Garment exporters yesterday submitted a proposal to the Indian High Commission in Dhaka, seeking 50 acres of land in Gujarat to build a warehouse from which apparel items can be shipped directly to retail shops across India. Indian authorities had earlier agreed to provide the land and asked Bangladesh Garment Manufacturers and Exporters Association to submit a detailed proposal. A BGMEA team led by its President Atiqul Islam first placed the demand to Indian Prime Minister Narendra Modi during his recent visit to Dhaka. Modi discussed the matter with his policymakers upon returning to New Delhi and decided to provide the land to the BGMEA. The move is expected to help Bangladesh’s garment makers meet their target of exporting $1 billion worth of products to the neighbouring country in the next three years. Islam handed over the proposal to Indian High Commissioner Pankaj Saran. Islam in the proposal said the land will be procured in the name of a company formed by BGMEA and Bangladesh Knitwear Manufacturers and Exporters Association and others to set up a warehouse and distribution centre primarily for garment products. “We want to invest around $25 million in India for setting up the warehouse and distribution centre,” he said, adding that they plan to establish around 1,000 retail stores in various cities of India to display and sell their products. Islam also said they are hopeful the Bangladesh government will allow them to purchase land in India to set up the warehouse.

The garment sector is set to miss its export target this fiscal year after the three-month political turmoil hampered shipments. Between July last year and May this year, garment exports raked in $22.92 billion, which is up 5.51 percent year-on-year but below the periodic target of $24.26 billion, according to data from the Export Promotion Bureau. Now, to meet the yearly target of $26.9 billion, some $3.98 billion has to be earned this month, the closing month of fiscal 2014-15. Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association, placed the blame on the political crisis. The garment exporters could hardly send their shipments for three months from January to March, he said. The strong performance by some competing countries such as India, Vietnam and Pakistan is another major reason for the fall, he added. The average export growth of the three countries is nearly 10 percent. Islam also identified some short-term challenges, including lower productivity by workers, higher cost of production and a steep fall of two major currencies — the dollar and the euro — against the taka. “It’s time to find out the root cause of our problems for the sustainability of the garment business and to achieve our $50 billion target by the end of 2021.” The long-term challenge for the garment sector is the Trans-Pacific Partnership (TPP), a trade agreement between Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam and the US. The agreement is expected to take effect soon. If the TPP is signed, Vietnam will enjoy duty benefits to the US and other prominent markets, another threat for the Bangladeshi garment items, he said. Ahsan H Mansur, executive director of Policy Research Institute, said a lack of new investment for expansion purposes set the sector back.

After India, Bangladesh is now planning to form an alliance with China to tap the marine resources in the Bay of Bengal. “We received a Chinese proposal on Wednesday to forge an alliance on blue economy,” a senior Foreign Ministry official said, seeking anonymity. Bangladesh and India signed a memorandum of understanding on blue economy and maritime cooperation in the Bay of Bengal and the Indian Ocean on June 6 in the presence of Prime Minister Sheikh Hasina and her Indian counterpart Narendra Modi. “We are now scrutinising the proposal and hope to come to a conclusion as soon as possible,” the official said. Bangladesh also wants to form a bloc comprising regional littoral states to cooperate in the field of blue economy. These states are Bangladesh, India, Thailand, Myanmar, Sri Lanka, Maldives, Indonesia and Malaysia. The MoU is mainly on skill development, capacity building, pollution response, tsunami and cyclone warning and fishing among other things. “We incorporated the harmless issues and dropped the thorny or sensitive issue such as security,” said another Foreign Ministry official. Bangladesh does not have much knowledge about marine bio-technology unlike India who has advanced knowledge in this field, and Dhaka can benefit from sharing, he said. Medicines such as cod liver oil, cosmetics and toiletries can be produced with marine resources but Bangladesh lacks investment in the sector. Fishing is another area where both Bangladesh and India can cooperate as the former lacks deep sea fishing capacities, the official said. “Bangladesh has sovereign right to fish in up to 200 nautical miles but the vessels can go up to only 40 nautical miles,” he said. The deep sea has massive untapped fishing resources but Bangladesh has been unable to tap it, he said. The joint statement issued during Narendra Modi’s visit to Dhaka said that the two prime ministers had expressed satisfaction at the amicable settlement of the maritime boundary issue. “To harness the vast economic opportunities this has opened up, they agreed to work closely on the development of ocean-based Blue Economy and maritime cooperation in the Bay of Bengal and chart out the ways for future cooperation,” the statement said. About the deal with China on marine cooperation, the official said it would be like what Bangladesh has with India. “We will cooperation in the harmless areas like what we have with India while security and other thorny issues will not be included in the deal with China,” he added. Bangladesh settled maritime boundary disputes with India in 2014 and with Myanmar in 2012. Bangladesh now has sovereign authority over a 118,000 sq-km area in the Bay.

