Friday, 29 October, 2021

BGMEA seeks import of raw materials thru’ all landports

  • Staff Correspondent
  • 16 August, 2021 12:00 AM
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BGMEA seeks import of raw materials thru’ all landports

Apparel makers have requested the commerce ministry to open the import of garment raw materials under bond facility through different landports.

Currently, the manufacturers can import cotton, yarn, fabric and other raw materials through Benapole land port only.

Allowing the use of other land ports too, especially Bhomra and Sona Masjid, for the purpose would ease the import-export congestion, they said.

Bangladesh Garments Manufacturers and Exporters Association (BGMEA) wrote a letter to Commerce Minister TipuMunshi in this regard on Saturday.

The trade body also sought partial shipment of garment and textile raw materials at all the landports - a facility which is now restricted, even in the case of Benapolelandport.

The partial import of raw materials is now only allowed in Chittagong port only. 

“The apparel industry cannot maintain its competitiveness because of a large gap between local and international price of yarn despite ample supply of cotton in global market,” BGMEA president Faruque Hassan said in the letter. 

Nearly the country’s whole demand of yarn is met by the Indian yarn imported through Benapole port. 

The congestion at the port coupled with deferred and discount payment, finished product transportation problems are causing huge loss to local garment manufacturers.

They are also being subjected to forced loans for payment of liabilities of back to back LC, the BGMEA says.

It suggested the government to increase goods storage capacity as well as manpower at all the landports to remove goods congestion problem and infrastructural bottlenecks.

The steps are expected to improve the export-oriented garment’s capacity and competitiveness which will eventually help the industry make a turnaround amid the pandemic

The steps will help lower burden on the country’s largest landport while bringing momentum to import and export and curtailing cost and time, according to the BGMEA.

The apex body of apparel makers says their price competitiveness and product quality will also improve with the suggested moves arguing that export-import problem is largely blamed for the huge yarn price gap between local and international suppliers.  The lion’s share of garment raw materials comes from China and India. So, any disruption in the supply chain causes huge problems for the industry. The suggestions will also help lower such supply risks.

Confining to a lone port despite having many ports and not allowing partial shipment through the ports put negative impacts on the country’s overall competiveness, the apparel makers say.

Besidethe raw material collection from local sources, BGMEA also demanded the government keep the option of collecting raw materials from global sources, which it says will help double the Bangladeshi apparel’s global share from the existing 6.8 percent.

The country’s garment sector is passing through a tough time after corona induced order cancellation, bankruptcy of some buyers, discount and deferred payment and freight transportation problem.

As a result, shipment cost of Bangladesh apparels to key export destinations like the USA and Europe has increased by 100 to 300 percent in last two years.

Besides, production cost of local garment manufacturers has increased by 30.10 percent in the last eight years because of increased wage, and rise in electricity, gas, bank and freight charges, BGMEA claims.

On the other hand, the industry faced a price fall by 3.7 percent in the last fiscal year. Immediately after corona onslaught, it faced order cancellation of some $3.18 billion—a large portion of which returned later.