Indonesia wants to relocate textile units to Bangladesh
Saturday, 15 May 2010
Mehdi Musharraf Bhuiyan
Indonesia is looking for relocating its age-old apparel manufacturing industries to Bangladesh to take advantage of the country's duty free access facilities in the international market, a senior Indonesian diplomat said in the city Thursday.
The ASEAN country, which is a major supplier of textile products in the world market, is also looking to set up joint ventures with the local entrepreneurs to make a foray into the local business arena, the embassy official said.
"There are good potentials for the Indonesian apparel manufacturers to relocate their plants in Bangladesh", Hendra P Iskandar, First Secretary for Economic Affairs for the Indonesian Embassy in Dhaka told FE.
"This would enable them to take the opportunity of the GSP (Generalized System of Preferences) facilities enjoyed by the third world economies while offering them cheap labour and lower production cost for manufacturing" he added.
Textile is a major export item for Indonesia for decades and employs the highest number of people among the manufacturing segments. The recent years, however, have seen the country facing stiff competition from India, Bangladesh and China in the international level due to competitive pricing.
With more than 230 million people, Indonesia is the largest economy in Southeast Asia and it is also a member of the G-20 major economies. The flow of Indonesian investment in Bangladesh however is meager despite growing bilateral trade.
The two-way trade volume between Bangladesh and Indonesia amounted to US$ 900 million in 2009 which, according to estimates of Indonesian Chamber of Commerce and Industry, is poised to hit one billion US Dollar mark this year.
This increase in trade nevertheless will be aided by further growth in the Indonesian export to Bangladesh, which crossed US$ 800 million in the previous year.
Major Indonesian exports to Bangladesh include raw materials for textiles, chemical products, automobile and automobile parts, cosmetics and plastic materials, while Bangladesh ships mainly jute, textiles and pharmaceuticals.
The Indonesian official, however, observed that there are scopes for increasing export for both the countries through increasing cooperation between the business people.
"There is huge market potential in Bangladesh for Indonesian apparels, furniture, cosmetic and beauty products or even aircraft while Bangladeshi pharmaceutical companies can make further foray into our market" the Indonesian diplomat said.
Indonesia is looking for relocating its age-old apparel manufacturing industries to Bangladesh to take advantage of the country's duty free access facilities in the international market, a senior Indonesian diplomat said in the city Thursday.
The ASEAN country, which is a major supplier of textile products in the world market, is also looking to set up joint ventures with the local entrepreneurs to make a foray into the local business arena, the embassy official said.
"There are good potentials for the Indonesian apparel manufacturers to relocate their plants in Bangladesh", Hendra P Iskandar, First Secretary for Economic Affairs for the Indonesian Embassy in Dhaka told FE.
"This would enable them to take the opportunity of the GSP (Generalized System of Preferences) facilities enjoyed by the third world economies while offering them cheap labour and lower production cost for manufacturing" he added.
Textile is a major export item for Indonesia for decades and employs the highest number of people among the manufacturing segments. The recent years, however, have seen the country facing stiff competition from India, Bangladesh and China in the international level due to competitive pricing.
With more than 230 million people, Indonesia is the largest economy in Southeast Asia and it is also a member of the G-20 major economies. The flow of Indonesian investment in Bangladesh however is meager despite growing bilateral trade.
The two-way trade volume between Bangladesh and Indonesia amounted to US$ 900 million in 2009 which, according to estimates of Indonesian Chamber of Commerce and Industry, is poised to hit one billion US Dollar mark this year.
This increase in trade nevertheless will be aided by further growth in the Indonesian export to Bangladesh, which crossed US$ 800 million in the previous year.
Major Indonesian exports to Bangladesh include raw materials for textiles, chemical products, automobile and automobile parts, cosmetics and plastic materials, while Bangladesh ships mainly jute, textiles and pharmaceuticals.
The Indonesian official, however, observed that there are scopes for increasing export for both the countries through increasing cooperation between the business people.
"There is huge market potential in Bangladesh for Indonesian apparels, furniture, cosmetic and beauty products or even aircraft while Bangladeshi pharmaceutical companies can make further foray into our market" the Indonesian diplomat said.