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“Loan repayment extension and interest reduction are pre requisite to ease BD’s RMG”

Syed Nazrul Islam, Director of Well Designers Ltd, is serving as the 1st Vice President, BGMEA who recently has been elected from the Sammilita Parishad panel. Syed Nazrul Islam was born 20 April, 1972 to a renowned Muslim family. From childhood, the visionary leader showed a great sense of responsibility and leadership. With more than 20 years of experience, the leader has a proven record of accomplishment of leading from the front in critical times.

Previously, Nazrul Islam guided the textile and apparel industry in critical times as a BGMEA member i.e. the Tazreen Garment fire or Rana Plaza incident. After completing his MBA degree from Newport University, Bangalore in 1999, he joined his family business in 2001 and became the Director of Well Group, a leading organization in Chattogram and Bangladesh.

He started a garment business only with 120 machines and now he has upgraded it to 3,000 machines, where 8500 workers are employed.

Recently, in an interview with Textile Today he shared his thoughts regarding the current challenges and plan to reshape the apparel industry.

Syed-Nazrul-Islam-1st-Vice-President-BGMEA-Well-Designers-Ltd
Figure: Syed Nazrul Islam, 1st Vice President, BGMEA & Director of Well Designers Ltd.

Textile Today: Our textile and apparel industry is going through many challenges due to the rise of COVID-19, what is your plan to reshape the apparel industry by holding the BGMEA first Vice President post?

Syed Nazrul Islam: At the outbreak of COVID-19, the world was brought down to its knees. Likewise, fashion and apparel is no exception, the pandemic forced people to stay at home and retail stores closed around the world, the demand for clothing has plunged.

Shrinking the global apparel market size significantly. Creating a profound long-term wound further down the supply chain. During the first wave of the pandemic, Bangladesh’s textile and apparel industry felt the heat due to raw material sourcing challenges and around $3.18 billion canceled orders from most global buyers, delayed payments, or forced unlawful discounts.

As a result, Bangladesh’s apparel industry caught off-guard and faced various challenges including a significant number of factories had idle capacity, some were forced to shut down, a significant number of workers, staff lost jobs. Lack of work orders led entrepreneurs in failing to pay the bank loans, bank interests, and workers’ wages.

The Prime Minister is very sincere about our cause. As she dispatched an economic package for the sector. Which helps to sustain the industry. However, the global market has not recovered yet, our capacities are sitting idle but we are paying for the fully functioned factory.

Without enough orders, entrepreneurs could not pay the bank loans and bank interests. Meaning, in this critical time, the government and the other financial institutes need to stand by the textile and apparel sector to overcome the financial challenges and job uncertainties. We are hopeful again that the govt. will ease apparel makers’ challenges and aid us. Extending the loan payment tenure is necessary to bounce back.

Reshaping the industry

The performance of the readymade garment (RMG) industry is most critical for Bangladesh’s economy since textile and apparel contributes 84% of the country’s export. While the overall employing close to 40 million people. And we are striving to achieve a $50 billion RMG export.

In terms of reshape/re-shuffle, the COVID-19 has made tomorrow unpredictable. As the vaccination campaign is picking up globally, so, within a year, we hope that things will get better and the RMG business as well.

One vital nature of our garment industry, since its inception in the ’80s, apparel entrepreneurs systematically build this sector with the profit they made. Entrepreneurs always rose to the various challenges and invested to achieve today’s position. Factory owners reinvested the profit they made to make it the biggest foreign currency earner of the country.

Bearing all these, bank interest is still in double digits. Which must be lowered to a single digit, if we want to progress the sector. In addition, the extension of loan and interest payment terms is paramount. These critical challenges must be overcome to regain momentum and reshape it.

The government must keep a close eye regarding giving out financial aids. As unfortunately, in the name of garments, some corrupted people got financial aid and laundered a big amount. We urge the government to stop this.

If we get aid from all concerned, the overall textile and RMG sector will recover. In addition, we are hopeful that within 2022, Bangladesh’s apparel will get back on its feet through a holistic approach and cooperation.

Textile Today: The apparel consumers are moving more towards value-added apparel made of synthetic fabric. Subsequently, with industry 4.0 the industry is rapidly adopting automation. What are Bangladesh’s prospects in product diversification and automation?

