BTMA wants withdrawal of decision to reduce export incentives

Bangladesh Bank has issued a notification on June 30, reducing the second cash assistance for all types of exports. This incentive was reduced on the pretext of LDC graduation. In this, cash assistance will be reduced to exporters in 43 sectors including ready-made garments, leather, jute, agriculture. Bangladesh Textile Mills Association (BTMA) has demanded the withdrawal of this decision to reduce incentives.

The trade association said that the FE Circular No. 12 issued by Bangladesh Bank should be withdrawn immediately and the cash incentives should be brought back to the previous status. Besides, BTMA has demanded to formulate an up-to-date textile policy for the textile industry in a quick time and keep a grace period of one year for repayment of bank loans.

The organization’s president Mohammad Ali Khokon made this demand in a press conference organized at the BTMA central office on Saturday (July 6). Meanwhile, BTMA vice-president Md. Fazlul Haque, Mohammad Faizur Rahman Bhuiyan and other members of the Board of Directors were present.

In the press conference, Mohammad Ali Khokon said that policy support or incentives are needed to make any industry strong or sustainable, which the developed countries of the world are also providing. Establishing sustainable industries for any country requires strong policy support and incentives. The way cash incentives have been reduced in our country without any kind of alternative mechanism will reduce capacity in the textile sector. As a result of this, the backward linkage industries of this sector will gradually be at risk of closure. Besides, we cannot survive in any way with other countries competing in this sector. If the primary textile is stopped due to some reason then the readymade garment industry will also gradually stop. This will cause the country’s economy to collapse.

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Stating that several factories in the textile sector have already been closed, the BTMA president said that many more factories may be closed at any time. In this situation, I demand immediate withdrawal of FE Circular No. 12 issued by Bangladesh Bank on June 30, bringing back the cash incentives, formulating an up-to-date textile policy for the textile industry and keeping a grace period of one year for repayment of bank loans.

In a written statement, he said that India is the second largest producer of cotton in the world and second in textile technology. India is currently the 5th largest economy in the world and despite graduating LDC in 2004, the textile industry has been providing cash incentives in various ways. Therefore, in the name of LDC graduation, the incentives and policy support of the textile industry of Bangladesh have been greatly reduced, and the way obstacles are being created in this industry, this industry will soon reach the verge of destruction.

About 1.5 million people are directly employed in the textile sector, Mohammad Ali Khokon said, indirectly, about one crore people are dependent on this sector. Those who are leading the Prime Minister and other top policy makers to the brink of destruction by giving wrong information about the textile industry and applying various pressures, actually want to turn this country into a foreign market.

He also said that the national budget for the fiscal year 2024-25 has been passed by the National Parliament. In this budget, there is no significant policy support for the textile and apparel sector and no measures have been put in place to protect this sector. After coming to power in 1996, Prime Minister Sheikh Hasina introduced a 25 percent cash incentive against exports for the textile and apparel sector. It has played a significant role in the progress of the textile and apparel sector of the country. As a result, export income in this sector has increased from 2 billion to 47 billion dollars.