and I—are gradually being tasked with continuing the legacy. My brothers Shama-e Zaheer and Fida-E Zaheer are the chairman and vice-chairman of Mir Group.
I joined the family business in 2014, fresh out of Canada’s York University with a degree in Business. Our focus spans a range of sectors: cement, ready-mix concrete, concrete block, real estate, and IT.
You are engaged in the business of cement, real estate, concrete products, and IT industry. What challenges do you face in a diverse industry?
Navigating such a diverse industry definitely comes with its share of challenges. We've deliberately honed in on the areas where we excel and have a strong foundation. That means we’re always working on enhancing our Construction and IT-related ventures. Looking ahead, we plan to broaden our business horizons even further. At present, some of our main hurdles include the complexities of securing Letters of Credit (LCs) for importing crucial raw materials, concerns about the Taka's value relative to the dollar due to geopolitical events like the Ukraine conflict, and ensuring a consistent power supply.
What are the prospects in the IT sector building Smart Bangladesh?
Our honourable Prime Minister has set forth a vision of establishing a Smart Bangladesh. I see a technological revolution on the horizon for our country in the next couple of decades. While we've been through an industrial revolution for over a decade, it's now the era of technological advancement.
This vision perfectly aligns with our country's trajectory, especially since we're witnessing a surge in young talent entering the workforce. These young minds are incredibly adept at embracing new technologies. We can seamlessly integrate technology across all sectors, and our vibrant young population is at the forefront of it all. But it’s important to provide them with the right training and education. This calls for collaboration between the public and private sectors. By investing in education, Bangladesh can tap into the global business process outsourcing market and offer better job opportunities abroad, ultimately boosting income and remittances.
You are involved with ready-mix concrete business. Tell us about the potentiality of the ready-mix concrete sector in the country.
We launched Mir Concrete Products Limited back in 2004, and it was all about creating more efficient and sustainable construction practices while reducing our environmental impact.
Even during the pandemic chaos, our ready-mix concrete industry kept growing when many others were struggling. People want to wrap up construction projects quickly and smoothly these days. It’s a time and cost-saving choice that also helps shrink our carbon footprint. Using our concrete products during construction actually helps reduce air pollutants like dust and noise, which is a pertinent problem with traditional methods. We have noticed a rapid shift away from conventional manual construction practices, even in rural areas.
The price of rod crossed Tk1 lakh per ton in the retail market which was the highest in the country. Please tell us how it might impact the real-estate sector?
The surge in the prices of construction materials, especially steel rods, has hit the real estate sector hard. It's not just the real estate companies; everyone involved in construction is feeling the pinch.
Apartment prices have shot up by around 25% to 30%, owing to the skyrocketing costs of construction materials and other expenses.
Many developers started their projects in the past three years, calculating their costs based on the prices back then. So, even before the foundation was laid, lots of apartments were already sold. That means some projects are grappling with losses they didn’t anticipate.
Your company is producing cement. What sets you apart from other companies?
We've got quite a unique angle as a construction-centric company. Being a construction company involved with large government projects, we are one of the biggest users of cement in the country. It's the lifeblood of our industry. We rely on our own products for some of the most critical infrastructure projects. So, when it comes to quality, we're absolutely unwavering. We're not in the business of compromising; we're all about maintaining and ensuring top-notch quality.
Do you face any problem importing raw materials now that LC opening is very difficult?
The opening of letters of credit (LCs) is very challenging now due to dollar crisis created by the Russia-Ukraine war. We have to repeatedly request our banks to open LCs for us when we import different types of raw materials to produce cement and concrete. It is a challenge now to operate at capacity.
As an entrepreneur what’s your suggestion to ensure the ease of doing business in the country and bring more investments in the private sector?
Our country’s business and investment environment is easier and more accessible than most countries. In the long run, we also have a robust and growing economy with a huge population that is easily accessible due to size of our country. To save time and attract more foreign direct investments, our land registration and various permission processes should be fully digitised. Regulatory uncertainties will need to be streamlined as well as speeding up the litigation process.
Besides, honest tax payers should be valued and incentivised with added benefits.
Do you seek any government policy support?
Considering the current business situation, the government should lower import tariffs for the cement industry. A flat VAT rate should be fixed here. Besides, customs duty should be slashed on import aggregates as it is essential to our development and impacts the cost of construction. AIT for manufacturers of ready-mix concrete should be reduced from 7 percent to a net 2 percent. The energy rate should be logical and based on global market prices as it pushes up production costs.
If tariffs and taxes are reduced, public spending will increase, resulting in a boost in economic activity. This will actually increase tax revenue collection by sheer volume. The tax rates right now are at the inflection point of diminishing returns, where more tariffs will result in lower total revenue collection.
What’s your future plan and vision for your company?
We want to expand our current business and increase our business portfolio. Our next plan is to invest in commodities and FMCG particularly food and food products. In 2024, we will start investing and going to market.
