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BTMC in loss despite rising demand for yarn, fabrics

02
Dec '11
The Bangladesh Textile Mills Corporation (BTMC) has been incurring losses every year despite the rising demand for yarn and fabrics in the country.

During the last ten years, the demand for yarn and fabrics has been considerably increasing in Bangladesh, and the private sector in the country has been meeting nearly 65 percent of the total demand, with the remaining being met through imports, according to a latest study released by the Ministry of Textiles and Jute (MoTJ).

Over the same ten year period, the BTMC has incurred a loss of more than Tk 6 billion. Of this, the highest loss of Tk 706 million was seen in fiscal year 2002-03, while the lowest loss of Tk 463 million occurred in 2008-09. In 2010-11, BTMC made a loss of around Tk 486 million.

The MoTJ study reveals that Bangladesh's average annual demand for cotton yarn is 1,872 million kg, out of which 951 million kg is procured domestically and the remaining 921 million kg is imported.

The demand for fabrics in the country is 5,612 million metres annually, which is expected to go up to 7,164 million metres by 2015, the study adds.

At present, there are 1,058 cotton and textile mills in Bangladesh, of which, 1,036 mills are owned by the private sector, and only 22 mills are under BTMC. Over a period of time, BTMC has sold more than 60 mills to the private sector.

“The BTMC has been incurring loss because of many factors like revised Government laws and policies, increased rate of interests from the banks and outdated machineries,” Brig. General Mahmood Ul Alam, Chairman, BTMC, told fibre2fashion.

“Actually, the Tk 6 billion loss has been accumulated over a period of time due to a lot of affecting factors. Currently, we are working towards raising funds to accommodate salaries, electricity bills and other expenses,” he added.

Informing about revival plans, Brig. Alam said, “BTMC is currently working on modernization and renovation of its remaining mills and trying to revive them. We will be removing the outdated machineries to compete in the market. Since we cannot completely throw away these machineries, we have worked out certain modalities and will see to it that the loss that we are incurring will be minimized.”

“Secondly, we are trying to utilize our assets to the highest level. We are looking forward to synergize between the private and public sectors, where we offer our assets and work out the modalities. Another thing that we are trying to work out is that there are huge areas of some old land which are presently lying unused. We are making a textile village on that land. We can have small industries developing on that land and then we will be creating about 20 blocks on that land so that 20 industries can develop in the private sector, he reveals.

The BTMC Chairman suggested, “We have a long accumulated amount of debt, so the Government can help us in a way that they can waive-off the interest on our debts and we can pay the principal amount sector-wise and come out from the loan.”

Fibre2fashion News Desk - India


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