Latest news with #BangladeshGarmentManufacturersandExportersAssociation
Yahoo
02-07-2025
- Business
- Yahoo
New BGMEA Chief Warns of Shipping Disruption From Iran-Israel Conflict
The Iran-Israel conflict could raise costs for the readymade garment (RMG) industry in Bangladesh, according to the new head of the South Asian country's biggest apparel association. Mahmud Hasan Khan Babu, the recently elected president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), pointed to oil prices as a catalyst for potential headwinds in his inaugural remarks at the trade group's complex in Dhaka on Monday. More from Sourcing Journal Maersk Halts Haifa Port Calls, Citing Israel-Iran Safety Risks Amid Israel-Iran Tensions, Shipping Slows Down in Strait of Hormuz Israel's Strikes on Iran Trigger Elevated Shipping Risks Across Middle East 'Oil price volatility resulting from the conflict will directly affect the energy and logistics expenses of our industry,' Babu said. 'If oil prices go up, there will be a spillover effect and the RMG sector will not be immune from the danger.' As both Israel and Iran continue to trade strikes, the new BGMEA president also shared concerns with Bangladeshi publication The Business Standard over potential disruption of global shipping routes, making parallels to the industry's experiences since the Red Sea crisis began in late 2023. 'We already faced major disruptions from the Houthi attacks, which cost us time and additional charges due to longer shipping routes to avoid danger,' Babu told the publication on June 13. 'Our effort to ease port congestion would worsen further if shipping lines were hampered.' Apparel carries Bangladesh's export economy, with the country exporting $36.6 billion in RMGs throughout the first 11 months of the 2024-2025 fiscal year through May, according to the Export Promotion Bureau. That represents 81.3 percent of the $44.9 billion in Bangladesh's total exports. Worries of slower, more expensive shipping could damage the apparel industry's competition with other foreign markets, the association notes, which could ultimately hinder the country's wider economy. During his inaugural speech in Dhaka, Babu called out other concerns facing the RMG industry, including the reciprocal tariffs placed on the country by the U.S., India's suspension of transshipment facilities for Bangladeshi exports, and other economic topics including high inflation, rising wages and elevated interest rates. At the event, which celebrated the handoff of BGMEA leadership to a new 35-member board of directors, Babu pledged to advocate for the establishment of a dedicated government ministry for the RMG sector. Garments typically fall under the purview of the country's commerce ministry, but Babu has argued that the industry has gotten too big to not have its own representation in government. While Bangladesh's apparel industry is apprehensive of the current geopolitical environment, it is also dealing with a slowdown of cargo in and out of the country's largest seaport. Chattogram Port, also known as Chittagong Port, is seeing significant congestion in the wake of the Eid al-Adha holiday, which lasted from June 5-9. In the seven days prior to June 13, the average waiting time for a vessel at the port was 5.6 days, according to Kuehne+Nagel's weekly port operational update. Normal waiting times at the port are typically estimated at one to two days. A report from supply chain publication The Loadstar said roughly 100 vessels are awaiting to dock at the port. The congestion comes as the port continues to handle containers in droves, both from the ships at berth and from 19 private inland container depots established outside of the hub. In a 24-hour span starting the morning of June 8, only 437 20-foot equivalent units (TEUs) of import containers were delivered and transferred, according to Bangladeshi publication The Daily Star. On an average day, the port will see about 4,500 TEUs moved. On June 9 and June 10, workers at the port transported 1,381 TEUs and 1,787 TEUs, respectively. The congestion caps off a year where the port still moved more cargo than ever. According to the Chattogram Port Authority, the port handled a record 3,171,779 20-foot equivalent units (TEUs) in the 2024-25 fiscal year as of June 15. The number is a 4.6 percent increase from the previous fiscal year, when not accounting for the final 15 days of June. The record number came even as Bangladesh experienced nationwide student protests that resulted in a government overhaul, on top of additional factors that led to major delays at Chattogram like flooding and a software glitch within its customs clearance systems. The authority recently proposed a 70 percent to 100 percent tariff hike for cargo handling at the port to Bangladesh's shipping ministry. According to the group, the added rates would cover the rising costs of nearly 50 services, including port dues, berthing fees, forklift charges, and utility costs. Port officials argue that Chattogram's fees remain far below regional peers, as unloading one TEU costs $100 in Colombo, $75 in Singapore, and just $43.40 at Chattogram, according to The Business Standard. Some parties have sought to give some pushback on the tariff, with former BGMEA director Belayet Hossain telling the publication that a more phased increase was necessary. 'A 10 percent to 20 percent rise is manageable,' Hossain said. 'Anything more will hurt at both ends—raw material imports and finished goods exports.' Nurul Qayyum Khan, president of the Bangladesh Inland Container Depot Association, agreed that a 15 percent hike would be more reasonable, noting that businesses already have to deal with currency depreciation, freight costs and rising port storage rents.
