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:: Fuel, Power Crises - RMG sector fears 50pc output fall ~
 
Prevailing diesel and power crises in the country are forcing ready made garment (RMG) manufacturers to keep their factories idle sometimes for five hours of a ten-hour working day, said leaders of the manufacturers.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) in a press conference yesterday said production in RMG industry might fall by 50 percent and production cost might go up by about 25 percent due to the crises.


The garment industry today faces a catastrophic fall and if the government does not address the problems immediately Bangladesh might lose its market to competitors like India and China.


BGMEA leaders demanded that the government improves the power situation urgently or provides them with diesel under special arrangement so they can maintain usual production rate. If diesel price is raised they want to be provided with diesel at a subsidised price.


BGMEA President Tipu Munshi said the government is claiming that there is no crisis of power and diesel in the country, but the reality contradicts its claim.


Munshi in his written speech said normally production goes on for 10 hours a day in garment factories, but now about five hours are being lost daily due to load shedding.


Many of the garment factory owners resorted to generators, but the recent crisis of diesel has worsened their woes.


Munshi also said they usually collect diesel in containers or drums. But with the backdrop of fuel crisis, the government put a bar on carrying diesel in containers, which Munshi said has been like 'adding insult to injury'.


Besides, 90 percent of the generators used in garment factories is diesel run and only about five percent is run by gas. So, in the face of diesel and power crises, garment factory owners are being forced to ship their product by air to make up for lost time in a bid to maintain deadlines. "Airfreight charges cost me about Tk 4 crore in just a month," Munshi revealed.


Abdus Salam Murshedy, second vice-president of BGMEA, corroborating Munshi's statement said in his case the amount spent in airfreight was double his president's.


Since many garment factory owners are being forced to ship their product by air there are long queues in the airport too and airfreight charges have also gone up two times even three time the normal rate in some cases, said Shahidul Haq Sikder, vice-president of BGMEA.

Annisul Haq, former president of BGMEA, said most of the garment factories are in Dhaka and Chittagong. "I don't think it is possible to smuggle diesel in containers out of the country from Dhaka and Chittagong. Why is then this bar on carrying diesel in containers?" Haq asked.


Haq gave examples of load shedding in some garment factories in Rupganj and Joydevpur from April 24 to April 30. This week saw power outage about seven times a day and electricity remained unavailable for about three to eight hours a day. So, while a garment factory in Rupganj would have run for 60 to 72 hours normally in six days, it missed a staggering 34 hours in the same period, Haq said. The situation is similar in Joydevpur.


Tipu Munshi said he received news that Swan Sweater factory at Konabari was shut down due to power and diesel crises.


The BGMEA leaders have already met state minister for power and also sought appointment with the energy adviser, but have yet to get a date, Munshi said.


The country's RMG industry has been struggling hard to keep afloat in a quota free world and more or less has managed to maintain its position. But the ongoing power and diesel crises have spawned great uncertainty over the fate of the industry and if the situation goes on like this Bangladesh might very well lose its business to India and China -- Bangladesh's competitors, Tipu Munshi observed.


When asked if export earning in RMG sector would drop this year and how much they are fearing to lose due to the power and diesel situation, the BGMEA leaders said it is not possible to say yet if export earnings would drop. They said they are trying their best to maintain schedules spending extra money, but added that they cannot afford to carry on this way indefinitely.


Source :
 

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