Export-oriented knitwear producers demanded re-fixing the US dollar rate much higher for encashment of their export proceeds, similar to remittance earnings.
They also favoured the rate re-fixing to strike balance between export and import rates, adding that the gap between buying and selling should not be more than Tk1.
They urged the Bangladesh Bank (BB) to fix the dollar rate at Tk110.70 each from Tk99 for encashment of export proceeds like remittance earnings to help them survive amid various local and global shocks.
Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Executive President Mohammed Hatem made the plea to the central bank in a letter on October 8.
The BKMEA letter said the knitwear sub-sector of the country's ready-made garment industry, which earned $23.21 billion in FY22 -- recording over 36% growth -- is dependent on import for raw materials and dyeing chemicals.
The sector's production cost went up significantly with the rise in global prices of oil, transportation, raw materials and other logistics.
Also, the exporters are incurring huge losses due to the difference between import bill payments and export proceeds encashment in dollars, Hatem explained.
The BKMEA leader made four proposals to bring harmony in imports and exports.
These included taking opinions of the two apparel trade-bodies -- the BKMEA and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) -- into consideration along with those of the associations of bankers and foreign exchange dealers while fixing dollar rates.
Majority of the export payments are being deferred ranging between 60 days to 120 days, while the exporters get 90 days to 120 days to settle import bills, he noted.
Dollar exchange rate for the exporters is Tk99, while the banks are paying at a rate of Tk105-106 for back-to-back letter of credit (L/C) or other import bills.
"We are facing a huge financial loss due to the dollar conversion rate, which is not acceptable," Hatem said in the letter.
He apprehended that a large shortfall would be created due to the gap, which the exporters cannot adjust, and requested the central bank to instruct the commercial banks to pay bills through the EDF -- as was done previously.
The BKMEA leader noted that remittance and export earning equally contribute to increasing forex reserves.
But the dollar exchange rates for remittance and export earnings were fixed at Tk110.70 (including 2.5% incentive) and Tk99 respectively.
"As a result, the gap between remittance and export earning encashment stands at TK11.70, which is discriminatory and not acceptable," he added, requesting same exchange rate for exporters.
On September 26, the Bangladesh Textile Mills Association (BTMA) also made a similar request to revise the dollar rate.
