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Coronavirus fallout: Millers meeting local clothing demand seek fund support

BTMA writes to finance ministry for a bailout package for them


| Updated: April 04, 2020 18:10:32


Coronavirus fallout: Millers meeting local clothing demand seek fund support

Textile mills those are meeting the local clothing demand have sought a bailout package as they could not sellout their products due to the ongoing shutdown amid coronavirus outbreak.

Textile fabric and yarn worth TK 35 billion remain stockpiled at these mills, resulting in liquidity shortage and not being able to pay the workers.

They said the export-oriented mills would be benefitted from the government-announced Tk 50 billion fund, but they would have to suffer a lot unless there is a fund support from the government.

There are more than 250 spinning mills and 500 weaving mills in the country meeting the local clothing demand.

Meanwhile, Bangladesh Textile Mills Association (BTMA) in a recent letter to the finance ministry made a five-point demand to overcome the problem.

It said that businesses have been suffering from an acute shortage of liquidity as the business activities remained halted.

In his letter, the BTMA president Mohammad Ali Khokon said the textile mills those meet most of the local people's clothing demand are now sitting on a stockpile of fabric and yarn worth Tk 35 billion.

The Pahela Boishakh celebration has also been postponed, he said, explaining that the local millers remained busy before the festival that creates a Tk 15 billion market.

Besides, because of the extension of public holidays, the local mills remained closed and business activities are halted, Mr. Khokon said. He added that they are suffering from an acute shortage of liquidity, as a result.

Without support from the government, the factories would not be able to pay wages to their workers due to the suspended business activities during the Boishakh season, he said.

According to the BTMA, livelihoods of more than 1.5 million people are dependent on the sector directly and indirectly.

The BTMA urged the finance ministry to prepare a bailout package, including withdrawal of value-added tax on yarns and fabrics from March 20 to June 30 to protect the spinning, weaving, dyeing and finishing mills.

It also demanded interest waiver on term loans for six months and extend the repayment period by one year with a six-month moratorium facility.

The BTMA demands included a block account facility on utility bills for a period of six months and interest-free payment facility of the amounts in next 12 months.

The trade body proposed providing a tax-free facility in importing all types of dyes and chemicals for the textile dyeing and finishing industry until June 30.

It also demanded waiver of port demurrage and depot charges on imported raw materials until June 30.

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