Bangladesh : BTMA urges govt to re-adjust energy charges

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BTMA urges govt to re-adjust energy charges

28
Nov '12

Mr. Jahangir Alamin

Calling on the Government to take wise measures to re-adjust the energy prices, Bangladesh Textile Mills Association (BTMA) president Jahangir Alamin said abrupt rise in energy charges may badly impact the country’s textile sectors, which is considered to be a key stimulator of the nation’s economy.

At a media briefing, Mr. Alamin said Bangladesh has a potential to largely draw the investment from China, where production has almost halved due to high wages. Chinese investors are looking at shifting their industries to Bangladesh, however high cost of energy and high interest on bank loans are impeding their way.

He added that the Government is planning to increase the energy rates by 104 percent, which is likely to annihilate the textile industry which operates with 1200 mega watt captive generation.

Noting that the weaving segment of the textile industry necessitates large-scale investment to cater to the rising demand of the garment sector, Mr. Alamin said the abrupt rise in energy charges and high bank rates are blocking investments.

While in 2009, the textile sector in Bangladesh attracted investments of Tk 10.7 billion, the volume reduced to Tk 0.99 billion in 2010 and 2011, due to increased energy cost and high interest rates on loans which now prevails at over 18 percent, he said.

Appreciating the Government for the part played by it in development of the textile sector, the BTMA chief specifically highlighted the five percent cash incentive scheme introduced by the Government when the global cotton prices were rising at unusual pace.

He said high bank rate and spiralling energy charges would hold back the overseas investors from investing in the domestic weaving sector, which is already impacted by the one stage GSP facilities.

Mr. Alamin requested the Government to re-adjust the energy charges, as around €3.15 billion has been invested in the textiles sector, which directly and indirectly employs around two million people.

Fibre2fashion News Desk - India

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