The Bangladesh Textile Mills Association (BTMA) has expressed concern that the nation’s textile mills would lose competitiveness in the global market due to a hike in production cost after government’s move to import costly Liquefied Natural Gas (LNG).
BTMA President Tapan Chowdhury expressed these concerns recently while addressing a press conference at the recently concluded Dhaka International Textile and Garment Machinery Exhibition (DTG) – 2017, it was reported in a section of the Bangladeshi media.
“It would be very difficult to remain competitive in the global markets after using LNG in the manufacturing units as it would increase the production cost. We are yet to get any clarification about the possible LNG pricing and other related process although we have heard that per unit gas may cost Bangladeshi Taka 14, which would hit hard the spinning industry,” Chowdhury said.
He said that scarcity of land, insufficient gas and electricity connection are the key barriers to the private sector investment growth.
His statement comes after it was reported that the Bangladesh government plans to establish an LNG terminal at Kutubdia Island to supply imported gas to the industry since the country fears that it would run out of its natural gas stock in the near future.
Textile mill owners in Bangladesh fear that imported gas would lead to a hike in production cost due to which they could lose competitiveness in the global market.
They believe that it would eventually hurt the apparel industry since the textile industry is the source of raw materials for the sector.
Presently, Bangladesh’s textile industry has an investment of US$6 billion while readymade garments and textile the sector contribute about 86% of the country’s total exports, while the textile industry contributes 13% to the country’s Gross Domestic Product (GDP).