Proposed gas price hike to be finalised in consultation with businessmen: Commerce adviser

A proposal to increase gas prices will be finalised in consultation with businessmen, said Sk Bashir Uddin, adviser to the ministries of textiles, jute and commerce, at an event today (8 January).

Referring to the proposed increase, he said, "The economic exploitation caused during the previous Awami League government — estimated at Tk28 lakh crore — will have to be borne by everyone. Otherwise, the economy will plunge further into crisis."

The adviser made the remarks at the inauguration of the Garment Technology Tradeshow and the Garment Accessories & Packaging Tradeshow at the International Convention City Bashundhara in the capital.

The event was jointly organised by ASK Tradeshows & Exhibitions Pvt Ltd and the Bangladesh Garment Accessories & Packaging Manufacturers and Exporters Association (BGAPMEA).

Responding to businessmen's dissatisfaction with the proposed gas price hike, he said, "The proposed gas price hike has not been planned in the same way as during the tenure of the previous government."

He mentioned that renewable energy is now the cheapest option, highlighting the opportunity for investment in this sector.

What businesses say 

Former BGAPMEA president Chowdhury Rafez Alam said that the industry will suffer if gas prices are raised again.

He commented that businesses are facing constant challenges, which may lead the next generation to move away from the industry.

Shawkat Aziz Russell, president of the Bangladesh Textile Mills Association, said the previous government had decided to raise gas and electricity prices without any consultation with stakeholders. He added that the current government has also taken similar steps without discussions.

"If we had been given the opportunity for talks, we could have provided some suggestions." 

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association, said, "We do not understand why we have to pay the price of gas per unit Tk70-Tk75."

He added that this will create uneven competition between new and old local industries and will also erode their competitiveness in the international market.

Hatem stated that the decision to graduate from LDC status in 2026 is self-destructive. 

He pointed out that the previous government had halted export incentives, which has led to the need to import yarn and fabric, thereby harming the local textile industry.

Hatem called for a 5-year delay in the LDC graduation process.

Former BGMEA president Chowdhury Anwar Alam Parvez said, "The labour-dependent future we envisioned for Bangladesh is now fading away."

He pointed out that 37% of the educated population is unemployed, and this issue cannot be resolved without a focus on the manufacturing sector.

Parvez expressed doubts about whether the government truly wants a manufacturing industry, as factors such as high bank loan interest rates and rising fuel costs are not in its favour.

He also noted that due to changes in the classification of bank loans, most factories are likely to become defaulters within the next three months. 

Accessories, packaging indirect export $7 billion

Of Bangladesh's $47 billion garment exports, the contribution of the garment accessories and packaging sector accounts for $7 billion in indirect exports, said Mohammad Shahriar, president of the BGAPMEA.

The total export earnings amount to $8.5 billion, with $1.5 billion coming from direct exports, he added.

He mentioned that during the Covid-19 pandemic, when all imports were halted except for medicines, local companies were the sole suppliers of 100% of the accessories and packaging for export products.

Quoting a Bloomberg report, Shahriar said the global demand for accessories and packaging in 2021 was around $750 billion.

He expressed hope that with government export incentives, direct exports in this sector would increase further.

Former BGAPMEA president Chowdhury Rafez Alam said 77 companies are showcasing their products across 270 booths at the tradeshows.

He further mentioned that until the late 1980s, all types of accessories and packaging products had to be imported, which increased lead times.

Emphasising the need for government support to achieve the target of $100 billion in garment exports by 2030, he said, "We are facing some policy-related inequalities."

Around 500 exhibitors from 25 countries are participating in the show spread over eight halls.

The event also featured speeches by South Korean Ambassador Park Young Sik.