The Bangladesh Textile Mills Association (BTMA) has requested the government to tighten the proposed 'Free of Cost' (FoC) import regime by capping cotton yarn and fabric imports at 15 per cent of the previous year's export value and introducing mandatory minimum local value-addition requirements for apparel exports.
In a letter, President of the BTMA Showkat Aziz Russell recently made the requests to Commerce Minister Khandakar Abdul Muktadir, urging necessary amendments to the draft Import Policy Order 2026-2029 to protect national investments and secure the country's economic future.
According to the BTMA, Paragraph 25(2) of the draft Order proposes allowing exporters to import fabrics under the FoC facility for up to 50 per cent of their previous year's export value.
The association warned that if this proposal is implemented in its current form, local spinning, weaving, and fabric processing mills will face catastrophic losses.
The letter highlights that domestic textile mills are already operating below full capacity due to several ongoing challenges, including high interest rates, energy crisis, devaluation of taka, rising production costs and intense international competition.
The BTMA said that allowing a 50 per cent free fabric import under these circumstances would drastically lower the demand for local yarn and fabric, leave massive domestic production capacities unutilised, jeopardise millions of jobs, and severely hurt local value addition and macroeconomic stability.
It has also suggested reducing the proposed 70 per cent FoC limit for synthetic fabrics to 40 per cent until local production capacity improves.
To preserve post-LDC duty-free market access, it also recommended minimum domestic value addition of 50 per cent for cotton apparel and 40 per cent for Man-Made Fibre garments.
The association further suggested limiting FoC facilities to public limited companies with at least five years of export experience, transparent operations, and BIDA approval, while urging the government to retain the proposed ban on FoC imports of knit fabrics under Paragraph 25(11).
The president highlighted the $32 billion private investment in the primary textile sector, noting that textiles and RMG drive 85 per cent of total export earnings, with local mills meeting most yarn and fabric demand.
The local textiles mills meet about 70 per cent of the demands from export-oriented industry.
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