Country’s exports to most of the non-traditional markets witnessed a healthy growth in the July-May period of the current financial year 2014-15 but Turkey and South Korea remained blemishes during the period. Exporters said earnings from the Turkey market dropped due to imposition of safeguard duties on the readymade garment imports and devaluation of the euro and the Turkish currency lira while earnings from South Korea decreased due to a fall in export of leather and leather products. On the other hand, export earnings from Australia, China, India and Japan witnessed significant increases. Export earnings from the Turkey market dropped by 17.53 per cent to $653.73 million in 11 months of the current fiscal year from $792.77 million in the same period of the FY 2013-14. Export earnings from Australia in the July-May period of the FY15 increased by 25.39 per cent to $547.38 million from $436.69 million in the same period of the FY14, data showed. ‘It’s a good sign for the country’s RMG sector that the earnings from the non-traditional markets have been increasing gradually,’ a former vice-president of the Bangladesh Knitwear Manufacturers and Exporters Association, Mohammad Hatem, told New Age. He said the export to Australia increased in the recent months as the country shifted its procurement from China to Bangladesh. ‘Export earnings from Australia witnessed a significant growth in 11 months of the FY15 riding mainly on the earnings from knitwear products. Not only Australia but also New Zealand raised its procurement from Bangladesh as China shifted their production to high-end products from basic items,’ Hatem said. RMG export to Australia in 11 months of the FY15 increased by 22.80 per cent to $481.58 million from $392.17 million in the same period of the FY14, the EPB data showed. Hatem also said the earnings from Turkey dropped due mainly to the imposition of safeguard duty on importing RMG from Bangladesh as well as a depreciation of the euro. The payments between Bangladesh and Turkey are settled in the euro, Hatem added. According to the EPB data, the export of RMG to Turkey in 11 months of the financial year 2014-15 decreased by 23.88 per cent to $438.69 million against $576.34 million in the same period of the FY 2013-14. Export to China increased by 6.40 per cent to $720.01 million in the July-May period of the FY15 against $676.68 million in the same period of the FY14. RMG export to China increased by 26.42 per cent to $265.71 million. Export to India in the July-may period of the FY15 increased by 18.97 per cent to $472.12 million from $396.82 million in the same period of the FY14. RMG export to India increased by 11.80 per cent to $94.45 million in the period. Export earnings from Japan in 11 months in the FY15 grew by 6.20 per cent to $838.34 million from $789.38 million in the same period of the FY14. RMG export to Japan grew by 14.58 per cent to $594.81 million in the period, the EPB data showed. Exporters hoped that the export to Japan would increase more and the market might be the next one-billion-dollar market for Bangladesh as the country (Japan) relaxed rules of origins on knit articles from two stages to one stage. The EPB data showed that export to South Korea in 11 months of the FY15 decreased by 23.78 per cent to $244.12 million from $320.28 million in the same period of previous financial year. Leather export to South Korea in the 11 months dropped by 49.31 per cent to $51.86 million from $102.31 million in the same period of the FY14.

