Brakes on manufacturing

Abdul Hai Sarker. Photo: Amran Hossain

The gas and power situation has changed for the worse. The company had to cancel a substantial number of apparel orders from a top international brand as the factory's production capacity declined by more than 30 percent due to inadequate gas pressure. It is a story about Purbani Group.
The brand shifted orders to China from Bangladesh as Chinese manufacturers could ensure a timely delivery of high-end products, says Purbani Group Managing Director Abdul Hai Sarker in an interview at his factory in Kaliakoir, Gazipur.
However, top international apparel brands think Bangladesh is still a lucrative destination to place orders for the country's cheap and fine apparel items, Sarker says.
"In my group, the garments division has lost 30 percent of productivity and the fabrics division lost 60 percent over the last six months," he adds.
Sarker pointed to the gas and power crisis in industrial zones such as Savar, Ashulia, Kaliakoir and Gazipur.
He said like many other owners, he has been running the factory only for survival with hopes of good supplies of gas and power in future.
Woes aggravated when workers' efficiency lowered due to frequent power cuts and lower gas pressure, as they have to work unscheduled hours to carry out the orders in time.
Walking through different units of the factory, he says the quality of fabrics deteriorates when the machines stop halfway because of low gas pressure, leaving fabrics in piles.
Blotches appear on damp fabrics and it becomes difficult to separate colours in the dyeing process. The result is, all production goes to waste.
According to Sarker, when anything deviates from the normal process in industrial production, everything goes haywire and the cost of business ramps up.
He says he will have to pay the workers double when they work at off-hours, due to the shortage of energy during peak hours, even during poor business days.
"Profitability reached the lowest margin now, as I have to spend huge sums on new generators, bank interest, higher fuel costs and overtime payment to workers."
He said the generators do not run due to inadequate gas pressure and as a result, production at both the fabrics and garment divisions remains suspended for hours.
The company has to bear high bank interest rates regardless of whether production continues or not, Sarker says, adding that investors lose confidence and feel discouraged due to such unwanted energy crisis and labour unrest.
The gas pressure hits its lowest from 8am to 2pm, the main working hours for the day, Sarker says. Pressure starts improving from 6pm and the factory receives full pressure in the dead of night, but it is difficult to run production then, he adds.
The factory requires 10-PSI (pound force per square inch) gas pressure for spinning, dyeing and the finishing units to run at full capacity, he says. At present, Titas Gas Transmission and Distribution Company Ltd can supply near about 4 to 5 PSI, which is not enough to run production.
According to him, air shipment is the final solution for garment exports, as international buyers demand on-time delivery of goods. Otherwise, they cancel orders or place fines, he says.
Recently, the cargo village of Shahjalal International Airport has witnessed a rise in air shipments for apparel items because of delayed production in the factories for inadequate gas and power supplies, Sarker says.
Air shipment charges about $4 a kilogram, where transport costs via seaway for same quantity accounts for less than a dollar, he says.
Sarker says if businessmen ship goods by air, profitability reaches zero -- but it is needed to survive in the business.
Bangladesh's apparels sector has a chance at expansion by setting up new factories or BMRE (balancing, modernisation, renovation and expansion), but the government should first ensure continuous and an adequate supply of gas and power, he said.
Purbani generates 2.7 megawatts (MW) of electricity from two generators, but at most times, the generators also do not run due to insufficient gas pressure.
"Generally, our annual turnover is at Tk500 crore. This year, I am worried whether this turnover will be achieved or not, as I have to spend a lot of money to keep my business afloat," Sarker says.
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