Motor parts businesses in Jashore sinking in losses

Highlights:

• 2,000 motor parts businessmen in Jessore
• Tk10,000 crore total investment
• Most of the businessmen have bank loans
• Only 15 to 20 businessmen received incentives
• 50 businessmen closed their shops due to the pandemic
• Around 8 crore 43 lakh kg of motor parts imported in the last 5 years through Benapole
• Tk219 crore 57 lakh revenue collected in last 5 years

Some 2,000 motor parts businessmen in Jashore, who import and distribute their products all across the country, are facing an extreme economic crisis due to the Covid-19 pandemic. Many of them have already closed their businesses after facing continuous losses since March last year when Covid-19 first hit the country.

According to some of these businessmen, the sector has an investment of around Tk10,000 crore, a large portion of which came from bank loans. But they have been unable to bear the burden of bank loans amid the pandemic.

The latest lockdown has made the situation worse and paying employee salaries is becoming increasingly difficult and uncertain, they said.

Md Hassan, owner of Sharif Traders on RN Road in the city, closed his shop as he could not repay his bank loan. Some 50 other businessmen like him are out of business due to the crisis and the panic is spreading to other traders.

According to some, only 15 to 20 big businessmen have received government incentives so far, while most others in this business have not.

Rejwan Ahmad Murad, owner of Faria Motors on the Jashore-Khulna road, said, "There was no business last year due to Covid-19. I somehow survived and paid my employees. But now, the lockdown has been imposed again. There is again no business now, but the interest due on my bank loans is piling up."

Md Rana, owner of Nirjan Enterprise on RN Road in the city, said, "I mainly import three-wheeler and four-wheeler parts. Customers from different districts of the country come and buy these parts, but Covid-19 has affected our business badly."

"Business has come to a complete standstill as traffic has stopped and people do not have cash. I am worried about bank loans," he added.

Farooq Hossain, owner of Medina Autos, said, "I import motorcycle parts which are delivered all over the country. I got into trouble importing parts amid the pandemic. Now I cannot make the bank payments and I have no business to speak of."

Anwar Hossain, general secretary of the Jessore branch of Bangladesh Motor Parts and Tire Tube Traders Association, said all businesses in the country are in recession amid the pandemic. "There is a terrible recession going on in our sector and all the businesses here, large and small, are financially devastated.

Shahinur Hossain Thandu, president of the Jessore branch of the Bangladesh Motor Parts and Tire Tube Traders Association, said, "A few businessmen have received government incentives, but the small parts traders doing business on loans of Tk20 to 50 lakh have not gotten any incentives. But if they were given incentives, they might be able to protect their businesses."

He said, "Around 2,000 motor parts shops here have about 20,000 employees with salaries ranging from Tk8,000 to Tk15,000 per month. Salaries have become uncertain and if we cannot do business, the situation will be worse here."

The lion's share of Benapole Customs revenues come from imports of high-duty car chassis and motor parts, but demand and imports have declined, negatively impacting tax revenue.

According to the Benapole Customs Office, in the last 5 years, some 8 crore 43 lakh 782.97 kg of motor parts have been imported through Benapole, generating around Tk219 crore 57 lakh in import duty revenues. In 2020, one crore 54 lakh, 65 thousand and 57.16 kgs of motor parts were imported.

Mofizur Rahman Sajan, president of the Benapole C&F Agents Association, said, "The higher the import of car chassis and motor parts, the higher the revenue collection. It is normal for revenue to decline if imports go down and only low duty goods are imported."

Mizanur Rahman Khan, former president of the Jessore Chamber of Commerce, said, "All businesses collapsed due to the corona. The car business has been badly impacted because people have less cash and are not keen to buy cars or change parts."

Commissioner of Benapole Customs House, Md Azizur Rahman, said fewer motor parts are being imported and this business is adversely affected by Covid-19, just like so many  other businesses in general.