Fibre2Fashion
17-06-2025
- Business
- Fibre2Fashion
Iran-Israel war may pose challenge to Bangladesh's RMG sector: BGMEA
The Iran-Israel conflict may pose a challenge to Bangladesh's readymade garment (RMG) sector by raising the cost of doing business, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). BGMEA's new president Mahmud Hasan Khan Babu said the conflict may trigger a surge in global oil prices, which would, in turn, increase operational expenses for the country's RMG industry. The Iran-Israel conflict may pose a challenge to Bangladesh's RMG sector by raising the cost of doing business, according to trade body BGMEA. Other challenges include reciprocal US tariffs, India's suspension of transshipment facilities for Bangladesh goods, high inflation, rising wages, elevated bank interest rates and soaring energy costs, BGMEA's new president Mahmud Hasan Khan Babu noted. Other challenges include reciprocal US tariffs, India's suspension of transshipment facilities for Bangladesh goods, high inflation, rising wages, elevated bank interest rates and soaring energy costs, he noted. He vowed to advocate for the setting up of a dedicated ministry for the garment sector, domestic media outlets reported. He announced plans to introduce a digital platform, allowing BGMEA members to apply for various services and lodge complaints regarding the association's operations, and pledged to reduce the cost of BGMEA's services by 25 per cent starting from July 1. In October last year, the government appointed Mohammad Anwar Hossain as the BGMEA administrator to oversee the election process. Fibre2Fashion News Desk (DS)
India Gazette
14-06-2025
- Business
- India Gazette
Relationship between India-Bangladesh people cordial: BGMEA president Mahmud Hasan Khan Babu
Dhaka [Bangladesh], June 14 (ANI): Mahmud Hasan Khan Babu, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), termed the relationship between India and Bangladesh people as 'cordial'. Babu highlighted the similarities between the culture of West Bengal and Bangladesh, due to which the relationship between both countries is 'good'. Mahmud Hasan Khan asserted that due to the regime change in both countries, the situation also changes. He said that sometimes the relationship of countries is cordial, sometimes one-sided love and sometimes it is a resentful situation. Weighing on the 'huge' business between India and Bangladesh, Mahmud Hasan Khan said the people of both countries will benefit if relationship is cordial. 'The relationship between Indian and Bangladeshi people is cordial. Especially in West Bengal and Bangladesh, we have some common cultural things, so the relationship is good. But the problem is that when the government changes on both sides, the situation also changes. Sometimes cordial, sometimes one-sided love and sometimes it is a resentful situation. It depends on the government in India or the government in the relations between the governments are cordial, it would be the best because both countries will benefit. Business between India and Bangladesh is huge', he told ANI. Meanwhile, addressing the issue of investment situation in the country, Mahmud Hasan Khan Babu praised the current government and said that it has taken some good initiatives in terms of banking reforms, especially, control of looting and mismanagement of the banking sector. However, Babu asserted that the investors are waiting for the elected government in Bangladesh for investment and said that the business people of the country also want a 'permanent' government. 'By definition, this government is interim. Everybody knows, for the time being, they have come after the situation of the July uprising and revolution (last year)...This government has taken some good initiatives in terms of banking reforms, especially, control of looting and mismanagement of the banking sector. But in terms of investment, investors or businesses are waiting for the elected government. We, business people, would like to have a permanent government. We would like to see who is coming in the future. Based on their policy and activities, investment will depend. In an interim government, investors do not want to invest', Mahmud Hasan Khan Babu added. (ANI)
India Gazette
14-06-2025
- Business
- India Gazette
We are waiting for an elected government in Bangladesh, says BGMEA President
Dhaka [Bangladesh], June 14 (ANI): Bangladesh's business community and the investors are waiting for an elected government to take their decisions, said Mahmud Hasan Khan Babu, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), late on Friday. 'We, the business people, want a permanent government. During an interim government, the investors do not want to invest,' Babu told ANI in an interview. 'By definition, this government is interim. Everybody knows, for the time being, they have come after the situation of the July uprising and revolution (last year). This government has taken some good initiatives in terms of banking reforms, control of looting and mismanagement of the Banking sector. But if you say, in terms of investment, the investors or the businesses are waiting for the elected government,' he said. 'Normally, we business people would like to have a permanent government, and then we would like to see who is coming for the policy and activities; Investment will depend on that situation. Normally, during an interim government, investors do not want to invest. They keep them in a position of wait and see,' the BGMEA President said. 