Strong local currency, higher fuel prices and lower port efficiency are the main hurdles that put the country’s readymade garment industry on the back foot in competing with its foreign rivals, which have their own fabrics, capital machinery, low cost fuel and competitive foreign currencies.Bangladesh taka remains strong as the central bank often interfere in the market releasing millions of US dollars whenever taka features depreciations in the local currency market as a result taka remains strong artificially.A strong taka discourages export growth in Bangladesh and the exporters face pressure both locally and in the international market in prices.The Bangladesh Bank, the central bank of the government interferes in the currency market to keep taka stable against the dollar, said Shahid Ul Islam a former Vice President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).While talking to The daily Observer on the prospect of hitting $50 billion export target selling readymade garments by 2021, he said if the The stronger local currency, high fuel prices, and lower international; prices for the garment products exist it will be very tough to reach the target within the stipulated period of 2021.He said the rigid stance of the government for keeping taka strong against the greenback will restrict growth of export earnings. The Finance Minister AMA Muhith recently turned down a proposal to withdraw interference in the currency market so that taka takes its value in terms of market transaction.He said: “Such stance would discourage exports and hinder the plan to achieve the target of $50 billion from garment export.” of devaluation of taka against US dollar and even said the government has no plan to change the current currency policy,”Islam also the Managing Director of the Rupa Group quoting a BGMEA leader who recently led a representation to the Finance Minister said, “Our members visited the finance minister few days back but he was negative on this regards.”He said exporters have long been lobbying for a cheaper currency to promote and boost export.The former BGMEA leader said the government has repeatedly increased natural gas prices which have led to higher costs for the country’s $29 billion garment export industry.He said, “We are in pressure to maintain compliances as per Accord and Alliance, the clubs of European and the Central American buyers respectively.”Moreover the extra fuel costs amid global competitive cheaper market have intensified the challenge to survive.He said at present the demand in the international market is low and the prices of readymade garments are decreasing day by day and it will more alarming as local garment producers are compelled to reduce their products due to high fuel of fuel and other utilities.He said the government’s plan for importing LNG from next year will also increase costs of doing business as it has already been declared that LNG prices will higher but will be available.Islam said export is continuously declining and it is a necessity to give some incentive to the exporters though devaluating currency which other countries are doing for their exporters.
