Super Jute Mill, once one of Bangladesh’s leading private-sector exporters of jute products, is now struggling under mounting debt, raising fears of bankruptcy. The mill, which once earned Tk20-30 lakh a day and exported products to 24 countries, has seen its fortunes reverse amid a prolonged financing crisis.
Superex Leather, another company owned by the same entrepreneur, is also facing a financial crisis.
Entrepreneur M Firoz Ahmed Bhuiyan has blamed the downturn on a lack of bank financing, while Islami Bank Bangladesh PLC says the company has failed to present a specific loan repayment plan and repay instalments.
Established in 2006 at Alka village of Phultala upazila with an investment of around Tk250 crore, Super Jute Mill employed nearly 5,000 people and became a leading private-sector exporter. Its products gained demand in 24 countries, and the company received state awards three times for its contribution to exports. Management sources said its daily profit once reached Tk30 lakh, while foreign buyers often paid in advance.
Following the mill’s success, Islami Bank reportedly assured Bhuiyan of substantial financing. In 2016, he invested around Tk700 crore to establish Superex Leather in a village of Khulna.
The factory installed advanced imported machinery, obtained Leather Working Group (LWG) certification and set up an effluent treatment plant imported from Italy at a cost of around $14 lakh. Management sources described it as one of three factories in Bangladesh recognised as green companies.
However, a shortage of working capital hampered operations. The company purchased leather worth around Tk150 crore using its own funds, but failed to secure bank financing for the chemicals and other materials needed for processing. Consequently, the price of the leather fell from Tk80 to around Tk20 per square foot.
Bhuiyan said production and business had gradually contracted after the bank stopped providing necessary working capital after 2017. He alleged that the group controlling the bank at the time sought to weaken his profitable businesses by withholding financing and eventually take them over.
He said Superex Leather was once valued at around Tk700 crore, against bank liabilities of approximately Tk600 crore. The outstanding debt has since risen to around Tk900 crore, including principal and interest.
Bhuiyan said the factories could resume production if the bank provided support, adding that they had sought around Tk200 crore in working capital.
Islami Bank’s Daulatpur branch manager Iftekhar Hossain said the company had yet to submit a specific loan repayment plan. He added that it had not taken advantage of an opportunity under a special Bangladesh Bank circular to regularise its defaulted loans by depositing 2% of the outstanding amount, complicating further lending.
