Apparel exporters seek uninterrupted gas supply and its price cut as they say production in textile mills almost stalled with resultant disruption to timely shipment of yarn, fabrics and garments.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA) in a letter to government high-ups have made this one in a package of demands to help them make most utilization of their production capacity and meet lead time in export, mainly to western markets.
Industry sources said they also requested the government to cut down the price of gas to Tk 16 a cubic metre from the hiked rate of Tk 30 in line with falling international prices of energy, mentioned as "lowest" now.
The three trade bodies of the export sector-- BGMEA, BKMEA and BTMA-made the pleas in their joint letter on July 13 to the prime minister's principal secretary, Mohammad Tofazzel Hossain Miah.
"The government had assured of providing uninterrupted supply of energy to the industry at the time of raising the gas price last February. But production in textile mills remained almost suspended for want of gas," the letter reads.
On the other hand, supply and shipments of work orders for yarn, fabrics and readymade garment items are also being disrupted, it is stated in the letter, signed by BGMEA president Faruque Hassan, BKMEA executive president Mohammad Hatem and BTMA president Mohammad Ali Khokon.
"As a result, cost of production has been rising," the owners-exporters says in their representation about the cascading impact of fuel crunch.
The global market for textile and apparel has shrunk 30 per cent during the last two years mainly because of the price hike of raw materials, energy and dollar following the covid-19 pandemic and the Russia-Ukraine war.
Amid the high prices of raw materials on the global market, the latest price hike of gas to Tk 30 a cubic metre from Tk 16 has raised the cost of production for yarns and fabrics significantly, they said.
On the back of rise in production and process costs, factories could not utilize their production capacity up to 50 per cent, mentioned the associations of the sector that alone fetches over 80 per cent of Bangladesh's total export earnings.
Timely shipment to global orders for textiles and clothing was also disrupted, they said, demanding uninterrupted gas supply and resetting the rate at Tk 16.
The leaders in the letter also demanded increase the limit to Export Development Fund loan for the spinning mills to $30 million and extending the repayment period up to 360 days instead of 180 days.
They also demand a moratorium on all types of loans, including term loans, up to June 30, 2024, saying that there has been a liquidity crisis in the textile sector due to pile-up of unsold yarns and fabrics in the mills.
Munni_fe@yahoo.com
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