Specialised textile mills and powerloom industries in Bangladesh want policy support for setting up modern machinery, cheaper bank loans and a reduction of 15 per cent in VAT. About 70 to 75 per cent of the textile industry depends on powerlooms and the existing looms are all outdated. They want to replace existing powerlooms with modern ones like rapier, water jet and air jet looms. But modernisation of the textile sector is not possible without support because the high-tech looms are expensive.

Businesses say the 14 per cent bank interest rate is too high and if it is reduced to single digits, the local weaving sector can supply the required fabrics to garment exporters that will also help bring down import dependency and save a huge amount of foreign currency.

The 15 per cent VAT has been termed as suicidal. Weavers say they won’t be able to pay and the VAT would raise prices of locally-produced clothes, which are facing stiff competition from imported garments. They say if the 15 per cent VAT is not withdrawn, most small and medium-sized weaving mills will shut down and leave thousands of workers jobless. The powerloom sector supplies 7,400 million meters of fabrics but the requirement is for 14,000 million meters of fabrics.