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Businesses seek duty-free investment facility in EZs for next 5 years

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RMG Bangladesh
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The businesses of the country’s textile and apparel sector urged the government to postpone the proposed duty policy in the economic zones (EZ) investments for next five years.

Earlier, in the budget proposal for FY25, presented in parliament on June 6, Finance Minister Abul Hassan Mahmood Ali proposed a 1% import duty on all types of capital machinery for industries in economic zones and high-tech parks for the fiscal year 2024-25, which is zero currently.

He also stated that used construction materials brought in by developers for the development of economic zones will also be subject to a 1% duty.

Businesses also demanded to approve loans and permitting gas and power connections in the factories located outside of industrial zones until the EZs’s full preparedness.

They said that if the government does not change the policy, it will severely impact the investments, and as a result, employment generation will be hampered.

They made the remarks in a post-budget joint press conference on Saturday, held at the BGMEA office in the capital.

Three apex trade bodies of the RMG and textile sector, the Bangladesh Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Textile Mills Association (BTMA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), jointly organized the press conference.

Replying to a question, BGMEA President SM Mannan Kochi said that they bought 46 plots in the EZ, but it will take at least three years to set up factories. 

“Many entrepreneurs have already set up factories outside of industrial zones, and are awaiting utility connections. If the government will not provide utility connections, and banks do not approve loans for these factories, where will they go? Besides, it will be difficult for small entrepreneurs to set up factories in the EZs,” he added.

He also urged the creation of a fund for small and medium entrepreneurs with minimum interest rates for at least 15 years, saying that otherwise, small entrepreneurs would not grow considering the ongoing high interest rates and business establishment costs.

The finance minister said in the proposed budget that he will reduce cash incentives and other fasciitis to prepare for LDC graduation. The facilities will be stopped after graduation as per the WTO rules, and exporters will have to face open competition.

Regarding the issue, BGMEA Vice President Abdullah Hil Rakib said that as per the WTO rules, the government would continue the cash incentives facility for six years after graduation. 

“Otherwise, the government would provide incentives through alternative ways. We demanded from the finance ministry that either they continue existing facilities till 2032 as per the WTO clause 27 or provide alternatives before stopping the current policy. We again urged the government to do the same considering the country’s economy and employment,” he added.

Kochi said that India graduated in 2007 but the Indian government still provides policy support, incentives and other support to its textile and RMG sector in its various states.

“We are passing through a tougher situation than Covid-19 due to global geopolitical tensions and economic turmoil. Government can provide us with those supports if they will,” he added.

BKMEA Executive President Mohammad Hatem said that they demanded to reduce the source tax at 0.5% from the existing 1%.

“The government did not address anything on the budget proposal in this connection. We also demanded to consider source tax as the final settlement, but the finance minister did not say anything in his budget speech. We are still demanding the same,” he added.

Replying to a question, BTMA President Mohammad Ali Khokon said that the textile sector is severely facing gas and energy supply shortages, which impacted production. 

“’As we failed to supply RMG makers, they increased yarn and fabric imports to meet their demand. If Petrobangla supplies at least 3,000 metric million cubic feet per day in the national grid, we will be able to survive,” he added.

He also said that considering the importance of lead-time maintenance and product sustainability, they strongly demand the withdrawal of 7.5% VAT on the collection of garment industry waste and 15% VAT on the supply of fibers produced from it.

In the press conference, the BGMEA President said that in the proposed budget, the finance minister imposed a 200%-400% penalty in case of an HS Code mismatch by unintentionally. 

“Where customs and NBR frequently harass us for very negligible reasons, the mentioned penalty will again pave the way to harass us. It is not realistic. We urge the government to withdraw the proposal,” he added.

The textile millers and garment manufacturers today said the primary textile sector and the garment sector will face pressure as many issues have not been addressed in the proposed budget.

They also said that the primary textile sector and the garment sector will face pressure as many issues have not been addressed in the proposed budget.

Responding to the NBR Chairman’s claim of whitening black money as per businesses’ requests, they denied it and said that they all are against the whitening of illegally earned black money.

Along with the presidents, the vice presidents and directors of the BGMEA, BKMEA, BTMA were also present at the press conference.

Apparel leaders demand cash incentives until 2032

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RMG Bangladesh
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The apparel trade bodies believe some of the FY25 budget proposals will support the textile and apparel industries, while others will not

Apparel industry leaders have called on the government to extend the cash incentives on export receipts until 2032. Photo: TBS

Apparel industry leaders have called on the government to extend the cash incentives on export receipts until 2032. Photo: TBS

Apparel industry leaders have called on the government to extend the cash incentives on export receipts until 2032, aligning with the World Trade Organisation’s (WTO) decision to maintain LDC trade benefits for graduating countries until that year.