'I hope shortly, there will be an election. That election has to be a credible, fair election so the people can give their verdict. After a new government, the investment situation will improve,' he said. 'Business people and the investors are looking for an election, and sooner the better,' he added. 'Shutdowns of factories are happening. BGMEA has seven thousand plus members. Now, only 3,000 factories are exporting goods means they are in operation. So, 4,000 factories have already been eliminated for different reasons. Due to their inefficiency, natural calamities, man-made calamities like political situations or infrastructure reasons like problems in the ports or electricity or energy, different reasons. In this moment, we are facing challenges for the issues of energy that gas and electricity and inflation. We are waiting for an elected government,' he said. 'Relations between Indian and Bangladeshi people are very good and very cordial. Especially in West Bengal and Bangladesh, we have some common cultural things. But the problem is that when the government changes on both sides, the situation also changes. Sometimes very much cordial, sometimes one-sided love and sometimes it is a resentful situation. It depends on the government in India or the government in Bangladesh,' Babu said. 'We would like to see friendly relations with dignity. We should respect each other. If the relations between the governments level are cordial, it would be the best because both countries will benefit. Business between India and Bangladesh is huge. It is not for political relations but for necessity. So, if the relations between India and Bangladesh are cordial, that would be good,' he said. Muhammad Yunus, the Chief Adviser of Bangladesh's interim government, has hinted at holding national elections in early February next year. Many are considering the London meeting between Muhammad Yunus and Tarique Rahman as a game changer for Bangladeshi politics. Right now, former Prime Minister Khaleda Zia's BNP is the largest Political Party in Bangladesh, as Sheikh Hasina's Awami League is banned from running. Tarique Rahman, the son of Khaleda Zia, seems set to return soon to Bangladesh after 16 years in exile in London. Former Prime Minister Sheikh Hasina was ousted in a student-led uprising in August last year. She is now living in India in self-imposed exile. After Sheikh Hasina's fall, an interim government was formed under the leadership of Muhammad Yunus, a Nobel Laureate. (ANI)
Express Tribune
24-05-2025
- Business
- Express Tribune
Bangladesh cancels $21m defence contract with India's GRSE
The textile industry would be temporarily affected by the move, said Rakibul Alam Chowdhury of the Bangladesh Garment Manufacturers and Exporters Association. PHOTO: FILE Listen to article Bangladesh has cancelled a $21 million defence contract with India's state-owned Garden Reach Shipbuilders and Engineers Ltd (GRSE), amid growing strain in bilateral relations. The contract, awarded in July 2024, was for an advanced ocean-going tug for the Bangladesh Navy, a vessel designed for deep-sea towing and salvage missions. GRSE, a public sector unit under India's Ministry of Defence, confirmed the cancellation in a stock exchange filing on May 21. According to The Hindu, GRSE stated that the cancellation was anticipated and followed 'mutual discussions' with the Bangladesh government. The company added that the financial impact would be negligible, as the order represented just 0.8% of its ₹22,680.75 crore ($2.7 billion) order book as of March 31, 2025. No official reason was given by Dhaka. However, as reported by Business Standard, analysts view the move as a possible retaliation for New Delhi's recent imposition of import restrictions on Bangladeshi goods. On May 18, India tightened controls at Integrated Check Posts in its northeastern region, affecting shipments of ready-made garments and processed foods. These measures followed India's earlier decision to withdraw a transshipment facility that had enabled Bangladeshi goods to reach third countries via Indian territory. The diplomatic setback comes amid a broader shift in Bangladesh's foreign policy posture following the departure of Sheikh Hasina's administration in August 2024. The ocean-going tug, while modest in budgetary terms, had been a strategic symbol of India-Bangladesh defence cooperation. Its cancellation underscores a deterioration in that relationship. In a press release on May 22, GRSE said it had been selected as the lowest bidder for the Indian Navy's Next Generation Corvette (NGC) programme. The company, based in Kolkata, has delivered 111 warships to Indian maritime forces and friendly foreign navies, including missile and anti-submarine corvettes. India-Bangladesh tensions rise amid trade curbs and political crackdow India-Bangladesh relations have deteriorated in recent months due to escalating trade restrictions and political developments. India has restricted imports of Bangladeshi garments to select ports, impacting exports worth $700 million annually. It has also blocked Bangladeshi consumer goods at 11 northeastern land ports and ended a key transit facility for Bangladeshi exports to third countries via Indian routes. In response, Bangladesh halted yarn imports from India through land ports in mid-April. Despite being India's largest trading partner in the region during FY24, and India ranking as Bangladesh's second-largest export market, trade ties have cooled sharply. At the same time, Bangladesh's interim government has banned the Awami League—the party of ousted Prime Minister Sheikh Hasina—under anti-terrorism laws, citing security concerns.
