The recent Dhaka café attack has pushed up the cost of doing business for the local apparel makers, even if the sector has so far managed to avoid negative impact on overseas sales, industry insiders have said. They said many garment exporters are now incurring additional costs on account of extra security measures needed to avert any untoward incidents and protect foreign nationals working for the apparel industry. Besides, some apparel exporters have to go abroad for negotiating their business deals with buyers as foreigners are now reluctant to visit Bangladesh in the wake of the recent terror attacks, they said.   “In the aftermath of the Dhaka café attack, we’ve been forced to go for extra security arrangements to protect our business, which has additional costs,” an exporter said. Majority of the factories have already installed closed circuit television (CCTV) cameras to strengthen their protective measures and those who have no such system have started setting up the facility, Md Shahidullah Azim, a former Bangladesh Garment Manufacturers and Exporters Association (BGMEA) leader, said. The additional security measures have increased expenditure, though the amount is negligible compared to export earnings.   Regarding the third country meeting, he said if the meeting is in Asia, at least Tk 0.4 to 0.6 million needs to pay as couple of factory people including the merchandiser have to join the team of business dealings. Another exporter, who visited Italy twice after the attack as buyers were not willing to visit Bangladesh on security grounds, said the foreign tour has not only financial involvement, it has other implications too. Industry people also noted that though some of the exporters still have to go abroad for business negotiation, buyers and retailers and their representatives are coming to the country and the situation is improving. If buyers wish, round-the-clock security is being provided by law enforcement agencies, they added. “Buyers from England visited us in July. We applied for protection from the BGMEA and got it. Buyers were happy, but were overwhelmed by the extent of security that we provided,” Rubana Huq, managing director of Mohammadi Group, said. Bangladesh will continue to be the most efficient and competitive sourcing hub for any importers, she said. Kazi Iftekhar Hossain, president of Bangladesh Garment Buying House Association (BGBA), said he visited India twice after the Gulshan attack for business dealings. Though apparel makers are going the third country, some of them are facing difficulties in getting visas for countries like Hong Kong, he said, demanding further strengthening security with professionally-trained personnel to bring back buyers’ trust. Aminul Islam, secretary general of BGBA, said, “We are now sacrificing one per cent of our three to four per cent business service charge mainly to retain the business.” Foreign buyers are now observing the situation, he said, adding an order worth $3.0 million is yet to be confirmed by a Japanese buyer even after sampling and pricing have been done. But there are exceptions. Abdus Salam Murshedy, managing director of Envoy Group, said some senior representatives from a US buyer visited his factory Monday and they did not want any security. He claimed that the situation is improving. Industry people, however, noted after October they might see the impact of the attack on export earnings, if any. Currently, all the exporters are busy completing their shipment as there will be a week-long Eid holiday next month. Industrial Police (IP) director general Abdus Salam said that the unit is providing full-time security to global buyers during their stay in Bangladesh following requests from the BGMEA and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA). Some of the buyers are getting security from their supplier companies as they are not willing to take police protection, the BGMEA leaders said. The IP provided 15 security escorts between July 21 and August 12 to the foreign buyers, who visited several company offices and factories in Dhaka and Gazipur, while police protection was given to more than 50 buyers in Chittagong. Most of the buyers were from the US, the UK, Italy, Turkey, South Korea, Singapore, Sweden, Russia and Japan. During their visit to the country, the foreign buyers got police protection upon arrival at airport and to hotel, factory visit and during departure from Bangladesh, the police said.

