Cotton waste smuggling to India causes raw materials crisis

A combo of internet photos shows cotton waste (left) and terry towel (right). Country’s specialised textile industries, including terry towel manufacturering units, have been facing problem in meeting export orders due to an acute shortage of raw materials as cotton and garment wastes are being smuggled out and exported to India, industry people said.

Country’s specialised textile industries have been facing problem in meeting export orders due to an acute shortage of raw materials as cotton and garment wastes are being smuggled out and exported to India, industry people said.
They said the specialised textile industries produce yarn from cotton waste of spinning mills and garment waste better known as jhut through recycling and the yarn is used to produce terry towel, home textile, denim fabric, and khadi fabrics.
Sector people said that due to the shortage of raw materials the prices of yarn increased by 20-25 per cent in last 2-3 months.
They alleged that the cotton waste and garment jhut, the main raw materials for the specialised textile industries, were being smuggled out and exported with false declaration to India through Benapole, Dawki, Akhaura and Tamabil land ports.
Recently, the Bangladesh Terry Towel and Linen Manufacturers and Exporters Association has sent separate letters to finance and commerce ministries seeking government intervention to keep the supply of raw materials available for the sake of the industry.
According to the BTTLMEA letter, cotton waste and garment jhut are being exported to India under the name of garment clipping as the government in 2008 set minimum export prices for the products and imposed high export duty on cotton waste to discourage the export of the items.
Terry towel manufacturers apprehend that a dishonest quarter is exporting cotton waste bales covered with garment jhut to India as there is no export duty on garment waste.
‘Production at some of our member factories remained suspended for last one month due to a shortage of yarn as the raw materials are totally unavailable at the local market,’ AKM Mahfuzur Rahman, vice-president of the Bangladesh Terry Towel and Linen Manufacturers and Exporters Association, told New Age.
He said that cotton waste and garment jhut were going to India from Bangladesh and coming back in the form of yarn.
Mahfuzur said that the price of yarn increased to $1.60 a kilogram from $1.20 a kg in last two months.
He requested the government to strengthen monitoring at land ports so that the raw materials cannot be exported with missdeclaration.
In 2008, the government set minimum export prices for cotton waste at $4.5 (Tk 360) a kg with 25 per cent export duty.
‘We apprehend that misdeclaration is taking place in exporting cotton waste and garment jhut. A dishonest quarter is exporting cotton waste under the name of garment waste as the minimum export prices of garment waste is Tk 18 a kg and there is no export tariff on the product,’ Md Mujibur Rahman, secretary of the BTTLMEA said.
Export Promotion Bureau data showed that the export of garment waste witnessed more than 140 per cent growth in the first quarter of the current financial year 2017-18.
The export growth of garment waste indicates that cotton waste covered with garment jhut is being exported, sector leaders said.
According to the EPB data, country’s export earnings from specialised textiles in the financial year 2016-17 stood $106.14 million.

Source: New Age

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