Bangladesh textile industry leaders call on government to change

The budget for the 2011/12 fiscal year (July -6) included a rise in the clothing and clothing tax from 0.4% to 1.5%. The Bangladesh garment manufacturers and Exporters Association said the increase was as high as 275%.

MohammadShafiulIslam, chairman of the association, said: "we urge the government to fix all export oriented textiles tax by 0.25%, replacing 1.5% of the proposal.

Such a large increase will impede the development of the garment industry, and export targets will be difficult to achieve.

The People's Republic of Bangladesh

"Without raising cash incentives, we will not be able to compete with our main competitors, such as China, India or Pakistan," he said.

Insiders say that in recent months, the government has increased the prices of natural gas, electricity and fuel, which greatly affected the development of the garment industry.

The United States and Europe are the main destinations for Bangladesh's exports, but the US and European economies are still fragile, so industry insiders expect the recent decline in exports to the United States and Europe.

In addition, the government of Turkey will impose a 17% special tariff on imported garments starting next month, which may seriously affect Bangladesh's exports.

In the financial year ending in late June 2010, Bangladesh clothing exports to Turkey amounted to US $650 million.

The leaders of the two associations also requested that the duty-free tools be extended to 2015 instead of 2013, so as to help the garment industry achieve an annual export performance of US $18 billion, and the garment industry employs about 5 million 500 thousand workers, most of whom are women.