Economic affairs adviser to the Prime Minister Mashiur Rahman attended a national seminar on role and challenges of garments accessories and packaging sector as the chief guest, organised by the Bangladesh Garments Accessories & Packaging Manufacturers & Exporters Association on Tuesday in Dhaka. — FE Photo
The country's accessories and packaging sector requires policy attention from the government needed to achieve the $50-billion export target from the apparel sector by 2021, experts said.
According to the experts, despite having its significant contribution to the exports, the accessories packaging sector is still ignored as they face discrimination in getting the government's policy support.
Keeping these in view, they suggested that the government should provide cash incentive, reduce corporate tax and source tax as given to other export-oriented sectors such as the garment industry.
They also called for declaring the sector a thrust one and provide related support in the light of that.
The suggestions were made at a seminar on "$50 billion RMG exports by 2021: Role and Challenges of Garments Accessories and Packaging Sector," organised by the Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) held in the city.
Abdul Kader Khan, president of BGAPMEA, chaired the seminar and its former president Rafez Alam Chowdhury made the keynote presentation.
Mashiur Rahman, economic affairs adviser to the Prime Minister, was present as the chief guest, while Kazi M Aminul Islam, executive chairman of Bangladesh Investment Development Authority, Shubhashish Bose, commerce secretary, Bijoy Bhattacharjee, vice chairman of Export Promotion Bureau and Shafiul Islam Mohiuddin, president of the Federation of Bangladesh Chambers of Commerce and Industry spoke at the seminar, among others.
The backward linkage industry meets nearly 95 per cent demands of accessory and packaging for the export-oriented industries including RMG and pharmaceuticals, Mr Chowdhury said, adding the sector earned $6.70 billion through deemed export while it also made direct exports worth $1.12 billion in the last fiscal year.
"Though there is no difference between deemed and direct export, the sector is facing discrimination in getting the government's policy support," he said.
He added the sector never got any cash incentive as given to other sectors helping those to flourish.
The government fixed corporate tax at 10 per cent and 12 per cent for green and non-green RMG factories whereas the rate is 35 per cent for its backward linkage garments accessories and packaging (GAP) industry, he said demanding equal tax measures for the sub-sector.
Importers have to take entitlement certificate from Customs Bond Office and they are not issuing it as per instruction from the National Board of Revenue, which hinders the growth, he said, explaining the challenges of the sector.
"Port facilities are not sufficient to cope with volume of import and export transaction," he said, adding that the port is overloaded with consignments and the delayed release imposes extra charges that inflated the production cost.
He urged the government to address the issue immediately.
The government should seriously think about the sub-sector for the sake of the apparel industry as it is closely working with the RMG industry contributing to its growth.
Terming compliance another major issue, Abdus Salam Murshedy, president of the Exporters Association of Bangladesh, said that the western buyers have already inspected the backward linkage industry including washing, printing and other segments.
To be competitive is a challenge as price competitiveness is gradually declining mainly because of strong local currency against the US dollar, he said, suggesting the formulation of monetary policy for the export-oriented sector.
He also suggested setting up of an inland container depot near the production hub at Gazipur.
Virtually the activities of Kamalapur ICD remain halted as Dhaka city is not the production area and trucks cannot move during daytime in the city.
Mashiur Rahman, economic affairs adviser to the prime minister, said, "We can consider the relocation of the ICD to the areas where our main export item readymade garments is being produced."
To attain the expected growth for the graduation, the industry needs production, productivity, efficiency, technology and market, he said.
He also suggested rationalising tariff measures to stop the misuse of bonded-warehouse facility.
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