The country’s trade gap with India in the recently concluded fiscal year declined to $4.76 billion from $5.28 billion in FY15 due to rise in export earnings against the fall in import payments. The country’s trade gap with India maintained the declining trend for the second fiscal year in a row as the trade deficit between Bangladesh and India stood at $5.57 billion in FY14. Experts and Bangladesh Bank officials, however, said that the country’s trade gap with India was still high as different non-tariff barriers continued to limit Bangladesh’s exports to the neighboring country. Bangladesh’s imports from India stood at US$ 5.45 billion in the FY16 whereas exports stood at US$ 689.62 million during the financial year. The trade gap in FY15 was US$ 5.28 billion with an export figure of US$ 527.16 million and import of US$ 5.81 billion. Export Promotion Bureau and the BB data showed that Bangladesh’s trade gap with India recorded an all-time high in FY14. A BB official told New Age on Monday that the trade gap with India decreased in the last two fiscal years as the country’s export earnings from the neighboring country slightly increased while import decreased. ‘Businesspeople have recently adopted a ‘wait and see’ approach to their business expansion by opening letters of credit for import due to political uncertainty and delicate situation in law and order. For this reason, imports from India decreased in FY16,’ he said. He said that although the export to India in FY15 increased to $689.62 million from $527.16 million in FY15, the figure was still low compared to at least 10 other export destinations. He, however, said that the trade deficit of Bangladesh against India was still high as different non-tariff barriers continued to limit Bangladesh’s exports to the neighboring country. ‘It is a natural phenomenon that Bangladesh usually faces a deficit with the neighbouring country considering the volume of India’s economy. But it is not acceptable that the size of the deficit has been huge for years,’ he said. He said that the country’s businesspeople mainly imported industrial raw materials and intermediary goods from India. ‘The importers have no option to avoid the imports as such products are not produced in the country. So we have to try to increase the export volume to India to reduce the trade deficit with the neighboring country,’ he said. Policy Research Institute of Bangladesh executive director Ahsan H Mansur told New Age on Monday that the country’s huge trade gap with India was not a matter of concern. He said, ‘We have to import from India or other countries being a developing country. We should keep attention to increase the export earnings from India,’ he said. The country’s export earnings from India have maintained a satisfactory level in the last two fiscal years, he said. He, however, said that the government should take initiative to avoid the non-tariff barriers in different states of India which would boost the export volume of the country further.

US Secretary of State John Kerry yesterday suggested protecting workers’ rights in the garment sector and strengthening workplace safety in Bangladesh. Bangladesh cannot truly meet the aspirations of its people and share prosperity if its workers are not safe and their rights are not ensured,” Kerry said, referring to the collapse of a building in 2013 that housed five garment factories and killed more than 1,100 people in the country’s worst industrial disaster, according to the Associated Press. Kerry said the US has supported Bangladesh’s efforts in increasing safety inspections of garment factories and closing down substandard buildings following the disasters, according to AFP. “But these steps are only part of the story. Enhancing worker safety must be paired with strengthening workers’ rights,” Kerry said in a speech in Dhaka. The top US diplomat said this included allowing workers to form unions and affording them full collective bargaining rights. But labour activists say they still face restrictions in entering the factory premises and the government fails to register the unions, which would give them the legal right to represent workers.Speaking at an event in Dhaka, Kerry assured the union leaders of his government’s support for establishing labour rights and strengthening workplace safety in the sector that earns more than $28 billion a year and employs about 4.4 million workers in 4,000 active factories. Nazma Akter, president of Sammilito Garments Sramik Federation, a rights group, was among the labour leaders who met Kerry.“Kerry wanted to know more from us about labour rights and workplace safety during a five-minute photo session with seven labour leaders,” she said.Bangladesh’s poor labour rights and weak workplace safety measures came to focus after the Tazreen Fashions fire and Rana Plaza building collapse that took the lives of more than 1,200 workers together. Following the Rana Plaza building collapse, the US government suspended Bangladesh’s trade benefit to the US market in June 2013, laying down 16 conditions to be fulfilled by Bangladesh for reinstatement of the GSP. Bangladesh has fulfilled almost all the conditions, like amending the labour law and inspecting garment units by foreign agencies Accord and Alliance to address the structural, fire and electrical flaws in the factories. The commerce ministry submitted a progress report to the US government twice for reinstatement of the GSP, but the Obama administration did not revive duty benefits for Bangladesh, although its third annual review since 2014 went by in June this year. The US government suspended the trade benefits, citing serious shortcomings in workplace safety and poor labour rights in the factories. The US is the single largest export destination for Bangladesh, sending goods worth more than $6.22 billion last fiscal year. Of total exports to the US, 95 percent is apparel items.