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Indonesia imposes tariff on apparel from Bangladesh

Indonesia puts safeguard duties ranging from $1.33 to $4.34 on RMG and accessories products from Bangladesh and other countries. But exempted eight items of headwear and neckwear.

Entered into force on 12 November 2021, the duties, which will remain for three years till November 2024. This tariff rate will be pertinent for the first year. For the second and third years, the rate will be $1.26 – $4.12 and $1.20 – $3.91 respectively. A World Trade Organization (WTO) notification said on 17 November.

Indonesian-market-imposes-tariff-apparel-Bangladesh
Figure: Indonesia imposes safeguard duties on Bangladeshi RMG goods.

Bangladeshi RMG leaders consider Indonesia a potential market due to its population mass; whereas additional imposed duties will only put a burden on the export.

The recent export data shows that Bangladesh exported $34 million in the Fiscal Year 2020-21 which was around $29 million in FY20. And textile goods exported to Indonesia were worth around $7 million in FY 21 and around $3 million in FY 20.

Sahidullah Azim, Vice-President, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) tells media that Comparing the recent growth rate, Indonesia is a promising market for Bangladesh, but the imposition of recent duty will hamper export.

He called upon the government to immediately take steps through the diplomatic channel to grab the market.

“If we are able to sign FTA or PTA, it could be helpful for good export earnings from Indonesia,” added Azim.

Md Hafizur Rahman, Director General, WTO Cell under the Ministry of Commerce, however, said to media, “Before the duty was slapped, the ministry discussed the issue with the World Trade Organization (WTO).”

“Even we tried to negotiate on the issue with the Indonesian government, but to no avail. They imposed it on all countries,” Hafizur added.

Switzerland based on The World Federation of the Sporting Goods Industry (WFSGI), said that Indonesia had violated WTO rules to impose the safeguard measures.

The WFSGI said, “Even though KPPI in its questionnaires requested interested parties to provide data for the periods January to June 2019 to June 2020, it then completely ignored the data and based its analysis on the period of 2017-2019.”

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

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