Siatex Bangladesh Ltd

Bangladesh is still a bright place for new textile and readymade garment factories, despite a barrage of gloomy reports of the giant economies hurtling into a deeper financial crisis. Industry insiders say so.

High-profile textile and RMG machinery makers feel that Bangladesh will do better in future, even in times of global recession. This is supported by the twin facts that the country mainly produces basic apparel items and labour costs are still competitive.

According to statistics from the Bangladesh Textile Mills Association (BTMA), the primary textile producers imported textile machinery worth Tk 1,930.59 crore in the July-December period of the current fiscal year.

Of the total machinery imported, 80 percent was intended for spinning mills, the BTMA data reveals. The woven and knitwear manufacturers also imported a significant quantity in the same period.

Mindful of the prospect for expansion in apparel business, many textile, RMG and accessory machinery makers from around the world have been pouring into Bangladesh to take part in different exhibitions.

The participation of foreign companies in the ongoing four-day sixth Dhaka International Textile and Garment (DTG) Show clearly indicates the country’s strength in the textile and RMG sector.

“Bangladesh is a prospective country for us,” says Yasuhiro Miura, assistant manager of Toyota Tsusho Corporation.

Miura is now in Dhaka, attending the textile machinery fair organised by BTMA and the ES Event Management Company of Malaysia at Bangladesh-China Friendship Conference Centre.

An optimistic Miura says businessmen always study the GDP growth of a country before they pen business deals with that country.

Since Bangladesh has been maintaining a commendable rate of growth over the last few years, foreign companies are confident of extending their hands to strike deals.

“Bangladesh is a country of cheap labour. A large workforce is an asset to the nation. This is why the country will soon do better,” Miura tells The Daily Star.

Citing good business relationships between Bangladesh and Japan, Miura says there is enough room for further expansion of bilateral trade between the two countries.

He says 76 percent of foreign currency earned is courtesy of the RMG sector, a signpost to the potential of textile and RMG machine manufacturers.

Miura claims Toyota Tsusho has a 50 percent market share in the market for brand new textile and RMG machinery in Bangladesh. He expects a good number of orders from the local textile and RMG entrepreneurs at the exhibition, as they started receiving responses from the buyers.

The textile and RMG sector has a bright future in Bangladesh, he adds. Hundreds of textile and RMG machinery manufacturers participated in the DTG, which is billed as the world’s second largest machinery expo, after the International Exhibition of Textile Machinery (ITMA).

ITMA, the world’s largest international textile machinery, is recognised as the ‘Olympics’ of the textile machinery industry.

Speaking to The Daily Star, Oliver Schermuly, managing director of SETEX, a German textile machinery company that participated in the DTG, also acknowledges that Bangladesh is a prospective country for further expansion of the textile and RMG.

SETEX exports textile and RMG machinery to Bangladesh.

“I see Bangladesh as a promising country even in the age of global financial recession,” Schermuly says.

Echoing Schermuly, Waqar A Choudhury, director of Nascom Pvt Limited, the local agent for some foreign textile machinery companies in Dhaka, says he receives good responses from buyers.

More than 600 companies from over 30 countries are showcasing their machinery and other textile accessories at more than 800 booths. World-renowned textile and RMG machine manufacturers from Japan, China, Germany, Turkey and Korea have come up with the latest textile and RMG products.

The government reduced the duty on import of capital machinery from 5 percent to 3 percent in its budget for fiscal 2008-09. At the same time, the government had introduced a 1 percent procedural fee on imports, instead of the previous indemnity bond system.

The rising import of textile machinery proves the strength of the country’s backward linkage industries. At present, the knitwear sub-sector can obtain 90 percent of their required raw materials from the local market, while the woven sub-sector can get 40 percent, industry people say.

In the July-December period of 2008, Bangladesh exported woven garments worth $2.805 billion against a target of $2.738 billion, knitwear exports were $3.240 billion against the $3.172 billion target, terry towel exports were $66.39 million against the $59.83 million target and textile fabrics exports were $41.63 million against the target of $38.49 million.

source: thedailystar.net