Govt to support not only closed mills but also ailing ones

Prime Minister Tarique Rahman has assured garment exporters that the government will reopen all closed public and private factories across the country and provide support to struggling factories to prevent further closures.

However, state-owned closed factories will not be run directly by the government. Instead, they will be reopened through interested Bangladeshi entrepreneurs.

Infographic: TBS

Leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) shared the information with TBS after separate meetings with the prime minister at the Secretariat today (11 May).

After the meetings, top executives of BGMEA and BKMEA said the prime minister had asked for written proposals, after consulting factory owners, outlining what policy support is needed to reopen closed factories and rescue those on the verge of closure.

The two associations are expected to submit their written proposals after Eid-ul-Adha.

They said the prime minister placed the highest emphasis on employment generation. For that reason, he wants all closed factories in both the public and private sectors to reopen and also wants policy support for factories facing closure.

BKMEA Senior Vice-President Fazlee Shamim Ehsan, who attended the meeting, said the prime minister clearly mentioned two conditions for reopening state-owned factories through private management: they must be operated by Bangladeshi entrepreneurs, and they must produce the same products previously manufactured there.

There is no exact data on how many factories remain closed nationwide. After taking office, the BNP government initiated a Tk40,000 crore fund through Bangladesh Bank to help reopen closed factories. Around 300 garment factories are reportedly at risk of closure.

After the meeting, BGMEA President Mahmud Hasan Khan and BKMEA President Mohammad Hatem told The Business Standard they had requested that factories on the verge of closure also be given access to the fund.

They said the prime minister also wants to ensure no additional factories shut down and confirmed that vulnerable factories would receive assistance.

"The prime minister clearly told us that all closed factories will be reopened, and the government will provide every possible policy support to prevent any new closures. He also informed us of plans to reopen closed state-owned factories through privatisation," said BKMEA Senior Vice-President Fazlee Shamim Ehsan.

BKMEA President Mohammad Hatem told the prime minister that no entrepreneur would expand investment or bring in new investment unless gas and electricity supply improves.

He also requested removal of complexities surrounding the import of raw materials for man-made fibre and raw materials used in locally produced auxiliary chemicals.

The BGMEA delegation, led by President Mahmud Hasan Khan, met the prime minister first, followed by the BKMEA delegation led by President Mohammad Hatem. Each meeting lasted around an hour.

They informed the prime minister that identical support measures for all closed factories would not work, as each factory faces different problems. In response, the prime minister asked them to speak with factory owners individually and submit written reports detailing each case.

BGMEA President Mahmud Hasan Khan said, "The government cannot waive taxes or hand out money. But the prime minister asked us to submit written proposals on what type of policy support each factory needs so they can continue operations and preserve jobs. We will submit these after Eid."

He added that all duties and taxes on imports of equipment and batteries used for solar power generation and storage would be fully withdrawn.

BKMEA Senior Vice-President Fazlee Shamim Ehsan said, "The prime minister does not want foreign companies to run closed state-owned factories. He wants local entrepreneurs to operate them. But they must produce the same goods as before and meet international standards. Through this, the prime minister wants export diversification."

BKMEA President Mohammad Hatem said that during discussions on export diversification and reopening closed factories, the prime minister said anyone interested in reopening the Rajshahi silk factory should inform him.

He said the factory could be modernised to produce world-class silk products for export.

BGMEA President Mahmud Hasan Khan said the prime minister also stressed building export-oriented market networks, improving the business environment and diversifying exports.

"We told the prime minister that several Bangladesh Bank policies are pushing many operating factories towards closure. There are complications in accessing bonded warehouse facilities, and many factories are facing audit-related problems. We also highlighted barriers to simplifying import-export procedures.

"After receiving our written recommendations, the prime minister assured us that policies would be revised to simplify import-export procedures and improve the overall business climate," said BKMEA President Mohammad Hatem.

Commerce Minister Khandaker Abdul Muktadir, Housing and Public Works Minister Zakaria Taher, and Education Minister Ehsanul Haque Milon were present at the meetings