Considering the ongoing economic crisis and high inflation, apparel industry leaders are now seeking Prime Minister Sheikh Hasina’s intervention to refix the gas price, which was hiked by up to 179 per cent on January 18.
In this regard, leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA) have urged some high-profile individuals, including MPs and leaders of Awami League and major trade bodies, to convince the prime minister to take an immediate step.
Industry insiders said the reasoning behind the gas price hike was not logical and should be reviewed. They said gas and electricity prices should be increased in phases considering the current business situation.
If the prime minister does not take necessary action, they said, the sector will be severely impacted and it will lead to low export earnings, further foreign currency crisis, firing of workers and unrest among workers.
“We had proposed to hike the price to Tk 22 per cubic metre, but the authority went for Tk 30. Considering the real scenario, most of the industry won’t be able to afford this price and go bankrupt eventually,” Sparrow Group Managing Director Shovon Islam told The Business Post.
According to stakeholders, BGMEA sent a letter on January 24 to Tawfiq-e-Elahi Chowdhury, the power and energy adviser to the prime minister, and State Minister for Power, Energy and Mineral Resources Nasrul Hamid.
Apparel leaders also met with Nasrul unofficially and talked with the energy advisers several times in this regard.
In addition, business leaders reached out to the prime minister’s Private Industry and Investment Adviser Salman F Rahman to convince Sheikh Hasina. Several ruling party lawmakers and leaders, who have businesses in the apparel sector, are also trying to convince her.
BKMEA Executive President Mohammad Hatem said, “We are trying to convince the prime minister from different sides. Salman F Rahman is in charge of the issue. We believe we will get a positive result soon.”
On January 26, at a BTMA event, Salman announced that the Prime Minister’s Office has decided to defer the gas price hike till March but they are trying to extend that by another month.
“A formal announcement will be made once a decision is made,” he added.
However, till the writing of this report on Sunday, industry leaders did not get any notification from the respective ministry on the issue.
On January 18, the government hiked retail industrial gas prices to Tk 30 per cubic metre, which will come into effect from February 1.
The rise in gas prices came just six days after the retail price of electricity was raised by 5 per cent.
In June last year, Bangladesh Energy Regulatory Commission raised the average gas prices by 22.78 per cent for retail consumers, except for CNG-run vehicles, in the country with immediate effect.
Industry leaders said they faced a severe gas supply crisis after the government stopped LNG import from the spot market due to high rates. Since then, they have been urging the government to resume LNG import.
If the government can ensure uninterrupted gas supply, they will agree to pay Tk 22 per cubic metre of gas, they said.
Several leaders said that after the gas price hike, they had urged BGMEA, BKMEA and BTMA to organise a joint press conference and place the demand to refix the rate. But the apex bodies did not agree.
“The top leaders think that the government will take it negatively if they will organise such an event. That’s why they are not raising their voice,” an apparel industry leader told The Business Post, requesting anonymity.
However, BGMEA President Faruque Hassan said, “Our proposal is clear. We want the gas price to be refixed based on the average rate of gas from domestic sources, long-term LNG contracts and the spot market. We have written several letters to the authorities and held talks with them.
“I think these are enough to draw the attention of the concerned authority.”
