Garment exporters oppose move to scrap duty benefit on yarn imports

Woven and knitwear garment exporters today urged the government to immediately withdraw the decision to impose duty on yarn imports, warning that the move would adversely affect apparel exporters.

The demand was made at a joint press conference organised by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) at the Pan Pacific Sonargaon in Dhaka.

The trade bodies, which represent the country’s biggest export-earning sector, held the press conference after the commerce ministry, in a recent letter, recommended that the revenue authority suspend the duty-free or bond facility on the import of 10- to 30-count yarn, a measure of yarn thickness that indicates fineness.

Under the National Board of Revenue’s bond facility, export-oriented industries are allowed to import raw materials duty-free on the condition that the finished goods are exported.

BGMEA Acting President Selim Rahman said the government could consider providing cash incentives to textile millers to protect the local textile sector instead of suspending the duty-free import benefit under the bonded warehouse scheme.

He suggested improving gas supply to textile mills so they can utilise their full production capacity and enhance competitiveness.

In addition, Rahman said rebates in corporate tax for export-oriented garment factories and easier access to bank loans could help reduce production costs and improve competitiveness.

BKMEA President Mohammad Hatem said any decision in this regard should be made by involving stakeholders from both the garment and textile sectors.