“As per WTO rules, the government has scope to continue cash incentives after LDC graduation,” said Abdullah Hil Rakib, vice president of the Bangladesh Garment Manufacturers and Exporters Association, held this morning (8 June) at the BGMEA building in the capital’s Uttara.

At the event organised jointly with the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMEA), BGMEA President SM Mannan Kochi said several developed countries have provided incentives to support their industries and make them competitive.

“India has been providing some incentives – 30% on land price, 40% on worker payment, and 5% on bank interest. We want such alternative incentives after LDC graduation,” he added.

The BGMEA president said the apparel trade bodies believe some of the FY25 budget proposals will support the textile and apparel industries, while others will not.

Talking about the proposals that would support the textile and apparel industries, he said 20% of the demanded amount had to be deposited previously for VAT appeals, which has now been reduced to 10%.

Kochi added that import facilities at concessional rates have been given for 17 different textile products, and the total tax incidence on importing chillers with a capacity of 50 tonnes or more for factories has been reduced from 104.68% to 10%.

However, he said the concessional import rate for chillers was previously set at 1% and requested the government put it at the same rate again.

He also said the special allocation of Tk100 crore in the FY25 budget to encourage renewable energy sources would help the industry.

“The government also reduced the import duties on two raw materials used in the production of polyester fibre (PSF) and PET chips (Textile Grade) from 10% and 25% to 1%, which will undoubtedly aid the industry,” he continued.

In a written statement, the BGMEA president mentioned some proposals from the FY25 budget that they believe will not help create investments and employment.

He said the proposals to increase the import duty on construction materials and capital machinery, the VAT on energy-saving lights, and bond license fees will not help the industry.

“Under Section 171 of the Customs Act 2023, there are provisions for a fine of 200%-400% if the HS code of imported goods is incorrect. We are requesting to withdraw this because charging such high fees for mistakes is unreasonable,” said Kochi.

He also requested consultations with all stakeholders before implementing the new Customs Act.

He said the industry faced a global slowdown and high inflation due to geopolitical reasons, just as it was recovering from the Covid-19 pandemic. These factors reduced consumers’ purchasing power.

“Moreover, in the last five years, local production costs have increased by about 50%, putting the industry in a crisis,” he added.

Kochi said the apparel export growth has alarmingly decreased in the past seven months, with a 17% decrease in May alone.

“We have increased wages by 56%, but our prices have not. Instead, the prices of our main products have dropped by 8%-18% in the last nine months,” he added.

“At a time when the industry is in such a crisis, what was needed the most was to support the apparel industry, which earns a significant portion of export revenue, and through this support, to increase reserves and control inflation,” the BGMEA president said.

Apparel export growth is 2.86% in July-May period

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RMG Bangladesh
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As single month, May saw a major shock in apparel exports

In the 11th month of the current fiscal year (July-May), apparel exports were worth $43.85 billion, which is 2.86 percent higher than the same period of the previous fiscal year 2022-23. This information is known from a report of the Export Promotion Bureau (EPB) published on Wednesday (May 5).

Apparel export growth is 2.86% in July-May period

According to EPB data, knit products exported during this period were worth $24.70 billion. In this case, the growth is 6.15 percent. On the other hand, the export of woven garments was $19.14 billion, which is 1.09 percent less than the previous year.

However, as single month, May saw a major shock in apparel exports. Apparel export in May of the current fiscal year is $3.36 billion which is 17.03 percent less than $4.05 billion of same period of last fiscal year.

President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) SM Mannan (Kochi) said that recently due to inflation in the world economy and increase in interest rates to control it, the purchasing power of consumers has decreased. As a result, apparel retail sales and imports declined. US global apparel imports fell by 7.18 percent and Europe by 12.84 percent in the January-March period.

Mohammad Hatem, Executive President of BKMEA, said that the growth in export earnings is expected to be negative, because now the work orders are low. On the other hand, we are not able to accept the work orders due to increase in production cost. On the one hand, buyers are not paying fair prices for the products. The cost of production has increased due to the increase in the price of electricity, gas and other services. As a result, we cannot survive in price competition.

He said, because of the dollar crisis, it takes a long time to open the LC. As a result, global buyers are placing fewer orders due to increased lead times. Apart from this, it is difficult to deliver our products on time due to customs harassment.

