The Bangladesh Textile Mills Association – BTMA has recently urged the Bangladesh government to soon take a decision that could save troubled textile sector, specifically when there are spinning mills involved, which are left with around Tk 120 billion worth of unsold inventory as the cheap yarn from India goes on to flood the market.
Showkat Aziz Russell, the BTMA president, told a press conference that the domestic spinning mills are indeed in dire straits due to this sudden spurt when it comes to low-priced yarn imports from India. There are many textile mills that are about to shut down because of faulty policy along with economic meltdown, he remarked.
It is worth noting that yarn imports from India saw a growth of 137% in the last fiscal year, thereby resulting in the closure of a minimum of 50 yarn mills across Bangladesh. Showkat was cited as saying by the domestic media reports.
He went on to accuse Indian traders of dumping yarn in Bangladesh at a price that is as low as $0.30 per kg.
Mohammad Ali Khokon, the former BTMA president, said that the rising operational costs along with a sudden spike in taxes have gone on to push mill owners to the brink which has led to voice out seeking to save troubled textile sector.
Apparently, in the last fiscal budget, the textile sector went ahead and paid 12.5-15% extra tax. In the budget when it comes to this fiscal year, it has jumped to 27%, Khokon said.
Khokon went on to confirm that yarn sales now are barely enough so as to cover labor wages and also gas bills, hence leaving no room for profit or even loan repayments for that matter, which, by the way, is forcing owners to shut down their factories.
He went on to caution that the collapse of the domestic textile industry would go on to have a domino effect on the readymade garment industry.
In the press conference, millers opined that they do not intend to completely ban Indian yarn. Instead, they advocated for decreasing the bilateral trade gap, which now heavily goes on to favor New Delhi.
They also went ahead and called for import bans on specific yarn types that are produced domestically and abundantly.