Syed Nazrul Islam: As I said, entrepreneurs reinvested the profit to bring the RMG industry into the second largest apparel exporting country. Whereas, making value[1]added synthetic apparel or adopting automation needs huge capital investment. Except for bank loans and government support, it is not possible for the RMG industry to expand into these areas.

As the first Vice President of BGMEA, it will be my top agenda to lower the bank interest rate to pave the way for product diversification and automation. It is high time, that banks become more investment-friendly and the govt. aid.

Which will enable Bangladesh apparel as well as the backward linkage industry capable to produce high-end apparel. Then product diversification, value-added apparel manufacturing and automation will be possible.

Textile Today: Besides getting smaller orders in recent times, Bangladesh’s product price is also reduced compared to other RMG manufacturing countries. How can we get the right price?

Syed Nazrul Islam: Regarding price bargains, we do our best to negotiate with the buyers. However, we have to keep our apparel price competitive compare to other RMG manufacturing countries to attract buyers. Although our labor cost is comparatively low, we cannot enjoy this benefit.

As we have some mammoth challenges like high overhead costs and other various hidden costs lose the edge. Issues like high transport cost, poor roads & highway, corruption and bribe in every step add challenges for us.

These obstacles need to be dealt from the govt. policy level to make the ‘Made in Bangladesh’ RMG competitive.

Textile Today: Over 92% of imports and exports of goods are processed through the Chattogram Port; it is also responsible for processing 98% of containers in Bangladesh. How does the COVID 19 pandemic affect the port activities and overall supply chain?

Syed Nazrul Islam: Buyers prefer faster lead-time, having a smooth supply chain is critical to ensure a quick delivery. Nevertheless, supply-chain is very disruptive due to various obstacles.

Not just port delay, the customs clearance takes much longer than necessary. In recent times, Chattogram Port’s capacity has increased a lot. But there are other factors like obtaining bank papers, customs house clearance, bond commissioner office creating hindrance. Which I think can be reduced if the concerned bodies take sincere effort.

BGMEA’s current body and ex-presidents are meeting with all the bodies regularly to reduce this 7 days’ timeframe. We are closely in discussion with customs and port authorities to speed up the process. I hope that it will be solved soon.

Textile Today: After the Rana Plaza collapse you worked a lot for the industry, how do you see the progress of the apparel industry? Could we position it rightly in our market?

Syed Nazrul Islam: The Rana Plaza incident was a wake-up call for Bangladesh’s apparel industry. Following the incident Alliance and Accord came here in Bangladesh that led the industry into a greater reshaping and now in terms of workplace safety, we are one of the safest apparel manufacturing industry internationally.

We have 135 LEED-certified factories – including 39 Platinum factories. Moreover, 500 more factories in the certification pipeline. Now, buyers and consumers feel confident about our industry standards.

Textile Today: Is it possible to bring coordination among BGMEA, BKMEA, BTMA, BGAPMEA, BGBA, etc. to move the industry “as a whole”? How this coordination can bring benefits for the industry, and how this coordination can come in reality?

Syed Nazrul Islam: In light of the challenging global business climate, there is no alternative other than collaboration among all the stakeholders and associations like BGMEA, BKMEA, BTMA, accessories sector, printing, washing, etc.

Under the leadership of Faruque Hassan, President, BGMEA, and as the serving first Vice President, all the textile leaders are liberal and we sit regularly to unite our cause to create a unified policy.

This cooperation will play a crucial role in creating a smooth future for this industry. There is no alternative other than all the stakeholders and associations to combine their effort to focus on our goals.

Textile Today: How was the journey of Well Group Ltd? Is there any new investment plan in near future? In which area do you want to expand?

Syed Nazrul Islam: My elder brother Abdus Salam started this journey. Currently, in garments alone, we have more than 8500 workers. We always prioritize the wellbeing of our workers and since the beginning, Well Group always put workers first.

We are careful about adopting automation, as it will reduce the workforce. Which we do not prefer. Following the global trend, we have to go for automation but we maintain a critical balance to keep our workforce intact.

As for expansion, we have bought 20 acres of land in the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) economic zone. We have a plan to expand and double our fabric capacity there. Besides exports, we will use them to capture and supply in the local market as well.

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

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