The finance minister, while proposing FY 2015-16 budget before the parliament, proposed to raise  tax at source on export proceeds of readymade garments (RMG) to one per cent from existing 0.30 per cent. He described this as the final tax liability for the sector. One day later, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and the Bangladesh Textile Mills Association (BTMA) demanded withdrawal of increased tax at source from export prices of RMG to achieve middle- income status in 2021. The hike in tax at source will cause loss of competitiveness of the country’s readymade garment sector. At the same time, RMG exporters feel the GSP plus status for Pakistan and Trans-Pacific Partnership agreement among Vietnam, Taiwan, Philippines, the US, Canada, Japan and Australia have created more challenges for Bangladesh’s RMG exporters. The proposed tax hike at source on exports is completely illogical and it would affect the future of readymade garment sector, according to the  president of the BGMEA at a press conference on the proposed budget. The proposed budget is business-friendly but not textile-friendly, said Atiqul Islam on behalf of the trade bodies. He also said that the textile and garment sector would be the worst victim of the proposed budget and the proposal for raising tax at source would hinder the normal growth of the sector. According to the president of the BGMEA, the cost of production increased by 10 per cent in 2015 from 2013 as expenditure on account of workers’ wages rose by 15 per cent during the period. Under the circumstances, the proposed tax rise at source would damage the competitiveness of the sector. At the same time, the deprecation of Euro, Canadian dollar and Russian rouble against US dollar has created another challenge for the sector. Moreover, the Centre for Policy Dialogue (CPD) has found that the apparel sector suffered the highest loss of Tk 13.18 billion in first three months of this year. On the other hand, the commerce minister formally announced the target for yearly RMG turnover. He has already set the initial target $33.56 billion for FY2015-2016 with a growth of 7.49 per cent on the basis of data from the Export Promotion Bureau and considering global and local economic situations. It is to be noted that in the outgoing FY2014-2015, the target was $33.2 billion. The largest export earner of the country already has failed to reach the target. As per the latest EPB data, during July-April of the FY2014-15, Bangladesh earned $25.30 billion from exports while the country’s income source tax was .03 per cent. As per the EPB data, the woven sector earned $10.55 billion with still 4.53 per cent short of the target and the knitwear fetched over $10 billion which was also 6.3 per cent less than the target. At this time, the RMG sector is facing a lot of challenges including image crisis caused by the political turmoil that occurred in first three months of the current year. It is true that textiles and garments industry were enjoying various incentives but the sector also gave a lot to the economy. Meanwhile, BKMEA president AKM Salim Osman said the proposed tax hike at source on exports will be dangerous for the sector. “We have to keep in mind that the whole nation as well as the government is dependent on textile and garment sector.” He added that there is no country in the world where buyers and brand groups (Alliance and Accord) are working to make the factories compliant. In the meantime, the CPD also suggested that the government should provide incentives to the affected sectors in the budget. Presently, garment exports to the US market are struggling, while shipment to the EU market is facing greater competition. The country’s entrepreneurs and 4.6 million workers are grateful to the government for giving various incentives from 1980 but it is true that Bangladesh is known to the world because of its textile and garment sectors. Amid competition the hike in tax at source will hamper the growth of the RMG sector. Such a decision will put the country’s major foreign currency earning sectors in great trouble. If the government gives policy support to RMG, the sector will make it possible to give the nation US$ 50 billion export along with generating additional 6.5 million jobs in 2021.

Bangladesh has proposed export of its jute bags, textiles, pharmaceuticals and ceramics to Cambodia. The proposal was made by the newly-appointed Bangladesh Ambassador to Thailand with concurrent accreditation to Cambodia, Saida Muna Tasneem, when she called on Commerce Minister of Cambodia Sun Chanthol on Wednesday.    It was agreed that the Commerce Ministers of the two countries would meet at a mutually convenient time for the first Joint Trade Committee. Earlier in the day Bangladesh Ambassador to Thailand with concurrent accreditation to Cambodia presented her credentials to His Majesty King Norodom Sihamoni of Cambodia at the Royal Palace in Phnom Penh. At an official ceremony Ambassador Tasneem presented her Letter of Credence accredited by the President of Bangladesh to the King of Cambodia. Senior Minister for the King’s Palace, Deputy Prime Minister of Cambodia and Chief of Protocol and high officials were present at the credential ceremony. The Ambassador conveyed to King Sihamoni, son of late King Norodom Sihanouk, greetings and good wishes of President Md Abdul Hamid and Prime Minister Sheikh Hasina.

