Halt yarn imports thru land ports to protect local industry: Millers to govt

Textile millers have urged the government to suspend yarn imports through all land ports – a facility that has reportedly been misused for a long time – in order to protect the country's local industry.  

Instead, they suggested allowing imports of this secondary raw material for the ready-made garment industry – the country's biggest export earner – only through seaports.  

The Bangladesh Textile Mills Association (BTMA), a trade body representing spinning and textile mill owners, made this request in a letter to Finance Adviser Salehuddin Ahmed.  

In late January, the finance adviser's office forwarded the letter, signed by BTMA President Showkat Aziz Russell, to the National Board of Revenue for regulatory consideration.  

Speaking to The Business Standard, Russell said the previous government had revised the policy to allow yarn imports through land ports.

However, these ports lack the necessary facilities to properly scrutinise raw materials.  

Additionally, the policy permitted partial shipments, which, according to industry observations, has led to widespread misuse, adversely affecting local mills.  

"We have seen growth in apparel exports in the new fiscal year, yet local mills are struggling due to multiple challenges, including low orders," he said.  

He said while Bangladesh's textile industry is facing difficulties, India's textile exports to Bangladesh have experienced significant growth, which is contrary to the country's interest.  

"It is absurd that policies are being implemented against local industries and job creation," he added. "We believe the interim government will revise this decision to protect domestic industries."  

In its letter, the BTMA warned that without an immediate ban on yarn imports through land ports, the country's textile sector would suffer irreparable losses, making it impossible to remain competitive.  

Additionally, increased reliance on imported yarn would drive up import costs and lead to higher unemployment.  

The letter also highlighted that the post-Covid economic downturn and the Russia-Ukraine war had severely impacted the country's industry, economy, and trade.  

The textile sector, in particular, has struggled due to rising gas and electricity prices, the dollar crisis, soaring interest rates, reduced export incentives tied to LDC graduation conditions, and the depreciation of the taka.  

Meanwhile, yarn and fabrics are entering the local market at dumping prices from India through various land ports, creating new challenges for the domestic textile industry.  

The letter highlighted the risks of yarn imports, noting that land ports such as Benapole, Bhomra, Sona Masjid, and Banglabandha lack proper infrastructure, yarn count measuring equipment, skilled manpower, and effective oversight. As a result, import and export trade is not being efficiently managed.  

The letter stated that allowing yarn imports and partial shipments has severely impacted the domestic textile industry, particularly spinning mills.  

Additionally, textile mills face unfair competition due to the widespread marketing of unauthorised yarn, often imported through land ports with false declarations at customs. This not only harms local industries but also results in significant revenue loss for the government.  

The policy permitting partial shipments has been widely misused, enabling multiple imports of yarn under the same LC beyond approved limits.  

The letter suggested halting yarn imports through land ports and shifting to seaports to protect the domestic textile sector. This would also help preserve valuable foreign exchange.  

Currently, yarn imports via seaports take 13 to 15 days but benefit from high-quality scanners, yarn count measuring machines, and better infrastructure.