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Garment waste cloths: a potential export sector

Bangladesh Textile and Garments Waste Processors and Exporters Association (BTGWPEA) in a recent application sent to the Ministry of Commerce said that garment waste can be an export sector with huge potential. However, incentives need to be given by the government to encourage the export of this sector.

Beximco-Recover-textile waste
Figure: Garment waste can be an export sector with huge potential.

BTGWPEA does not have any statistics on the amount of garment waste produced in the country. However, last November, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Faruque Hasan said in an event that four lakh tons of garment waste is produced annually and there is a possibility of earning 3 billion dollars per year from this.

According to BTGWPEA sources, many of the 60 members of the association export garments waste to European countries along with India, China, the USA and Turkey. The average export for the last five years is 50 to 60 million dollars.

BTGWPEA president Syed Nazrul Islam told to media that 30 percent of the garment waste produced in the country comes from cotton garments. The rest of the garment waste comes from polyester and polyester-based apparel products.

There is a huge demand for synthetic fiber garments made by the world’s big brands and consumer organizations. As a result, the production of clothes made from synthetic fibers is also increasing. The global market for synthetic fibers is also very large.

Although Bangladesh is the second leading country in the world in the export of manufactured garments, Bangladesh is behind Vietnam in the export of synthetic fiber garments. Vietnam accounts for 10 percent of the world’s synthetic fiber garments, while Bangladesh’s share is close to 5 percent. Neighboring India exports synthetic fiber garments worth about $1.6 billion.

According to BTMA, currently, around 80 textile mills are producing various types of synthetic fiber yarns and fabrics including polyester, viscose, tensile, and modal. However, in 2016 the number was less than 50.

According to Nazrul Islam, if there are incentives and good supervision of the government, this sector can earn 10 billion of dollars. Meanwhile, traders want subsidy on export of surplus cloth from garment factories.

On Wednesday, the Ministry of Commerce held a meeting under the chairmanship of the Additional Secretary of the Ministry of Commerce, Abdur Rahim Khan.

Sources said that the meeting held initial discussions on the issue, but more meetings will be held later. After that, the Ministry of Commerce will send a letter to the Ministry of Finance recommending export subsidies to them. It will depend on the attitude of the finance department whether to give export subsidy or not.

BKMEA Executive Director, Mohammad Hatem participated in the meeting and told to media that besides giving subsidies to some new products, the government should simplify the process of giving subsidies.

According to the circular of Bangladesh Bank, the government is currently providing cash subsidies at various rates ranging from 2 to 20 percent to exporters of goods in 37 sectors.

The officials of the Ministry of Commerce said that giving export subsidies to any new product will not be the sole decision of the Ministry of Commerce. Finance department, Bangladesh Bank and National Board of Revenue (NBR) are also involved in this regard. The Ministry of Commerce can and will make recommendations in this regard.

If anyone has any feedback or input regarding the published news, please contact: info@textiletoday.com.bd

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