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Saturday, July 20, 2024

Bangladeshi exporters demand refunds to clear workers Eid dues

Fearing potential unrest because of their inability to clear wages and bonuses of workers before Eid, readymade garment entrepreneurs of Bangladesh have asked the government to release their pending cash incentives, amounting to Tk4,000 crore, against exports.

The leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) rushed to meet with the Prime Minister’s Principal Secretary Mohammad Tofazzel Hossain Miah on Sunday to raise the issue and requested for the release the funds immediately.

Sources said the newly elected President of BGMEA SM Mannan Kochi, Director Rajiv Chowdhury, and BKMEA Executive President Mohammad Hatem were present at the meeting.

The RMG leaders after the meeting apprised the media that many factories are short of cash and may not be able to clear the dues of the workers before Eid. They warned that inability to clear dues could trigger unrest. Mohammad Hatem conceded that exporters were entitled to Tk6,000 crore in cash incentives from the government. Of this, Tk2,000 crore was released last Thursday. “We have requested the authorities release the remaining Tk4,000 crore before Eid,” he said.

Sources privy to the meeting said no firm assurance was given by the principal secretary regarding the release of the fund before Eid. However, he said that the issue would be placed before the concerned authorities.

Labor unrest is brewing in Bangladesh on this issue. The Industrial Police last week released a list of factories that may have problems paying wages and bonuses. According to the list, at least 416 factories may encounter issues with salaries and bonuses before Eid.
According to that list, the Bangladesh Textile Mill Association (BTMA) has 29 member factories, in addition to 171 member factories of BGMEA and 71 member factories of BKMEA. The rest of the factories belong to other sectors.

Meanwhile, there have been reports of labor unrest in some factories over salaries and bonuses in different parts of the country. Industry leaders said the salary issue is not restricted to 416 factories and if the funds are not released before Eid the labor unrest would be difficult to manage.

Sources in the finance ministry said that they are short of funds and may not be able to pay refunds before Eid. In fact they said 33 percent of the struck up funds were released last week to ease the burden on exporters.

The finance ministry sources said besides the RMG sector or exporters, higher pending refunds of Tk30,000 crore are payable to the power sector. This is the reason that the ministry has to ration the release of money. However he conceded that if instructions from the division concerned are received, then we will implement them accordingly.

Currently, there are about 3,000 active export-oriented garment factories in the country. The new wages for this sector have been implemented since last December. Garment owners claim that despite the new cost of production, most foreign buyers have not increased the price of garment products.

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