RMG sector in fresh fear ahead of Eid

Payment of wages, bonuses big challenge

Golam Mostafa Jibon: Though, the RMG sector has remained operative despite the strict lockdown, owners and traders are facing new challenges over the payment of wages and bonuses for the workers and employees ahead of Eid-ul-Azha due to declining of new orders.
Sources said, the government has imposed fresh strict lockdown to prevent the coronavirus with Indian Delta variant, which has recently spread massively across the country. Therefore, plying of all modes of public transports has remained suspended, while all markets, shopping malls and offices have been shut down.
In this situation, garment industry, the country’s top export sector, has been hit hard again ahead of Eid-ul-Azha, also the second largest festival of Muslims. There is no certainty as to when the situation will return to normal. Meanwhile, the work orders slump anew. Besides, clothes have to be sold at less than the market price. In such a situation, some owners have been forced to close their factories as they cannot pay the workers’ salaries due to insufficient work orders.
Rest industries, which are still in operation, are in apprehension of facing fresh crisis over payment of wages and bonuses of the workers and employees before the Eid.
Experts seem that, the industry needs to innovate, improve and diversify in response to the challenge posed by the epidemic, which has taken a turn for the worse in the global market. In the face of these challenges, new crisis is growing in the sector day by day. Price hike of various raw materials including yarn, dye and chemicals in the world market has brought a new catastrophe in the RMG sector.
In addition, many are being forced to sell their products with low prices as the buyers are not showing interest to give new order with high prices due to the corona pandemic.
Finding no way, many are closing down their businesses and closing the factories. The Bangladesh EPZ Investors Association (BEPZIA) fears that several more factories damaged by the corona pandemic may be shut down shortly.
They said, the prices of dye and yarn have gone up recently in the international market.
Earlier, on an average price of per pound cotton was 75 cents, but now it has increased to around 90 cents.
The price of organic cotton has exceeded $ 1. But, the price of ordinary yarn in the country’s market has gone up by 25 to 30 cents per Kg and the price of organic yarn by 60 to 70 cents.
So, the price of yarn has increased and the cost of a piece of T-shirt has increased by an average 6.5 cents.
BTMA president Mohammad Ali Khokon said, “The price of yarn came to reduce on the pretext of cancellation and suspension of purchase orders during the corona pandemic. But, the price of yarn has not increased at the rate at which the price of cotton has increased at present.
On the one hand, textile mill owners do not have enough stocks of yarns and many have no capacity to buy new cotton due to financial crisis. But the demand has also increased. That is why, prices have gone up again.
Prices of various raw materials including polymers, yarns and chemicals have increased by 40 to 80 percent in the international market since last March when Indian and Chinese garment factories had been remained fully operational.
But, due to the reduction in the price of readymade garments in the international market, the sellers of accessories are not able to collect extra prices from the garment exporters. They are also facing losses.
Al Shahriar Ahmed, General Secretary of the Bangladesh Apparel Youth Leaders Association said, “Prices of various raw materials including yarn have started rising since last January. Meanwhile, the change in sourcing for the country’s ready-made garment sector has emerged as a new challenge due to the coronavirus.”
Bangladesh’s garment sector has huge potential to survive and become mature as the world’s largest ready-made garment manufacturer. If the Bangladesh government adopts new strategies to attract foreign investors in this sector, it can bring benefits to the country. Corona is the cause of so many problems in this sector. This is why, the government should bring the whole nation under vaccination shortly to keep the economical wheel active, insiders said.