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Reduction in duty drives import of textile machinery
08
Aug '08
Following a reduction in duties on import of capital machinery and spare parts and the introduction of 1 percent procedural fee, Bangladesh imported textile machinery worth Tk450 crores in the month of July.

Replacing the earlier indemnity bond system, the Government reduced duty on import of capital machinery from 5 to 3 percent, which was a great relief to the textile industry.

According to Bangladesh Textile Mills Association (BTMA), in the month of July alone, a total of 175 units of machinery were imported by the country, 90 percent of which were for the spinning mills.

Sources informed Fibre2fashion that reforms in procedural policies and import duties have tremendously helped increase the import of machinery most of which are being bought by the new industrial units being set up to meet the growing international demand for local textile products.

For instance, Noman Group has decided to set up new dyeing, weaving, spinning, and finishing units as well as a fashion house. Likewise, a number of other enterprises are importing machinery for supporting their respective expansion plans, especially since appreciation of Chinese currency against US dollar has thrown open new opportunities for domestic industrialists.

Most of the machinery imported, goes in to backward integration of the industry. This in turn has helped the vibrant RMG sector to source most of its raw materials from within the country. The knitwear sub-sector obtains 80 percent of raw materials from the local market, while the woven sub-sector on the other hand is able to source nearly 40 percent of its requirements locally.

Moreover, it has been reported that of the total imports of capital machinery, nearly 70 percent have been purchased by the textile and readymade garment sector and if the Government can ensure a steady supply of gas and power to factories, this number would go up significantly.

Fibre2fashion News Desk - India

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