Declining apparel exports in May hit overall export earnings. In May, exports of goods totaled 4.07 billion dollars, which is 16 percent less than the same period last year. However, in the first 11 months (July to May) of the current fiscal year, overall exports worth $51.54 billion which is 2.01 percent higher than the export of $50.30 million in the same period of the previous fiscal year.

BTMA calls for removal of 7.5% VAT on scrap RMG fabric, 15% on recycled fibres

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RMG Bangladesh
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BTMA president said the recycling mills in Bangladesh cannot use these RMG scraps to make fibres due to the 22.5% VAT, which turns the scraps into waste and pollutes the environment

Recycling all textile waste locally could save Bangladesh nearly $500 million in imports. Photo: Rajib Dhar

Recycling all textile waste locally could save Bangladesh nearly $500 million in imports. Photo: Rajib Dhar

Bangladesh Textile Mills Association (BTMA) has demanded that the 7.5% VAT levied on scrap RMG fabrics [jhut] and 15% VAT on fibres made using such scraps be removed from the budget for FY25. 

“We are required to pay a 7.5% VAT on the scrap RMG fabrics and 15% VAT on fibres made using them. The recycling mills in Bangladesh cannot use these RMG scraps to make fibres due to the 22.5% VAT, which turns the scraps into waste and pollutes the environment,” said Mohammad Ali Khokon, president of BTMA, during a press conference on the FY25 national budget in the capital today (8 June).

Noting that the industry can produce 1,200 million kilograms of fibre using these scraps worth $4 billion each year, he said, “We are currently importing such fibre from abroad using foreign currency. International buyers often set conditions for producing 30%-40% of clothes using recycled fibres.”

The BTMA chief called on the authorities to withdraw the VATs on RMG scraps, considering the sustainability of the products.

During his speech, the BTMA president also demanded the withdrawal of the 5% VAT on man-made fibre, and 5% advance tax, as well as 5% advance income tax on flax fibre. 

“Chillers are essential to maintaining proper humidity levels inside textile mills. They are necessary machinery,” he said, noting that textile mills typically use chillers with a capacity of 50 tonnes or more. 

“The government already reduced the total tax incidence on chillers from 104.68% to 10%. However, we believe it should go back to 1% considering chillers as capital machinery,” Khokon said.  

He also requested that the RMG source tax be reduced from the current 1% to 0.5% and remain at that rate for the next five years, considering it the final settlement.

During his speech, the BTMA president said the textile and clothing industry faces issues due to the dollar crisis, inadequate energy supply, and the interest rate hike. 

“In this situation, we demand keeping the same corporate tax until 2030,” he said. 

“The 171 clause of the Customs Act-2023 states that any slight error in HS code would result in a 200%- 400% fine,” Khokon said, requesting the prime minister to withdraw this fine before the next budget.

Reducing apparel imports to boost Bangladesh’s local garment industry

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RMG Bangladesh
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Bangladesh, the world’s second-largest apparel exporter, paradoxically imports ready-made garments worth approximately Tk 5 billion annually, primarily from India, Pakistan, and China.

Reducing apparel imports to boost Bangladesh’s local garment industry
Figure: Reducing apparel imports to boost Bangladesh’s local garment industry.

According to the National Board of Revenue (NBR), Bangladesh legally imported 23.5 million pieces of ready-made garments last year, with a total value of nearly Tk 5.02 billion. This marked a decrease in volume but increase in value from 2022, when 26.3 million pieces were imported at a cost of Tk 4.66 billion. The higher costs despite the lower volume last year were attributed to the elevated exchange rate of the dollar, which increased import expenses.

In the first three months of this year alone, Bangladesh imported a staggering 7.5 million pieces of clothing, amounting to Tk 2.14 billion. Bangladesh imports three-piece suits and sarees for women, and panjabis for men mostly from India, while Pakistan supplies mainly three-piece suits. From China, imports include T-shirts, jerseys, and jackets.

The NBR reports that the average price per imported garment last year was Tk 214. After adding a 127% customs duty, this price increased to Tk 475.

Despite the strong presence of local fashion brands and boutique houses, this heavy reliance on imports undermines the potential of the domestic market. To reduce these imports and bolster local production, several strategic measures are necessary.

