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The Southern India Mills’ Association

Committed to Foster the Growth of the Textile Industry

RMG backward linkage could flourish under govt support’

The garment sector is playing a great role in development of Bangladesh, but export dependency on a particular sector is not good for the country Garment accessories and packaging manufacturers have called on the government to provide them with long term policy support including cash incentives and equal corporate tax for the backyard linkage industry to enlarge direct export.
They also urged the government to declare garment accessories and packaging products as the product of the year for 2019. Leaders of garment and garment accessories and packaging manufacturers came up with the demands while addressing the inaugural ceremony of the ninth edition of Garments Accessories and Packaging Exposition (GAPEXPO-2018) in the capital on Wednesday.
Finance Minister AMA Muhith inaugurated the four day expo as chief guest, and BGMEA president Siddiqur Rahman was present as special guest. Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) organized the four-day international expo on garment accessories to showcase the latest products, machinery and raw materials to attract buyers.
The show is being held at the International Convention City, Bashundhara (ICCB) in the capital till Saturday. “In the course of time, Bangladesh has turned into a sourcing hub for garments products. These days, garment accessories and packaging manufacturers have also started to export directly,” BGAPMEA President Abdul Kader Khan said.
“Despite having a large contribution to the total export of the country, we are deprived of cash incentives, while the manufacturers have to pay 35% corporate tax even though the RMG exporters pay 12%,” said Kader. Urging the government to provide cash incentives and to cut the corporate tax, Kader said: “If the government provides equal facilities and policy support, we will be able to contribute $12 billion to export earnings by 2021.” The industry has the ability to meet over 95% of local demand, and is now exporting to some other countries, BGAPMEA leaders said. In the last fiscal year, deemed export earnings of garment accessories and packaging stood at $6.70 billion, which is 9.47% higher compared to $6.12 billion in FY16.
“Accessories and packaging goods are the heart of apparel industry,” Exporters Association of Bangladesh President Abdus Salam Murshedy said. The government has given authority to issue Utilisation Permission (UP) to BGAPMEA but it is not implemented, he said. If it is implemented and the sub sector gets policy support, the capacity of the sector will increase manifold and it will help the manufacturers to export more directly, said Salam.
The garment sector is playing a great role in development of Bangladesh, but export dependency on a particular sector is not good for the country, said AMA Muhith. “When the sector started business, the sector was import dependent. Now, the sector produces about 50% to 60% and the credit goes to sector people,” said the minister.
It is good that the manufacturers create markets and export, he added.
In response to the business people call, the minister said, that the government has created a business friendly environment to do business and provide all the support needed. A total of 278 companies from 17 countries including Bangladesh India, Sri Lanka, China, Taiwan, Malaysia, Vietnam, Singapore, Hong Kong, Thailand, Japan, South Korea, Germany, Italy, France, USA and Turkey will participate to display garments accessories and packaging items with machinery, all kinds of garments machinery with boiler and spare parts.