New Delhi's offer to import eight million pieces of garments from Bangladesh, aimed at reducing the trade deficit, may not be completely executed as prices being offered by many Indian buyers are quite low, sector insiders said Saturday.
Their observation came after Bangladesh exported nearly one million pieces of garments for the first time to India in the past two months (May and June) enjoying the zero-tariff access facility.
Sector insiders said there is little or no possibility to export the entire 8.0 million pieces of Readymade garments (RMG) to India by this calendar year as New Delhi had initially delayed the process of export.
President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Fazlul Haque, said: "We may not fulfill the quota of 8.0 million pieces this year for various reasons despite getting duty-free quota facility."
India signed a deal with Bangladesh in September last year for import of 8.0 million pieces of RMG in a calendar year (January-December) offering zero-tariff facility.
Under the deal, the Bangladeshi apparel owners were expected to ship the first consignment of RMG to India in January this year but it was not possible, as the Indian authorities could not complete the required import formalities after signing the deal.
A senior official of the Export Promotion Bureau (EPB) said: "Our manufacturers exported nearly a million pieces to India in the past two months."
He added: "Our apparel owners are reluctant to accept export orders from Indian buyers as prices offered by them are not lucrative."
Requesting for anonymity, a local manufacturer said: "I had an offer to export garments to India but the prices offered by the importers were not attractive."
President of Bangladesh Garments Manufacturers and Exporters Association (BGMEA) Anwar Ul Alam Chowdhury Parvez said it is true that at this stage Indian market is not attractive for the manufacturers.
"We have the opportunity to boost export if the door remains open as India is an emerging market."
Besides the price issue, BKMEA president said there is a need for development of market in India to boost export to reap optimum benefit of the deal signed between the nations.
The deal, signed under the purview of the South Asian Free Trade Area (SAFTA) agreement reached among the South Asian Association for Regional Cooperation (SAARC) member- countries, aimed at reducing trade gap between the two neighbouring country.
India, largest trade partner of the country, annually export products worth $ 2.0 billion to Bangladesh. Bangladesh's exports to India accounts for about $300 million, the official said.
When asked, an official said the export of 8.0 million pieces of RMG to India will help Bangladesh fetch US$40 million yearly.
Regarding total quantity of RMG export, director General of the EPB Md Khalilur Rahman said in the just concluded fiscal 2007-08 year Bangladesh exported nearly 135 million pieces of garments against 123 millions in the last fiscal year to overseas markets.
He said the sector grew around 16 per cent to power the first 11 months exports past US$ 12.63 billion in the eleven-months of the just concluded fiscal over that in the same period of the fiscal 2006-07 year.
