Bangladesh Textile Mills Association has demanded the government to extend the usance period for payments on the import of industrial raw materials.
In a letter to the governor of Bangladesh Bank on January 13, the BTMA said that the export oriented textile industry had been facing problems because of the expiry of a circular of the central bank which had extended the usance period for payments.
The letter referenced a Bangladesh Bank circular that had extended the payment period for imports of industrial raw materials from 180 days to 360 days, with this arrangement set to remain in place until December 31, 2024.
In foreign trade, ‘usance’ refers to the permissible period between the date of the bill and its payment, as allowed by customs.
BTMA letter, signed by its secretary general Md Zakir Hossain, said thatt export-oriented textile mills have incurred exchange rate losses due to the depreciation of the taka against dollar.
The letter also said that mills were unable to operate at full capacity due to a combination of factors, including shortages in gas and electricity supply, increases in gas prices and workers’ wages, as well as recent political instability and labour unrest.
It also mentioned that the BTMA represents 1,850 primary textile mills, encompassing spinning, weaving, and dyeing-printing-finishing sectors, with a total investment of approximately US$ 22 billion.
Terming the textile industry an import-substitute sector, the letter said that the industry supplied 70 per cent of the country’s textile and apparel export earnings requirements.
Given the overall situation, the letter emphasised the urgent need to reinstate the extended credit period for payments related to the import of industrial raw materials, and requested that necessary measures be taken in this regard.