Africa’s textile and apparel exports to the United States could quadruple to $4 billion over the next decade through an extended duty-free trade treaty, a US official said on Wednesday.The trade program known as the African Growth and Opportunities Act (AGOA), currently before American lawmakers, provides eligible sub-Saharan countries duty-free access to the world’s top apparel market, giving Africa a competitive edge over suppliers such as Bangladesh and Vietnam.The US administration has already called for Congress to renew the program well ahead of its expiry date of Sept. 30, 2015. The program, in which about 40 African countries are eligible to take part, could be extended another 10 years.”Ten years is a game-changer,” said Gail Strickler, assistant United States trade representative for textiles and apparel, adding the extension could be passed “imminently”.”Africa should be able to quadruple its exports, literally without a lot of trouble, creating another 500,000 new jobs.”Established in 2000, AGOA has already been renewed past its original 2008 expiry date.Last year, US clothing imports from sub-Saharan countries reached $986 million, up nearly six percent from 2013, as countries such as Lesotho, Kenya, Ethiopia and Tanzania participated in the program.Analysts said Africa had lower labour costs and abundant raw materials, such as top-quality cotton from Uganda, but congested ports, a poor road network, lack of skills and old technology were a hindrance.While the costs may be rising in Asia, they are still way more competitive than Africa, especially on productivity, quality and product range,” said Joseph Nyagari, an official at the Nairobi-based African Cotton and Textile Industries Federation.African officials and Asian firms with factories in Africa welcomed AGOA’s extension, saying investment would follow.Kelebone Leisanyane, chief executive of the Lesotho National Development Corporation, said the land-locked southern African nation, a top exporter under AGOA, plans two new fabric mills.”I think for Lesotho AGOA is critical and its renewal means the survival of many families, with around 35,000 workers in the apparel and textile industry,” he told Reuters.Taiwanese firm New Wide Garment, which has six factories in Kenya and one each in Lesotho and Ethiopia, also aims to expand.”Now with a ten-year extension it means most of the investors will jump into Africa. We intend expanding more in Africa,” Heman Boodia, its Africa vice president told Reuters.

India will provide 50 acres of land in Gujarat to Bangladeshi businessmen to build a warehouse from which apparel items can be shipped directly to retail shops across India.

The development comes after a team of Bangladesh Garment Manufacturers and Exporters Association led by its President Atiqul Islam placed the demand to Indian Prime Minister Narendra Modi during his recent visit to Dhaka.

Modi discussed the matter with his policymakers upon returning to New Delhi and decided to provide the land.

The move will help garment makers meet their target of exporting $1 billion worth of products to India in the next three years.

The deputy Indian high commissioner in Dhaka has now sought a proposal from the BGMEA.

Islam said the proposal will be submitted to the Indian high commissioner on Sunday.

Bangladesh is one of the ‘worst’ places in the world to work, where workers’ rights are not guaranteed, according to a global survey.

The International Trade Union Confederation (ITUC), in a survey launched on Wednesday, ranks Bangladesh, along with 27 other countries, on the fifth category–a sign of “no guarantee of rights”.

It, however, referred to the readymade garment sector, where physical force, sexual intimidation and threats of physical assault and dismissal are often used to stop workers from organising.

China, India, Malaysia, Belarus, Cambodia, Turkey, Pakistan and Qatar are other countries ranked on the same category of worst countries for workers in the world.

“While the legislation may spell out certain rights, workers have collectively no access to these rights and are therefore exposed to autocratic regimes and unfair labour practices,” the report reads about the countries that ranked at five.

The 2015 ITUC’s Global Rights Index, which ranked 141 countries on 1-5 categories against 97 internationally-recognised indicators, showed how well they were protecting employment rights such as freedom of association, collective bargaining and the rights to strike, was published for the second time.

The ITUC had been collecting data on abuse of trade union rights around the world for the past 30 years. Now for the second time the ITUC Global Rights Index presents verified information from the last 12 months so that every government and business can see how their laws and supply chains have deteriorated or improved.

The key findings of the ITUC are: Out of a total of 141 countries, the number where workers faced arbitrary arrest and detention increased from 35 to 44, and included countries such as Spain and Brazil.

In almost 60 per cent of countries, certain types of workers are excluded from their fundamental labour rights and unionists were murdered in 11 countries, one up from last year, including 22 deaths in Colombia alone, it revealed.

Seventy per cent of countries have workers with no right to strike while two thirds of countries deny workers collective bargaining rights.

The 2015 ITUC Global Index found more than half of countries in the survey deny workers access to the rule of law.

Nine countries including Syria, Central African Republic and Palestine scored even worse at 5+. This rating linked to dysfunctional legislations as a result of internal conflict and/or military occupation. Workers in those countries have equally limited rights as workers with the rating five.

Systematic violations of rights have been reported in 27 countries including Poland and the USA and the ITUC ranked them 4th.

