EPB moves on duty-free garment export to India
Export Promotion Bureau (EPB) is taking some initiatives to encourage apparel manufacturers to fully utilise the opportunity of exporting eight million pieces of readymade garment (RMG) products to India a year under a South Asian Free Trade Area (Safta) agreement.
The EPB will send letters to Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) soon so the apparel manufacturers make the best use of the opportunity.
Bangladesh could export only three million RMG pieces to India under the quota in 2008.
"Of the last year's eight million quota, Bangladesh so far exported three million pieces of RMG and the rest remained unutilised," said Shahab Ullah, EPB vice chairman.
He said India may also import this year the rest five million pieces allocated for 2008 as the EPB earlier sent letter to the Indian side in this connection.
"So Bangladesh may have the opportunity to export a total of 13 million pieces this year," Shahab Ullah said.
As the exporters refrained from grabbing such an opportunity blaming some non-tariff barriers (NTBs) from Indian side, the BGMEA has relaxed some of its rules earlier to encourage them to take the advantage and meet the deadline.
After finalisation of the agreement, BGMEA and BKMEA were instructed to issue certificates only on the basis of letters of credit, but the trade bodies started issuing certificates in line with the contracts signed between the Bangladeshi exporters and Indian importers, the EPB official said.
Talking to The Daily Star a local buyer said the exporters do not feel encouraged to send RMG products to India mainly for two reasons -- delayed payment and frequent changes in fashion in India.
A senior BGMEA official said the response is so far good this year. "The pace of issuing certificates this year is stronger than last year. I hope the full quota of eight million pieces will be fulfilled this year," he said.
Under the Safta deal signed in September 2007, India will import eight million RMG pieces per annum allowing a zero tariff facility for Bangladesh.
Of the total quota, affiliated BGMEA members will get a 70 percent share, while BKMEA members will have the rest.
According to guidelines, all applications of intending RMG exporters must be forwarded to the EPB through BGMEA and BKMEA.
An apparel unit owner will get allocation for supplying as high as two lakh RMG pieces a year after submission of required documents, including confirmed irrevocable letter of credit.
According to EPB data, Bangladesh exported knitwear products worth US$8.99 lakh and woven products worth $4.094 million to India in fiscal year 2007-08.
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