Bangladesh's textile mills may suffer as banks unwilling to open LCs

Domestic spinners may continue production activities for the next three months till the existing raw materials stock lasts, it said.

The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) also admitted facing similar problems.

In a letter to the central bank, signed by BTMA president Mohammad Ali Khokon, the association said factories could not import required raw materials like cotton, polyester staple fibre (PSF) and viscose staple fibre (VSF) to feed the readymade garment (RMG) exporters despite receiving orders.

"Declining stocks of raw materials amid commercial banks' unwillingness to open LCs might severely hamper production and exports of textile and apparel items," Bangladeshi media reports quoted the letter as saying.

Textile mills need to have raw material stocks for at least four to five months for uninterrupted production and export activities, he pointed out, explaining that it also takes three to four months to get imported raw materials.

The production disruption would not only deepen the existing dollar crisis, but also hit export earnings, the association cautions, fearing unemployment as well.

BTMA requested the central bank to take necessary measures and instruct the commercial banks accordingly.

ALCHEMPro News Desk (DS)