Regular violations of rights have been found in 36 countries including Israel and Australia and they ranked 3rd.

The number of second ranking countries is 26 including Japan and Ireland where rights are violated repeatedly, according to the index.

There are 16 countries including Finland and Uruguay ranked top. Irregular violations of rights are found there. Collective labour rights are generally guaranteed, workers can freely associate and defend their rights collectively. Violations against workers are not absent but not occur on a regular basis.

“Workers in the Gulf States where the draconian ‘kafala’ system is widespread endure many of the violations which make the Middle East and North Africa the world’s worst region for fundamental rights at work,” said ITUC general secretary Sharan Burrow is a statement.

The ten worst countries for working people are Belarus, China, Colombia, Egypt, Guatemala, Pakistan, Qatar, Saudi Arabia, Swaziland and United Arab Emirates, according to the Index, the statement added.

Differing with Bangladesh’s ranking, Abdus Salam Murshedy former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said the initiative in cooperation with International Labour Organisation (ILO), Accord and Alliance ongoing in the country’s RMG sector to improve the workplace and safety issues.

“During the last one year, more than 200 trade unions got registered in the garment sector while 128 registered during the last thirty years,” he said.

“How justified is it to evaluate a large sector like RMG only by five to six incidents?” he questioned.

The export of woven garments to the US registered a negative growth in the first 10 months of the current financial year though the export earnings from the market started to rebound from the beginning of this calendar year. Exporters and analysts said there were various reasons for the negative growth that included decreasing demand for the items on compliance issue, reluctance of exporters for high duty in the market and grabbing market share by the competing countries. The export of woven garments to the US market in the July-April period of the FY 2014-15 decreased by 1.62 per cent to $3.18 billion from $3.23 billion in the same period of the FY 2013-14, according to Export Promotion Bureau data. The export of knitwear to the market, however, grew by 5.85 per cent to $1.03 billion in the period. Following the Rana Plaza building collapse a number of US buyers shifted orders from Bangladesh and good number of buyers decreased their volume of orders due to safety concern, Bangladesh Garment Manufacturers and Exporters Association vice-president Shahidullah Azim told New Age. ‘At the same time, some of our competing countries like Vietnam and India gained their capacities in the market and Bangladesh lost its space,’ he said. On the other hand, a number of exporters were looking for the alternative markets in the period and expressed their unwillingness to export to the US market due to higher duty, Azim said. A recent report launched by the Centre for Policy Dialogue stated that in the first 10 months of the FY15, the growth of export earnings was only 2.6 per cent and such performance was realised amid a number of challenges the export sector faced that included a violent and uncertain political environment, uneven developments in major export destination, falling global commodity prices and the volatile exchange rate of the euro. The report said that the export of woven garments was shifting from the US market to the EU market in recent years. During the first 10 months of the FY15, the export of woven products to the United States declined by 1.6 per cent, while a relatively strong growth rate of 7 per cent was attained in the EU market, the report said. The CPD, a local think-tank, said that this was perhaps a sign that the woven exporters in Bangladesh were gradually diverting products from the US market to the EU market due to the relaxation of the rules of origin requirement in the generalised system of preferences. Since the relaxation of the rules of origin the export of woven products has been on the rise to the European Union market. The report mentioned that the US imposed high customs duty on imports of woven products and the US government charged customs duty of $392 million on imports of woven products from Bangladesh in 2014. Abdus Salam Murshedy, president of the Exporters Association of Bangladesh, said that Bangladesh had been facing many type of challenges including compliance, deprecation of the euro, appreciation of the local currency and rising cost for doing business. These things have put pressure on the efficiency of the country’s readymade garment sector and competitor countries have grabbed the market share, he said. Salam said, ‘The key problem for the garment sector is that our competitive edge is doing down.’ According to the CPD statistic, to some extent Vietnam, India, Honduras and El Salvador registered higher growth in exporting woven products to the US in the first 10 months of the FY15. Bangladesh’s export earnings from mens/boys shirts in the July-April period of the FY15 registered 6 per cent growth while Vietnam registered 13 per cent growth. In exporting boys’ trousers and shorts of synthetic fibres, Bangladesh posted 9.40 per cent negative growth while Vietnam registered 5.4 per cent, Honduras 18.80 per cent and El Salvador 33.30 per cent growth.