Tk 3,500cr yarn, fabrics pile up in mills
Yarn and fabrics worth Tk 3,500 crore have piled up in some 250 spinning and weaving mills because of the ongoing movement restriction to curb the spread of coronavirus.
These millers manufactured the yarn and fabrics targeting two upcoming festivals Pahela Baishakh and Eid-ul Fitr, Mohammad Ali Khokon, president of Bangladesh Textile Mills Association (BTMA), said in a letter.
The affected millers mainly produce yarn and fabrics for the local market, Khokon said in the letter, which he prepared to submit to the finance ministry and other government offices next week.
This year, the government imposed a ban on large gatherings to celebrate the first day of the Bangla calendar, when clothing items worth around Tk 1,500 crore is sold, Khokon said.
The millers may miss both the two major sales events this year, as the government may curtail the celebrations of Eid-ul Fitr also, he said.
Of the 450 BTMA-member spinning mills, 250 were in a fix, as they produce fabrics and yarn for products such as lungi, sari, salwar kameez and fatua.
The situation was the same for 500 of the 850 weaving mills which produce fabrics for the local markets.
This has trickled down on some 200 units of dyeing and finishing mills which mainly serve these spinning and weaving mills, Khokon said.
The spinning and weaving mills, which produce raw materials for the export-oriented garment sector, can benefit from the government's Tk 5,000 crore stimulus package.
Some 1.5 million people have been directly affected from the drop in sales in the primary textile sector, Khokon also said.
In the letter, he demanded withdrawal of VAT on all kinds of yarn and fabrics sold between March 20 and June 30 this year.
He also sought exemption of interest on term loans for six months and extension of term loan repayment period by two years for the affected millers.
He demanded enabling payment of utility bills like gas and electricity for the next six months starting from March in 12 monthly instalments while withdrawing associated VAT, interest and surcharge.
He also demanded that the government facilitate duty free import of textile dyes and chemicals until June 30 this year.
The BTMA chief also urged the government for withdrawing all demurrage fees for imports at the Chattogram port between March 20 and June 30 this year.
Meanwhile, local garment accessories makers have urged the government to include them in the list of beneficiaries of the stimulus package.
With the work order cancellations by the buyers, the accessories sub sector is also affected, said Abdul Kader Khan, president of the Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA), in a statement yesterday.
More than 1,700 BGAPMEA members meet nearly 95 per cent of the demand for accessories of the garment industry and help reduce import dependency for accessories of the export-oriented sector, including the garment sector.
Khan said the accessories and packaging sector was one of the main export oriented sectors that was supporting other export-based sectors in producing their finished products.
AKM Salim Osman, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), in a statement yesterday said the association's member factories would be able to run their units after April 4 while ensuring adequate health safety measures for workers.
Earlier, Osman in a statement asked all the BKMEA members to shut factories down in line with the government announcing a 10-day general holiday from March 26.
The BKMEA also strongly suggested its members clear workers' wages for March in time to avert any labour unrest.
Meanwhile, the commerce ministry has withdrawn the ban on export of face masks and hand sanitisers from Bangladesh.
The ministry in a statement said the office of the chief controller of imports and exports passed the order in a circular yesterday.
Earlier, the ministry imposed a ban on export of face masks and hand sanitisers until March 12, according to the statement.