Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Mahmud Hasan Khan met with Honorable Commerce Minister Mr. Khandaker Abdul Muktadir at the Ministry of Commerce in a courtesy call and formal meeting today (Wednesday) at the Secretariat. He was also accompanied by Senior Vice President Enamul Haque Khan, Vice President Md. Shihab Uddoza Chowdhury and Director Md. Hasib Uddin, a press release said.
The meeting discussed in detail the various challenges facing the readymade garment industry in the current economic context of the country and the policy support required to ensure sustainable growth of the sector.
In the meeting, BGMEA President Mahmud Hasan Khan highlighted the current critical situation of the garment industry and said that due to the instability in the global economy and the impact of the Middle East war and the acute energy crisis of gas and electricity at the local level, the production of the garment industry is being severely disrupted. This has been coupled with the increase in the price of raw materials and increasing production costs. In order to survive in the international market during these difficult times, it is important to ensure strong policy support and a business-friendly environment from the government.
The meeting specifically discussed the current activities of the RSC (RMG Sustainable Council) and its role in addressing future challenges of the industry.
The BGMEA President highlighted BGMEA’s position on the mandate of the RSC in particular. Regarding the expansion of the scope of the RSC’s activities, he clearly mentioned that the RSC was formed only to oversee building, fire and electrical safety (OSH). Social compliance or ‘non-OSH’ issues such as wages, leave or trade unions are outside the core jurisdiction of the RSC. Repetition of such work will create additional administrative and financial pressure on the industry, which is not desirable in any way.
The BGMEA President made it clear that before taking any decision in this regard, it is necessary to ensure compliance with the owners and local laws.
In the meeting, the BGMEA leaders put forward several specific proposals for the sustainable progress of the garment industry, some of which are noteworthy:-
Simplification of import and bond policy: A demand was made to amend the current import policy to simplify the process of importing raw materials on FOC basis. In addition, a request was made to urgently amend Article 21 (8) (a) and Article 21 (8) (j) of the Import Policy Order to avoid the obligation of bond license in the case of supply of goods from bonded hidden exporting companies to non-bonded direct exporting companies.
Increasing financial and commercial capacity: BGMEA leaders called for the withdrawal of the existing 10 percent income tax deduction on cash incentives to encourage garment exports. In addition, it was requested to take effective initiatives to normalize trade relations with India and remove existing obstacles in yarn import and export of goods through land ports.
Trade Facilitation and CIP Status: In order to further accelerate the ready-made garment export trade, it was proposed to amend the relevant part of the ‘Import Policy 2024-2027’ and automate the criteria for determining CIP status of industrial entrepreneurs as per the proposal of BGMEA.
The Honorable Minister of Commerce listened to the issues raised by the BGMEA delegation with deep attention and acknowledged the importance of this sector, which is the country’s main foreign exchange earner in the current global situation. He assured to provide all necessary policy support to resolve the crisis in the garment industry and maintain Bangladesh’s capacity in the global market.
