Abu Sazzad :
The Bangladesh Garment Manufacturers and Exporters’ Association (BGMEA) President Md Siddiqur Rahman has underscored the need for approving a 10-year loan rescheduling facilities for the politically victimized RMG industry.
Experts of the banking sector have expressed their concern to the BGMEA leader, but the central bank is not approving the proposal, claimed the BGMEA President.
“We will meet the policy makers as soon as possible to resolve the issue, so that the victimized factories can operate their business smmothly”, said Md Siddiqur Rahman.
The RMG sector has faced challenges from January to March this year due to political unrest that interrupted improvement of the sector, he also claimed.
According to figures of the Export Promotion Bureau (EPB), in 1983-84, RMG exports contributed 3.89 per cent of the country’s total exports. It was 79.61 per cent in 2012-13 and 81.16 per cent in 2013-14. Bangladesh earns $ 24.50 billion which covers about 18 per cent of the GDP.
Supply of raw materials and accessories and transportation were affected due to the blockade in the first quarter of this year. As a result, the garment manufacturers could not finish products on time and a good number of factory owners have missed their shipment.
About the buyers’ visit to Bangladesh, Siddiqur Rahman said, they did not cancel their visit, it was only postponed on security grounds. “There is no security problem now in Bangladesh and the law and order situation is quite under control,” he added.
To a question, Siddiqur Rahman said, there is international pressure on the RMG sector, like devaluation of the dollar in the international market and various agreements that hamper improvement of the apparel sector.
About assistance from the government, he said the garment sector expects only infrastructure and policy support. About low prices offered by buyers, he said, sometimes they fail to understand that prices of readymade garments of Bangladesh are much lower compared to other competitors. This is unethical, he calimed.
The BGMEA leader also urged the government to provide gas connection on a priority basis for industries that are ready to begin production.
Commenting on the Trans-Pacific Partnership Agreement, Siddiqur Rahman said, it was the US government’s decision and Bangladesh should adopt a diplomatic strategy while dealing with it.
Infrastructure development is the main challenge for the country’s readymade garment exporters for reaching $50 billion export by 2021, said Mostafa Golam Quddus, Former President of the BGMEA.
He said, lack of productivity and efficiency, shortage of skilled manpower, scarcity of land and high interest rate of bank loan are the challenges for reaching the target.
Moreover, gas and electricity connection is also one of the major hindrances for running the operation of many factories. More than, 250 factories have been shut down due to insufficient gas and electricity connection, and the investment over Tk 12,000 crore were wasted in those factories.
“We are very worried for the newly shifted garment factories because these factories are not getting sufficient gas and electricity connection to start its production”, he said.
The manufacturing sector has the rivals’ country like India, China and Vietnam to grab the international market, but the sector has all potentiality to overcome the situation, he explained. “We are not worried about our rival countries because we are getting comparatively low cost labour which is an extra advantage for the sector”, he said.
The entrepreneurs of Bangladesh had been facing severe competition in the international market due to high service charge and interest on bank loan. ‘Our entrepreneurs are paying 13-16 per cent interest on bank loans which is higher than that of our competitor countries,’ he said. Although recently, commercials banks have cut their lending rate, but it is still high against the demand, said Mostafa Golam Quddus.
‘To achieve the target of $50 billion export earnings from the RMG by 2021 the Bangladesh government will have to make sure investment in developing infrastructure’, said Exporters Association of Bangladesh (EAB) President Abdus Salam Murshedy.
He demanded withdrawal of the tax at source imposed on the manufacturing sector in the proposed national budget for the fiscal 2015-16.
“It will hinder the natural growth of the country’s readymade sector”, said EAB President. Justifying his demand for withdrawal of the increased tax at source, Salam Murshedy said, the readymade garment sector is passing through a transformation as various reforms are being taken in the sector following fire at Tazreen Fashions and the Rana Plaza collapse for which entrepreneurs are investing crores of taka.
The EAB president said, one per cent export duty imposed on capital machineries will discourage businessmen. The decisions of imposing or increasing new taxes will contradict with the projected seven per cent GDP growth and the export target. He further demanded to create a fund of Tk 100 crore with a view to developing the skill of manpower in the name of ‘National Human Resource Development Fund’.
