The Bangladesh Textile Mills Association on Saturday termed discrepancies in export figures as a ‘conspiracy’ against the apparel and textile sector, claiming that a group influenced the government to reduce cash incentives by showing inflated export growth.
A section of people are providing misleading information to the prime minister and policy makers to cut benefits for the textile sector, aiming to turn Bangladesh into a market for foreign yarns and fabrics, BTMA president Mohammad Ali Khokon alleged at a press conference held at the office of the trade body in the city.
He demanded the continuation of cash incentives at the previous rate saying that reduction of cash incentives would severely jeopardise the country’s textile industry.
Khokon urged the government to withdraw a circular of the Bangladesh Bank issued on June 30 which reduced the cash incentives for the apparel and textile sectors by 50 per cent.
Regarding the inflated export data, the business leader said that the BTMA raised this issue at a recent Bangladesh Bank meeting, highlighting that export figures were being reported higher than reality upon which BB governor reprimanded them.
During the meeting, the BB claimed that, despite growth, exporters and textile millers were reporting lower growth figures, Khokon said.
Now it has been revealed that the exports were indeed lower, the BTMA president said.
The Bangladesh Bank on Wednesday revised the country’s export earnings data downward by over $12 billion for the July-April period of the 2023-24 financial year.
Although the central bank reduced cash incentives showing the country’s upcoming graduation from least developed country status in November 2026 as an excuse, there are still about two and a half years left, Khokon said.
At the same time there was scope to continue cash incentives for an additional grace period of three years until 2029, the BTMA president said.
Khokon said that the government had reduced the cash incentives at a time when the industry was facing several challenges, including acute shortage of gas despite a 250 per cent price hike, high bank interest rates and increased wages.
The cut in export incentives could hinder the progress of the apparel and textile sector and potentially lead to its downfall, similar to the jute sector’s decline, he mentioned.
Citing India as an example, Khokon said that the country graduated in 2004 and had been providing various policy supports and incentives to its textile sector as an alternative to cash incentives.
Khokon expressed concerns that without alternative measures, the cut in incentives would lead to a loss of competitiveness and put textile mills at risk of closure.
He demanded the reinstatement of cash incentive supports at the previous rate until alternative policy supports were in place.
He also called for a timely textile policy, highlighting the policies the Indian government had implemented for its textile and garment industry as well as a one-year grace period for the repayment of loan.
BTMA vice-presidents Md Fayazur Rahman Bhuiyan and Md Fazlul Hoque, among others, were present in the event.