• Sunday, Oct 24, 2021
  • Last Update : 03:10 pm

Experts demand incentives for subcontract RMG factories

  • Published at 07:51 pm September 19th, 2021
RMG worker

Small factories, which are basically run on a subcontract basis, did not get any government incentive facility

Experts recommended initiating plans to bring small and well-functioning RMG factories under the facilities of the government incentives. 

The speakers made the recommendation at the Media Cafe, organized by Shojag Coalition and Prothom Alo on Saturday. It was the third and final round of the virtual discussion session titled “Challenges of the Garment Industry in Coronation and Safety of Workers.”

The Shojag coalition consists of five organisations - Naripokkho, Christian Aid, BRAC, Bangladesh Legal Aid and Services Trust (BLAST) and SNV.

The government gave special incentives for garment factories in two phases to offset the losses incurred by the Covid-19 pandemic. But small factories, which are basically run on a subcontract basis, did not get any incentive facility.  

As a result, the factory was closed without retrenchment of workers’ wages and other allowances. 

In order to protect the interests of the workers, experts recommended bringing the factories under the incentive facility.

The speakers at the program also demanded that information on how much incentive a factory has received needs to be made available to everyone on the website.

They said that the government had issued a circular on March 31 last year to provide special incentives for export-oriented factories to protect workers and keep the factories running.  

Later, in June-July last year, the government disbursed the second phase of the incentives to pay the wages, bonuses of the workers and employees.  

After starting to turn around from the stress of the pandemic, the apparel industries of the country started to get lots of purchase orders. 

At the same time, the demand for workers also rose and the exports have also increased compared to the time of the beginning of the pandemic. 

Nurul Alam, deputy general manager of Bangladesh Bank, said that the target of incentive has become fully successful.

“There are about 4.5 million garment workers in the country. Of these, 3.7 million workers and employees have been paid from this special incentive at 2% interest,” he added.

He also said that Bangladesh Bank has relaxed the deadlines of repaying of the incentives.  

Professor of Economics at Dhaka University and Research Director of the South Asian Network for Economic Models (SANEM) Saima Haque Bidisha presented survey data at the program. 

She said that 52-53% of garment factories have received loans from the incentive package. But the factories working on contract remained out of incentives.

“In the beginning, the factories disbursed wages through mobile banking.  As most of the women workers did not have any mobile phone or their phone was controlled by their husbands, they did not have the freedom to support their families,” she added.

Moreover, 19% of workers suffered from uncertainty about jobs and wage reductions, she also said. 

Shahidullah Azim, vice-president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that there is no fear of workers losing their jobs at the time. 

“Bangladesh is getting lots of purchase orders. Sometimes, It even seems that there is a shortage of workers,” he added. 

He also said that there were no allegations regarding the incentive money not reaching the workers.  

About the repayment instalments, he said that they already applied to the government asking for more time.  

Mahin Sultan, team leader of the Shojag Coalition and a member of the Naripokkho, said that effective arrangements need to be implemented in the workplace to protect the interests of workers.

“In the coming days, it is necessary to plan how the small and well-functioning factories will come under the incentive facility,” he said. 

Firoz Chowdhury, assistant editor of Prothom Alo conducted the online program.


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