Plastic goods sector seeks cash incentives

Shamsul Huda | Published: January 27, 2014 00:00:00 | Updated: November 30, 2024 06:01:00

Plastic goods manufacturers and exporters are facing problems both locally as well as in the export market and are seeking cash incentives, sources said.
The exporters want cash incentives from the government as they need to pay 5 to 15 per cent higher duty for export in the US market due to withdrawal of GSP facilities, sources said.
The sources said they have called on the commerce minister and placed demand for cash incentives against export due to their higher export costs in the US and in other markets.
Apart from higher duty in the US market the sector is also facing tough competition with India in the US and other markets, said Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA) former president Shahedul Islam Helal.
He said, "Our main competitor India has devalued its currency by 18 per cent. So their export cost has also come down. As a result they can offer lower prices than us in the export market."
He said to save millions of dollars of investment in this sector they need patronisation from the government.
Apart from the problem in the export market, the sector is also facing difficulties in the local market due to jute protection law.
A plastic goods manufacturer source said under the law the government has made use of jute bags compulsory in some major goods packaging which are the main customers of the plastic bags.
He said the jute protection law is not commercially viable as some goods packaging industry are currently using jute bags at the cost of Tk80 per bag.
He said plastic bag costs only Tk15 which is commercially viable and lowers the price of the products.
The industry sources said due to such a law a good number of plastic factories have shut down their production as they do not get customers due to compulsory use of jute bags on a vast scale.
BPGMEA president Md. Jashimuddin said the jute protection act is hampering the overall packaging industry in the country.
He said the government should review the act. Otherwise the growing packaging industry would be affected.
He said use of jute bags is not healthy in many cases due to humidity problem.
The BPGMEA president said carrying fertilizer and other food items using plastic bags are more scientific but the government has made compulsory of using jute bags in those products.
Mr. Jashim said the GSP has affected local plastic industry and on the other hand the local jute protection law is also hampering the sector.
He said to save the overall industry the government should come forward and provide cash incentives on export and review the jute protection law.