Apparel sector to get Tk 2.0b as subsidy before Eid
Monday, 7 September 2009
FE Report
The government is likely to disburse a subsidy of Tk 2.0 billion before the Eid-ul-Fitr to overcome the ongoing crisis faced by the apparel sector.
Finance Minister AMA Muhith declared this to the leaders of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) when they met him at his office Sunday.
"The finance minister has realised our situation, and assured us of releasing at least Tk 2.0 billion as subsidy before Eid so that manufacturers could pay their workers wages and bonuses properly," Md Fazlul Hoque, BKMEA president told journalists later at a press conference in the city.
The export-oriented garment manufacturers who use locally produced fabrics get cash incentives after audit but this allocation will be made un-audited.
"The banks will disburse the subsidy money pending audit. This is nothing new, the government earlier used to pay subsidy in this way," Mr Hoque claimed.
However, slamming the demand for the Tk 30 billion-stimulus package by the BGMEA, the finance minister told reporters that the garment owners are not in a state that they will not be able to pay wages and bonuses to their workers.
Emerging from the meeting with the BKMEA, Mr Muhith said, "The demand for Tk 30 billion bailout by the BGMEA is not justified."
"I don't see any reason why the apparel sector will be unable to pay salaries and Eid bonuses to their workers," he told the journalists.
However, BKMEA chief said that the state of their sub-sector is not as bad as to render them unable to pay salary and bonus to the workers before Eid.
"We've already asked our fellow members on August 28 to disburse the salaries and bonuses to their workers before the festival of Eid," he added.
The BKMEA chief said the export growth of the sub-sector has declined to some extent last fiscal as compared to an average of 22 plus growth for the last 12 years.
"But, the growth is not as bad as we apprehended amid the global recession, when the price fell by 5 to 9 per cent," he claimed.
Mr Hoque said his sector incurred losses worth at least US$ 900 million over the past nine months simply because of fall in orders and prices.
The BKMEA president said he had also requested the minister to continue the bailout package for another six months, preferably one year.
The taskforce formed to monitor the affect of recession is likely to meet for the second time on October 15 or 16.
Finance ministry sources said it would be releasing another Tk 1.11 billion soon as subsidy against an outstanding cash incentive of around 5.0 billion for the apparel sector.
The government is likely to disburse a subsidy of Tk 2.0 billion before the Eid-ul-Fitr to overcome the ongoing crisis faced by the apparel sector.
Finance Minister AMA Muhith declared this to the leaders of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) when they met him at his office Sunday.
"The finance minister has realised our situation, and assured us of releasing at least Tk 2.0 billion as subsidy before Eid so that manufacturers could pay their workers wages and bonuses properly," Md Fazlul Hoque, BKMEA president told journalists later at a press conference in the city.
The export-oriented garment manufacturers who use locally produced fabrics get cash incentives after audit but this allocation will be made un-audited.
"The banks will disburse the subsidy money pending audit. This is nothing new, the government earlier used to pay subsidy in this way," Mr Hoque claimed.
However, slamming the demand for the Tk 30 billion-stimulus package by the BGMEA, the finance minister told reporters that the garment owners are not in a state that they will not be able to pay wages and bonuses to their workers.
Emerging from the meeting with the BKMEA, Mr Muhith said, "The demand for Tk 30 billion bailout by the BGMEA is not justified."
"I don't see any reason why the apparel sector will be unable to pay salaries and Eid bonuses to their workers," he told the journalists.
However, BKMEA chief said that the state of their sub-sector is not as bad as to render them unable to pay salary and bonus to the workers before Eid.
"We've already asked our fellow members on August 28 to disburse the salaries and bonuses to their workers before the festival of Eid," he added.
The BKMEA chief said the export growth of the sub-sector has declined to some extent last fiscal as compared to an average of 22 plus growth for the last 12 years.
"But, the growth is not as bad as we apprehended amid the global recession, when the price fell by 5 to 9 per cent," he claimed.
Mr Hoque said his sector incurred losses worth at least US$ 900 million over the past nine months simply because of fall in orders and prices.
The BKMEA president said he had also requested the minister to continue the bailout package for another six months, preferably one year.
The taskforce formed to monitor the affect of recession is likely to meet for the second time on October 15 or 16.
Finance ministry sources said it would be releasing another Tk 1.11 billion soon as subsidy against an outstanding cash incentive of around 5.0 billion for the apparel sector.