BKMEA Demands Raise In Wastage Rates Yet Again

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BKMEA Demands Raise In Wastage Rates Yet Again

The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) has demanded that the government raise the wastage rates of raw materials used in producing readymade garments, particularly for knitwear items, yet again as the trade body believes the recently revised rates are "not realistic". The commerce ministry usually sets the rate to curb irregular practices in cotton and yarns that are allowed to be imported duty-free. The Commerce Ministry has revised the maximum wastage rates to 27% from 16% for the production of basic knit items – such as t-shirts, polo shirts, trousers, shorts, skirts, pyjamas. The revision was made as per the recommendation of a committee that the ministry formed a year ago following requests of the manufacturers. Apart from the basic items, the authorities for the first time, creating separate categories, set a wastage rate of 4% for sweaters, socks and similar items, 30% for special items including rompers, gowns, and hoodies. However, the BKMEA Executive President Mohammad Hatem, in a letter to the Commerce Minister Tipu Munshi, expressed his concern over the newly-set rates and said the actual wastage was higher than the newly set rates. In the letter, the apex trade body of the knitwear producers urged the government to raise rates to 30% for basic knit items, 35% for special items, and 12% sweaters and socks items. "In the meeting, stakeholders concerned presented detailed data on the actual wastage rates with practical explanations. Sadly, the reevaluation of the rates did not reflect it," said the letter. Around 90% of knitwear are basic items. The letter also reads that no sweater factory has been inspected by the committee so far but the wastage rate is fixed at 4% for the items, which is completely unreasonable. The rate in sweater production is usually more than 12%, the BKMEA said. "The new rates set by the order will pave a new way for the officials to make irregularities. Manufacturers will be harassed," said Fazlee Shamim Ehsan, vice-president of BKMEA. Meanwhile, some apparel manufacturers did not agree with the BKMEA and said the newly set rates were rational. Experts also said it was expected to reduce wastage rates thanks to the latest technology and machinery. Centre for Policy Dialogue (CPD) Research Director Dr Khondaker Golam Moazzem believes that the wastage rates should be reduced thanks to modern technology and machinery usage. Meanwhile, a revenue board senior official said the wastage rate for basic knit items should be fixed at 20%. "The newly-set 27% is much higher." For the "irrational" maximum limit for wastage, the government would lose revenue, he said.