The Bangladesh Textile Mills Association (BTMA) has once again urged the government to impose anti-dumping duty (ADD) on cheap Indian yarn to save the domestic industry. Because of the pandemic, hundreds of mills in India are sitting on unsold yarn, which they are diverting to Bangladesh at cheap prices and many local garment makers are lapping them up, it alleged.

For instance, local millers are selling the widely-consumed 30-carded yarn at $2.80 to $2.90 a kilogram, whereas the same yarn can be procured at $2.60 to $2.70 per kg from India, BTMA was quoted as saying by Bangla media reports.

The Indian yarn is highly subsidised as the government offers incentives for cotton buying and yarn production at the mill level, according to BTMA secretary Monsoor Ahmed. As a result, yarn worth $1.4 billion have remained unsold at the factory level in Bangladesh over the last two months, he told a top newspaper in the country recently.

Therefore, BTMA wrote to finance minister AHM Mustafa Kamal, commerce minister Tipu Munshi and textiles and jute minister Golam Dastagir Gazi requesting measures to stop the invasion of cheap Indian yarn.

The letter requests the government to raise the cash incentive for garment exporters by 6 percentage points to 10 per cent if local yarn and fabrics are used.

The local millers churn out $12 billion worth of yarn a year and can meet 85 per cent of the demand for raw materials by the knitwear sector and 35 per cent by the woven sector.

In fiscal 2018-19, Bangladesh exported garment items worth $35 billion, and 63 per cent of the garment items were made from local raw materials. As a result, the retention value was also high at $15 billion, according to BTMA president Mohammad Ali Khokon.

On the other hand, the retention value from the imported raw materials was only $3.25 billion, the letter said.

The BTMA also demanded the import prices of yarn be scrutinised at the border land ports.