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Exclusive Interview

New door for investment opens in textile sector

Former BTMA President tells

Published : Tuesday, 28 January, 2025 at 12:00 AM  Count : 482
Jibob Islam
New doors for investment have opened in the country's textile sector and the government must exploit the opportunity extending full cooperation to entrepreneurs so that they can utilize the new investment opportunities.

The government must do whatever it can to help the industry to survive in the competitive market.

A. Matin Chowdhury, former president of Bangladesh Textile Mills Association (BTMA) and Managing Director, Malek Spinning Mills Ltd; Rahim Textile Mills Ltd and about half a dozen textile firms, made the observation in an interview with the Daily Observer on Tuesday.

He said a powerful country has imposed sanctions on China; now controls one-thirds of the world's ready-made garment market curbing the US market. Bangladesh can easily utilize this opportunity provided that the government provides full support to entrepreneurs to exploit this opportunity.

To a question Matin Chowdhury said countries that have started working together in the textile and ready-made garment sectors have been successful and doing well. In Bangladesh, only a handful of people have started working together to gain from the new situation.

The remaining are working separately in the textile and ready-made garment sectors and that is why it has not been possible to achieve the desired success of the new opportunity. He said earlier workers wages were low, interest rate on loans was also low along with low gas price.

It lured many to invest in new textile mills. But in the last few years and particularly in last two years, gas price has increased almost three times and workers wages almost doubled.

Previously loans were available from Export Development Fund (EDF) at 2 per cent interest but now it has been closed. Bank interest rate is now above 14 per cent. In this situation, it has become quite difficult for textile sector to sustain.

A. Matin Chowdhury said some export orders are coming out of China; most of them are upper-grade jobs. We have to upgrade our skills to catch those jobs and the supply orders. So we have to be more trained and more modern. Especially to upgrade skills and catch up new jobs, training is needed; planning is needed and overall cooperation of the government is needed.

He also said, basically cotton cloth is made in Bangladesh. Polyester made clothes not. So the government cooperation is essential to switch to polyester made clothes and expand the business. But it is not possible to easily switch to making polyester clothes without support from the government. The work is difficult and more modern.

Polyester clothes making did not progress in Bangladesh for lack of training. On top of it, there was no policy for polyester made textile because the government for lack of the government cooperate in this sector.

He said, cotton work is easy but polyester work is difficult. Here entrepreneurs are more interested in investing in easy cotton made clothes. Moreover, the talent and knowledge that are needed to develop the polyester sector and go into production is largely absent here. Bangladeshi workers yet do not have that talent and knowledge.

To use polyester, you always have to be upgrading. We are interested in being satisfied with what we have. We are not interested in working hard to move from existing to the new. That is why the polyester sector has not progressed in Bangladesh. It was not possible to advance the use of polyester in textile sector, he said.

To another question on industrialization, Matin Chowdhury said, to expand industrialization, the supply system must be uninterrupted reducing gas price. The supply must be uninterrupted by reducing electricity price. If gas and electricity price cannot be reduced, the supply system can't be uninterrupted.

He said, to accelerate exports, low cost working capital is a must at low interest rates to survive in the competitive market.

Moreover, workers' dissatisfaction must be addressed. If there is a problem in one factory, the government must take initiatives to stop it is spreading to other factories across the streets.

He also said, the law and order situation must be kept normal by maintaining a peaceful environment. In short, an investment-friendly environment must be maintained; infrastructure sector must be developed. To another question on investment situation, A. Matin Chowdhury said, with high tariff embargo on Chinese export, a huge investment opportunity has been created in Bangladesh. The government must come forward to utilize this opportunity.

However, many domestic and foreign investors are refraining from investing despite the investment opportunities in the current situation. The government must encourage them so that they are interested in investing.

He said deterioration of law and order, increase in bank interest rates and gas and electricity crisis have had a negative impact on investment. In addition, controlling labor unrest, reducing bank rates and normalizing gas and electricity supply will encourage entrepreneurs to come forward to invest.

He also said, Chinese investors are looking for a safe environment. Hose investors must be encouraged to invest in Bangladesh addressing their concerns. The government must take appropriate steps in this regards. Opportunities do not come again and again. It would not be right to miss this opportunity, he said.

He said when an elected government will take power and adopt a long-term plan - then entrepreneurs will feel more encouraged. At that time, the government must take positive steps to address the shortcoming.

The government must provide incentives, reduce interest rates on bank loans, develop infrastructure and maintain normal law and order so entrepreneurs can feel secured and survive in a competitive market, A. Matin Chowdhury said.



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