Strengthening local production capabilities

First and foremost, enhancing the capacity and quality of local garment manufacturing is crucial. Bangladesh’s garment sector is already a global powerhouse, exporting more than $47 billion worth of textiles in 2022. Leveraging this expertise, local manufacturers should focus on diversifying product lines to cater to domestic tastes and preferences. Investing in modern technology and skilled labor can further improve the quality and variety of locally produced garments, making them more appealing to Bangladeshi consumers.

Government incentives and support

Government support is pivotal in reducing apparel imports. Implementing policies that provide incentives for local manufacturers can significantly boost domestic production. For instance, increasing subsidies for locally produced garments and reducing taxes on raw materials would lower production costs. Additionally, providing low-interest loans and grants for technological upgrades and expansion projects can empower local businesses to scale up their operations.

The government should also consider increasing import duties on finished garments while providing tax breaks or incentives for using locally sourced materials. This dual approach would make imports less attractive while encouraging local production. Strict enforcement of import regulations is necessary to curb illegal imports that further undermine the local industry​ (The Business Standard)​.

Enhancing supply chain efficiency

Improving the efficiency of the local supply chain is essential. The Bangladesh textile industry often faces challenges related to raw material procurement and logistics. Addressing these issues through better infrastructure and streamlined processes can reduce production delays and costs. The establishment of textile hubs and industrial zones with integrated supply chains can facilitate smoother operations and lower logistical hurdles.

Promoting local brands

Raising awareness and promoting local fashion brands can also play a significant role in reducing imports. Marketing campaigns highlighting the quality, affordability, and unique designs of Bangladeshi garments can shift consumer preferences towards local products. Collaborations with local designers and fashion influencers can help create a stronger brand identity and increase the appeal of domestic apparel.

Reducing apparel imports to boost Bangladesh’s local garment industry

Moreover, initiatives such as fashion shows, trade fairs, and digital marketing can showcase the talent and creativity of Bangladeshi designers, fostering a sense of national pride and encouraging consumers to support homegrown brands.

Encouraging sustainable practices

Sustainability is becoming increasingly important in the global apparel industry. By adopting eco-friendly practices and emphasizing sustainable production, Bangladeshi manufacturers can attract environmentally conscious consumers. Government policies that promote sustainable practices, such as providing subsidies for eco-friendly materials and processes, can further enhance the competitiveness of local garments.

Addressing raw material challenges

One of the significant hurdles for the local textile industry is the dependency on imported raw materials. To mitigate this, the government should encourage the cultivation and production of raw materials within the country. Research and development in high-yield cotton varieties and other raw materials can reduce reliance on imports and stabilize the supply chain.

Additionally, fostering partnerships with local suppliers and investing in modern agricultural practices can improve the quality and availability of raw materials, thereby supporting the local textile industry.

In fine, reducing apparel imports and meeting domestic demand with locally made garments requires a multi-faceted measures. These measures will not only support the local economy but also create jobs and foster a robust, self-sufficient garment industry. The collaboration between the government, industry stakeholders, and consumers is crucial to realizing this vision and ensuring the long-term sustainability of Bangladesh’s apparel sector.

Duty cut on textiles’ raw materials; tariff hike for finished fabrics to protect local industry

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RMG Bangladesh
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Industry insiders, however, said their demand was not reflected in the budget as the waiver included the least-used categories, leaving out most-used fibres from their list of 27

Represenattaional image. Picture: Collected

Represenattaional image. Picture: Collected

In a bid to help local textile industries diversify their export basket, the government will now offer a 1% import duty on 18 types of non-cotton fibre, down from 10-31%. 

“As per the recommendation of Bangladesh Textile Mills Association [BTMA], I propose to include some raw materials related to the import of machinery, spare parts and raw materials for the textile industry,” said Finance Minister Abul Hassan Mahmood Ali during the budget speech today (6 June).

Industry insiders, however, said their demand was not reflected in the budget as the waiver included the least-used categories, leaving out most-used fibres from their list of 27. 

“We welcome the inclusion of some non-cotton fibre in the list of raw materials with reduced import duty. However, the rest should also be included if we want to diversify our export basket,” said Mohammad Ali Khokon, president of the BTMA. 

During his budget speech, the finance minister proposed increasing the minimum value of imported cotton from $3 to $4 per kg. 

He also proposed increasing the minimum value of imported polyester and synthetic fabrics from $3 to $4.5 per kg.

‘Labour Information Management System’ will be launched to improve workers’ living standards

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RMG Bangladesh
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The government set a target to achieve compliance in 1,550 factories within the ready-made garment (RMG) sector, to ensure a decent work environment, Finance Minister Abul Hassan Mahmood Ali said

The process of developing a database by incorporating information from 3,00,000 workers in the first phase is currently underway through a software called “Labour Information Management System (LIMS)” during FY2024-25, to improve workers’ living standards.

