Tuesday, 31 January, 2023

BGMEA worried about gas price hike

  • Staff Correspondent
  • 23 January, 2023 12:00 AM
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BGMEA worried about gas price hike

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CHATTOGRAM: Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Faruque Hassan said they are worried as the price of gas for the industry has increased from 14 percent to 179 percent, which will be effective from February 1.

“We are concerned about the gas price hike. We’ll talk to the government in this regard. In the current context, the industry lacks capability to bear this burden of rising costs,” he said.

Faruque made the statements while exchanging views with journalists at a press conference at BGMEA Bhaban in the city on Sunday.

Regarding gas price adjustment, he requested the government to withdraw VAT and tax on import of gas.

He also laid emphasis on reducing ‘system loss’ in gas transmission, cutting off illegal gas and adjusting gas price to overcome the crises.

He called upon the government to determine the rational price of gas and electricity for industry and ensure uninterrupted supply of gas and electricity.

Besides, the government should attach importance on long-term contracts for LNG import, observed the president.

Pointing out that there is an unstable situation in the world economy due to geo-political tensions, he said, “The situation has already left impact on our garment sector. Slowing growth is visible in major markets including the USA and Germany.”

“Importers have reduced orders for garments. We see that they are placing orders in small size instead of placing large orders all at once,” he said.

Faruque said that the buyers are now canceling orders often while many customers are opting for deferred payments. “As far as we know, none of the factories have orders to run the factory at full capacity at this moment.”

The business leader thinks that though the export target was set at $100 billion to be achieved by

 2030, the possibility of growth of the garment market in the current year is thin.

He said, “We are trying to retain the existing market. We are working to diversify the market and products to maintain the continuity of exports even in adverse situations. We are also getting the benefits.”

The apex body’s president claimed that a lot of orders have come to Bangladesh from China in the last few years and the quantity will increase in the next eight years.

“As China is moving away from textiles for environmental reasons, we expect them to come to Bangladesh. We want to take these opportunities. However, in this case, it will be possible to grab the ready market through providing incentives to those who are working with non-cotton or man-made fibers,” he observed.

Consumers in the global market are now opting for non-cotton apparel products due to sustainability. A very promising sector within the textile sector is man-made fiber-based yarns and fabrics, said Faruque.

According to the 2021 statistics of the World Trade Organization (WTO), the share of Bangladesh in the global market is only 6.40 percent. Bangladesh has an opportunity to increase its share further, he said.

“In order to seize this opportunity and sustain the growth of the industry, we have laid emphasis on product diversification, especially non-cotton and market diversification in the apparel sector. We have planned to export garments to all countries of the world by 2030 through increasing productivity,” he added.

BGMEA First Vice President Syed Nazrul Islam, Vice President Shahidullah Azim, Rakibul Alam Chowdhury, Directors Asif Ashraf, Mohiuddin Rubel, Md Hasan (Jacky) and M Ehsanul Haque were present at the press conference, among others.