The forthcoming budget shouldhave the arrangement to help the ailing garment sector by way of  fiscalsupport and allocations for quick development of gas and electricity, ports andcommunications.

The demand came from thecountry's textile engineers trade body 'The Institution of Textile Engineersand Technologists, Bangladesh (ITET) at a pre-budget press conference held atthe Jatiya Press Club in the city.

Its president and generalsecretary Eng Md Masudur Rahman, and Eng. Md Enayet Hossain told the media thatthe country's garments export is facing a steady demand crunch in theinternational market due to prolonged recession in the USA and Europeancountries.

Although initially Bangladesh'sgarments exports did not suffer due to its lower  end products meant for low cost buyers, it is becoming effectednow as the recession is going longer and deeper.

Moreover, in the domestic front,shortage of gas and electricity is forcing the garment factories to large putpart of their production facilities unutilized.

Operating cost of generators,high interest on bank loans, 50 percent rise in tax at sources, rise in cost ofraw materials and on top of it, liquidity crisis in banks have forced the overallproduction cost of garments to all time high. Shortage of electricity isforcing about 60 percent productivity at factories to face disruption.

They told the media that alone inlast one year garments exporters have to pay over several hundred thousandcrore taka additional shipment cost of merchandise. Since they failed to meetthe shipment target because of electricity failure, they have to send theclothes by air cargo to shoot up the shipment cost.

This, in turn, is eroding thecountry's competitiveness with the major rivals like Vietnam, Thailand,Cambodia who want to knock out Bangladesh in the global market.

Pointing to a new development,they said the garment sector is facing a new option now either to keep theplants shut for 12 hours a day or buy electricity at generation cost at aroundTk 60 to 17 per kilowatt. Most factory owners are facing a critical choice andit may only significantly add to their production cost and competitiveness inthe export market.

It may obviously force theindustry on the other hand, to reduce expenditure on wages and allowances,besides sharp cut on cost of research and development. They gave a dismalpicture that the industry is increasingly facing with only 12 percent exportgrowth at the highest this year compared to 42 percent last year.

This is why the garment industryrequires strong budgetary support in the next fiscal they said. Listing some ofthe demands they said import duty on dye, chemicals and machine parts used inthe garments sector need to be lowered to 1 percent to 10 percent instead of2.5 percent to 25 percent now in force.

Interest on bank loans forcapital investment and working capital should be lowered at 9 percent.Corporate tax must be reduced and taxable income ceiling to be doubled. Theyalso asked the government to set up an 'Equity and Entrepreneurship Fund' andallow low cost loan to highly skilled textile engineers to help them set up newhigh tech factories in the textile and garment sector.

Government should also allocateresearch and development fund and open new research and teaching faculty in thenewly set up universities. They presented a list of 15 demands and urged thegovernment to make allocations against them so that the garment industry canovercome the strings at home and abroad.