In the proposed budget for FY25, placed in the parliament today (6 June), Finance Minister Abul Hassan Mahmood Ali said the government set a target to achieve compliance in 1,550 factories within the ready-made garment (RMG) sector, to ensure a decent work environment.

A target has also been set to provide free primary healthcare services to 3.76 lakh workers and recreational services to 4.55 lakh workers. Apart from this, to protect the fundamental rights of workers, a target has been set to provide training to 49,500 workers.

বাজেটে শ্রমিকদের রেশনের জন্য বরাদ্দের দাবিতে পদযাত্রা

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RMG Bangladesh
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২০২৪-২৫ অর্থবছরের বাজেটে শ্রমিকদের জন্য রেশন বরাদ্দ বৃদ্ধিসহ আট দফা দাবিতে সংসদ অভিমুখে পদযাত্রা করেছে বাংলাদেশ টেক্সটাইল গার্মেন্টস শ্রমিক ফেডারেশন। সংগঠনটি বলেছে, শ্রমিকদের রেশনিংয়ের জন্য বাজেটের ১০ শতাংশ বরাদ্দ রাখতে হবে।

আজ বুধবার বিকেলে জাতীয় প্রেসক্লাবের সামনে শ্রমিক সমাবেশ শেষে এ পদযাত্রা করে সংগঠনটি। এ সময় সংসদের স্পিকার বরাবর একটি স্মারকলিপিও দিয়েছে তারা।

পদযাত্রার আগে শ্রমিক সমাবেশে সভাপতিত্ব করেন বাংলাদেশ টেক্সটাইল গার্মেন্টস শ্রমিক ফেডারেশনের সভাপতি মাহবুবুর রহমান ইসমাইল। তিনি বলেন, জাতীয় বাজেট, শিল্প, কৃষি, স্বাস্থ্য, শিক্ষা, প্রতিরক্ষা প্রভৃতি খাতে আলাদা বরাদ্দ থাকলেও শ্রমিকদের জন্য এমন কোনো পৃথক বরাদ্দ নেই। মোট দেশজ উৎপাদনে (জিডিপি) প্রায় ছয় কোটি শ্রমিকের অবদান সবচেয়ে বেশি। অথচ এই শ্রমিকদের জন্য কোনো রেশনিং ব্যবস্থা নেই। শ্রমিকদের স্বাস্থ্য সুরক্ষা, চিকিৎসা ও সন্তানের লেখাপড়ার ভালো সুযোগ নেই। বাস্তবে শ্রমিকদের ভবিষ্যৎ বলতেই কিছু নেই।

মাহবুবুর রহমান জানান, ৫২ বছরে বাজেটের আকার ৯৬৭ গুণ বৃদ্ধি পেয়ে প্রায় ৮ লাখ কোটি টাকা হয়েছে। তবে সরকারের উন্নয়ন আর জিডিপি বৃদ্ধির ঘটনায় শ্রমজীবী মানুষের ভাগ্যের কোনো উন্নতি হয়নি। বাংলাদেশ ইতিমধ্যে নিম্ন আয়ের দেশ থেকে নিম্ন মধ্যম আয়ের দেশে উন্নীত হয়েছে। সে কারণে শ্রমিকদের জীবনমান দারিদ্র্যসীমার নিচে থাকতে পারে না।

সমাবেশে সংহতি জানিয়ে বক্তব্য দেন শ্রমিক নেতা সালাউদ্দিন স্বপন, শহিদুল ইসলাম, লাভলী ইয়াসমিন, শবনম হাফিজ, সুলতানা আক্তার, কে এম মিন্টু, রাজু আহমেদ, এফ এম আবু সাঈদ, হারুন সরকার, আবদুল করিম শেখ। আরও বক্তব্য দেন ঢাকা রাইড শেয়ারিং শ্রমিক ইউনিয়নের সভাপতি সজীব হোসেন, সাধারণ সম্পাদক হালিম তালুকদার, কেন্দ্রীয় নেতা কামরুল ইসলাম প্রমুখ।

বক্তারা বলেন, টাকার অঙ্কে শ্রমিকের মজুরি বাড়লেও দ্রব্যমূল্য বৃদ্ধির কারণে শ্রমিকেরা আজ অভাব-অনটনে দিন যাপন করছেন। রেশনিং ব্যবস্থা চালু থাকলে সিন্ডিকেট কালোবাজারি ব্যবসায়ীরা দ্রব্যমূল্য বাড়িয়ে শ্রমিকদের পকেট থেকে অর্থ লুটে নিতে পারতেন না।

News sources :prothomalo

Pay workers’ wages, bonuses before Eid-ul-Adha: NHRC urges factories

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RMG Bangladesh
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The National Human Rights Commission (NHRC) has urged all factory owners to pay their workers’ wages for May and bonuses before the Eid-ul-Adha holidays.

