BGMEA demands 10% incentive on export of non-cotton garments

The garment makers have demanded 10 per cent incentive on export on garment items made from non-cotton fibre to encourage investment in manmade fibre (MMF).

Faruque Hassan, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), made the call in a letter to the commerce minister on August 21.

In the letter, the BGMEA president said last fiscal year Bangladesh imported 20.52 lakh tonnes of fibres, of which 93.57 per cent was cotton fibre.

Currently, 403 out of the 430 spinning mills operating in the country produce cotton fibre, he said.

So, the investment and production in the MMF-based fibre is still low although the potential is very high in the sector.

For instance, last year the global market of MMF-based garment industry was worth $150 billion.

Currently, Vietnam has 10 per cent market share in the MMF-based garment markets globally and the share of Bangladesh is still struggling to be 5 per cent in this segment, the letter read.

Of the global garment market, some 75 per cent are MMF-based fibre and this market is growing by 3 to 4 per cent annually. Of the 75 per cent MMF, some 64 per cent includes synthetic fibre, the letter said.

On the other hand, the global market share of cotton-based garment industry is growing only at 1-2 per cent.

As a result, Bangladeshi garment exporters have been losing the opportunity.

So the government needs to give at least 10 per cent incentive on export of MMF-based garment export to attract more investment in this segment.

Hassan also sent two different letters to the finance secretary and the governor of Bangladesh Bank on August 22 demanding loan rescheduling facility for up to December as the garment manufacturers and exporters have been struggling because of the pandemic.

In the letters, he also demanded not to classify the loans of garment sector for up to December this year so that they can be more competitive in the business.