Renewal of 27 tanneries’ bond licence suspended over non-compliance

The renewal of bond licences of 27 tanneries has been suspended due to environmental non-compliance.   

The Customs Bond Commissionerate of the National Board of Revenue (NBR), in a notice issued on 28 June, said clearance certificates from the Department of Environment are a must for renewal.

In addition, the NBR also hinted that the licences of these tanneries might be suspended for breaching bond licence conditions, along with import-export bans. 

Without the bond licence, tannery owners will not be able to import chemicals, required for animal hide processing, at duty-free facilities, which will cost them an additional 30-35% to process leather.

The Bangladesh Tanners Association (BTA), a platform of tannery owners, has already met the top officials of NBR and requested them not to delay the bond licence renewal. 

The Department of Environment and other parties concerned also are being contacted by the Ministry of Industries, which is responsible for supervising the tannery village in Savar.

Md Shaheen Ahamed, chairman of BTA, told Business Standard (TBS), "Without a valid bond licence, the tannery industry will face disaster as chemicals cannot be imported under a duty-free facility. Some of the imported chemicals are stuck at the port."

"We have already spoken to NBR officials about this matter. I will talk to the Department of Environment this week," he said.

Kazi Mustafizur Rahman, the commissioner of Customs Bond Commissionerate, told TBS, "After we issued the notice, imported chemicals stuck at the port were released before Eid upon attestation from the tanneries concerned. However, I have sought guidance from the NBR regarding the next step."

Most of the tanneries obtained bond licences while being located at Hazaribagh in the capital.

According to industry insiders, this chemical accounts for about 30% of the value of exported leather. That is, the amount of local value addition is about 70%. Currently, there are 152 tanneries in Savar, out of which 135 are operational.

As per the bond licence conditions, environmental compliance clearance is required from the Department of Environment. But due to non-compliance, no tannery except one in Chattogram has received clearance, sources said.

Tanneries were given a year's time during their licence renewal last year for submitting environmental clearances. But no factory did so. Later, they were given another three months, but they failed to comply.

Apex Tannery Limited, Bay Tanneries Unit-2 Ltd, Dhaka Tanneries Ltd, Bengal Leather Complex Ltd, Dhaka Hide and Skins Ltd., Mitali Tannery, Pragati Leather Complex Ltd, Amin Tannery Limited, Anwar Tannery Pvt Ltd, and Reliance Tannery Limited were among the 27 tanneries warned by the NBR.

It has been alleged by the tanners that the Central Effluent Treatment Plant (CETP), maintained by the industries ministry, does not have the capacity to treat the amount of waste that comes from the tanneries. 

As a result, the waste goes to the Dhaleswari River through the waste bypass line. Apart from this, solid waste management is also in dire condition. 

In order to solve these issues, Dhaka Tannery Industrial Estate Wastage Treatment Plant Company Ltd was formed recently.

The managing director of this company, Mustak Ahmed, also admitted that the tanneries were not completely environmentally friendly. 

However, he said those who have shown improvement should be given environmental clearance. At least 10 tanneries should get this licence.

Professor Mohammed Mizanur Rahman, director of the Institute of Leather Engineering and Technology, disagreed with Mustak's statement.  

"CETP is not the problem. This issue is not being solved because BSCIC is not fulfilling its duties properly," he said.

Exports in the leather sector crossed the $1 billion mark in the recently concluded fiscal year 2021-22, with a growth of 32%.