In a statement issued today (4 June), the commission said it is important to pay the workers’ dues before Eid to prevent any disruption of law and order and protect their rights.

The commission noted that on 1 June, various organisations held a protest rally in front of the Jatiya Press Club on behalf of garment workers demanding their due salaries for May and Eid bonuses.

The NHRC’s statement comes in the wake of protests by garment workers every year, usually before Eid.

In this context, the NHRC has called for the timely payment of workers’ wages and allowances to maintain a peaceful environment.

In the statement, NHRC Chairman Dr Kamal Uddin Ahmed said, “Article 23 of the Universal Declaration of Human Rights, adopted in 1948, speaks of the right to fair and favourable remuneration.

“In this case, we also have a constitutional commitment and legal obligation.

“Ensuring timely payment of the wages is a fundamental responsibility of every establishment. There is no alternative to this for safeguarding workers’ rights and maintaining a peaceful environment,” he added.

On 1 June, the Industrial Police urged the manufacturers of the country’s readymade garment (RMG) and textile sector to clear wages and allowances of their workers before the start of Eid-ul-Adha holidays as per the government’s decision.

Garment accessory makers seek tax cuts, revised import rules in budget proposals

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RMG Bangladesh
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The Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association submitted their budget proposals for the fiscal year 2024-25, outlining measures they believe will strengthen the industry’s contribution to the country’s garment sector.

The association, representing a crucial segment of the garment industry’s supply chain, proposed a decrease from the current 1% tax to 0.25%, arguing that this aligns with previous government initiatives to encourage exports.

Additionally, they seek a fixed rate for at least five years to provide predictability and stability for businesses planning their investments.

The association’s President Al Shahriar Ahmed, during a media briefing today, said that considering the current global economic climate, they hope the government will consider revising the tax rate again to further stimulate exports.

The manufacturers and exporters association also seeks a level playing field for both tariff and non-tariff-bonded establishments.

Currently, there are limitations on the import availability for non-tariff bonded establishments compared to those located within designated tariff zones.

These zones, often managed by authorities like the Bangladesh Export Processing Zone Authority or Bangladesh Economic Zones Authority, offer certain benefits like tax breaks and simplified customs procedures. Businesses operating within these zones are considered bonded establishments.

The manufacturers and exporters association requested a three-year import availability period specifically for the accessories sector. This would allow manufacturers to manage their raw material needs more effectively and avoid delays caused by slow audits, which can be a particular issue for non-tariff bonded establishments.

The organisation also pointed out that 15-18% of the final price of a garment product is attributed to accessory components. Furthermore, the domestic accessories sector currently fulfils nearly 100% of the demand for the country’s major export-oriented apparel industry.

Streamlining imports, protecting domestic production

Another key demand concerns the import process for export-oriented businesses. The association urges the government to eliminate the requirement for bank guarantees on imported goods, which can be a financial burden and cause delays.

Furthermore, they propose the exclusion of all local purchases made by export-oriented industries from the existing 15% value-added tax (VAT). This would significantly reduce production costs for the industry.

To bolster the domestic garment accessories industry and ensure its continued support for the readymade garments sector, the manufacturers and exporters association proposes a ban on the import of finished garment accessories and packaging products under bond.

This would incentivise local production and enhance the overall competitiveness of Bangladesh’s export sector in the international market.

The organisation’s president, Al Shahriar, urged to ban the import of finished products of garments accessories and packaging under the bond in order to sustain the domestic industry and to keep the direct export sector competitive in the international market.

The association underscored its role as a 100% export-oriented industry, supplying vital components to the readymade garment sector, a major contributor to Bangladesh’s export earnings.

They believe that the proposed reforms are essential to maintain Bangladesh’s position as a leading garment exporter and ensure the continued growth of both the accessories sector and the RMG industry as a whole.

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Ready Made Garments sector is the key source of foreign currency and GDP for Bangladesh. Approximately 4.2 million people are dependent on the RMG sector for their bread and butter.
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