Bangladesh garment manufacturers and exporters want cash incentives to be raised from one per cent to three per cent against exports to traditional markets for the next fiscal year. At present, apparel makers enjoy a four per cent cash incentive for exports to non-traditional export markets.
The apparel sector has also sought a devaluation of the currency, which would help increase the competitive edge of Bangladesh’s exports in the global export market. Due to the controlled exchange rate, the country’s manufacturers were losing their competitive edge in the global market. In addition, manufacturers want the import duty on security and workplace safety related equipment to be withdrawn to make the sector safe and eco-friendly. They have made a request for funds which will enable them to invest in technology upgradation, product diversification and value addition and research.
Bangladesh’s apparel sector is now a 30 billion dollar industry. Cash incentives were introduced to the non-traditional market back in 2010, which were five per cent at that time. Owing to duty-free access and cash incentives, garment owners have now started exploring new destinations and markets. China, the world’s largest apparel supplier, now allows duty-free access to over 5000 Bangladesh products, which eventually has enhanced the export growth of the apparel sector.