The Bangladesh Garment Manufacturers and Exporters’ Association (BGMEA) President Md Siddiqur Rahman has underscored the need for approving a 10-year loan rescheduling facilities for the politically victimized RMG industry.
Experts of the banking sector have expressed their concern to the BGMEA leader, but the central bank is not approving the proposal, claimed the BGMEA President.
“We will meet the policy makers as soon as possible to resolve the issue, so that the victimized factories can operate their business smmothly”, said Md Siddiqur Rahman.
The RMG sector has faced challenges from January to March this year due to political unrest that interrupted improvement of the sector, he also claimed.
According to figures of the Export Promotion Bureau (EPB), in 1983-84, RMG exports contributed 3.89 per cent of the country’s total exports. It was 79.61 per cent in 2012-13 and 81.16 per cent in 2013-14. Bangladesh earns $ 24.50 billion which covers about 18 per cent of the GDP.
Supply of raw materials and accessories and transportation were affected due to the blockade in the first quarter of this year. As a result, the garment manufacturers could not finish products on time and a good number of factory owners have missed their shipment.
About the buyers’ visit to Bangladesh, Siddiqur Rahman said, they did not cancel their visit, it was only postponed on security grounds. “There is no security problem now in Bangladesh and the law and order situation is quite under control,” he added.
To a question, Siddiqur Rahman said, there is international pressure on the RMG sector, like devaluation of the dollar in the international market and various agreements that hamper improvement of the apparel sector.
About assistance from the government, he said the garment sector expects only infrastructure and policy support. About low prices offered by buyers, he said, sometimes they fail to understand that prices of readymade garments of Bangladesh are much lower compared to other competitors. This is unethical, he calimed.
The BGMEA leader also urged the government to provide gas connection on a priority basis for industries that are ready to begin production.
Commenting on the Trans-Pacific Partnership Agreement, Siddiqur Rahman said, it was the US government’s decision and Bangladesh should adopt a diplomatic strategy while dealing with it.
Infrastructure development is the main challenge for the country’s readymade garment exporters for reaching $50 billion export by 2021, said Mostafa Golam Quddus, Former President of the BGMEA.
He said, lack of productivity and efficiency, shortage of skilled manpower, scarcity of land and high interest rate of bank loan are the challenges for reaching the target.
Moreover, gas and electricity connection is also one of the major hindrances for running the operation of many factories. More than, 250 factories have been shut down due to insufficient gas and electricity connection, and the investment over Tk 12,000 crore were wasted in those factories.
“We are very worried for the newly shifted garment factories because these factories are not getting sufficient gas and electricity connection to start its production”, he said.
The manufacturing sector has the rivals’ country like India, China and Vietnam to grab the international market, but the sector has all potentiality to overcome the situation, he explained. “We are not worried about our rival countries because we are getting comparatively low cost labour which is an extra advantage for the sector”, he said.
The entrepreneurs of Bangladesh had been facing severe competition in the international market due to high service charge and interest on bank loan. ‘Our entrepreneurs are paying 13-16 per cent interest on bank loans which is higher than that of our competitor countries,’ he said. Although recently, commercials banks have cut their lending rate, but it is still high against the demand, said Mostafa Golam Quddus.
‘To achieve the target of $50 billion export earnings from the RMG by 2021 the Bangladesh government will have to make sure investment in developing infrastructure’, said Exporters Association of Bangladesh (EAB) President Abdus Salam Murshedy.
He demanded withdrawal of the tax at source imposed on the manufacturing sector in the proposed national budget for the fiscal 2015-16.
“It will hinder the natural growth of the country’s readymade sector”, said EAB President. Justifying his demand for withdrawal of the increased tax at source, Salam Murshedy said, the readymade garment sector is passing through a transformation as various reforms are being taken in the sector following fire at Tazreen Fashions and the Rana Plaza collapse for which entrepreneurs are investing crores of taka.
The EAB president said, one per cent export duty imposed on capital machineries will discourage businessmen. The decisions of imposing or increasing new taxes will contradict with the projected seven per cent GDP growth and the export target. He further demanded to create a fund of Tk 100 crore with a view to developing the skill of manpower in the name of ‘National Human Resource Development Fund’.
