Thursday, 7 July, 2022

Plastic industry leaders seek bonded warehouse

  • Staff Correspondent
  • 10 April, 2022 12:00 AM
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Plastic industry leaders seek bonded warehouse

Business leaders and policy makers both emphasised the need to ease duty structure of plastic raw materials import, modernise related policies, encourage use of bio-plastic and sign FTA or PTA with potential countries.

They also called for increasing negotiation skills, protecting domestic market, product diversification and development of plastic waste management system.

The remarks came at a webinar on “Sustainable export growth in post-LDC world: strategies for the plastic sector” organised by Dhaka Chamber of Commerce and Industry (DCCI) in Dhaka on Saturday.

The speakers discussed technological advancement, enhancing accredited world class testing lab facilities, innovative product designing and ensuring business friendly environment to attract foreign direct investment (FDI).

Central bonded warehouse facility, tax incentives, coordination among government agencies, easy access to finance and investment on research and development are the other priority areas for plastic sector, they said.

Principal Secretary to Prime Minister Dr Ahmad Kaikaus joined the webinar as the chief guest and FBCCI President Md. Jashim Uddin joined the event as special guest withDCCI President Rizwan Rahman in the chair.

Shamim Ahmed, President of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA), presented the keynote paper.

Dr. Kaikaus said: “The existing nexus between the public and private sector is stronger than ever, that leads Bangladesh to a new height.”

In order to identify various prospects and challenges in the plastic sector, he suggested forming a national taskforce combining public and private sector participation.

He stressed the need for a better plastic waste management solution.

 “We should have our own certification agency and for establishing that PPP model can be the best option. For certification, we are now spending a lot of money,” he said.

DCCI President said around 5,110 companies are operational in plastic sector and 98 percent of them are SMEs.

To ensure sustainable industrial growth, a draft Plastic Policy was developed by the government, he said, adding that since many preferences will not exist in post-LDC era, FTA and RTAs can be signed with the potential countries.

He said an enabling tariff regime is needed to support raw material import during the post-LDC time.

DCCI chief said, “We need to replicate the RMG success model to other export-led manufacturing sectors as well. Product diversification is essential while changing raw materials to recycled plastic waste as viable alternative.”

FBCCI president said that despite the fact there are many challenges, the entrepreneurs of this sector are “very resilient to overcome these.”

 “We need world class accredited testing lab, proper policy support with intellectual property rights (IPR) policy and innovation in design and development,” he emphasised.

He also called upon declaring the plastic sector as a “green industry.”

In order to facilitate 100 percent recycling, he suggested an extensive collection mechanism or system under the guidance of city corporations.

MdJashim Uddin also demanded for an equal corporate tax rate for all exporters which is currently 30 percent for the plastic industry.

“We need to expand backward linkage and sub-contracting industry in this sector so that small producers can grow and able to provide thousands of components to the large industries,” FBCCI chief said.

In keynote speech, Shamim Ahmed highlighted that in FY2020-21 total export of plastic sector including direct and deemed was more than $1 billion.

The domestic market size of this sector is $3 billion and the sector itself creates 1.5 million employments, he said.

Plastic is the 8th largest export earning sector (including direct and deemed export) in Bangladesh which has been expanding 4.5 percent per annum.

He termed access to finance, central bonded warehouse, skilled workforce, credible testing facility, diversity and plastic waste management are some of the major challenges of this sector.

In the post-LDC period, the sector will lose competitiveness, duty free market access, subsidy or incentives and will have to follow stringent compliances, he said.

He recommended reforming import-export policies highlighting the needs of LDC graduation and stressed the need to attract foreign investors. Shamim Ahmed called for withdrawing 5 percent supplementary duty on plastic sector.

Dr. Md. Shahidul Islam, Member (Customs) at NBR,emphasised re-using single-used plastic items to reduce pollution and costing.

 “If we cut down the lengthy customs procedures at the time of import at the port, it will ensure ease of doing business and cost minimisation,” he said.

Ahsan Khan Chowdhury, CEO of PRAN RFL Group, said,“At present our recycling capacity is growing at a faster pace and plastic products are being exported to Germany, Australia and USA. But we should work on reducing freight charge or shipping cost to be more competitive.”

He urged the government to slash duty on import of plastic raw materials to help increase export.

Dr. Ijaz Hossain, Retired Professor of Chemical Engineering, BUET underscored the need to plastic waste management, recycling and re-use in the sector.