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Dhaka Tribune

Local accessories and packaging industries show great potential

Entrepreneurs demand changes in policies to help the industry grow further
Update : 28 Dec 2021, 08:31 PM

The apparel sector of the country once relied on imported accessories and packaging items but now the local manufacturers are fulfilling the demand, helping reduce overall cost and lead time. 

During the 1990s, the entrepreneurs started producing accessories domestically to solve complications with manufacturing the finished products.

Currently, almost all types of accessories and packaging items are being made in the country and have gradually become the prime backward linkage industry of the apparel sector.

At present, there are more than 1800 garment accessories and packaging industries across the country and they manufacture more than 30 garments accessories and packaging items, meeting almost 90% of the demand in the apparel sector. 

Currently, domestic manufacturers produce polybags, hangers, elastic straps, buttons, button tags, collar stands, labels, corrugated cartons, zippers, hangtags, backboards, neck boards, sewing threads, price tags, photo boards, gum tapes, tissue tapes, embroidery, padding, quilting and more.

According to industry insiders, the growth rate in this sector is 10% and after meeting the domestic demand, they now export products to various countries including China, Malaysia, South Korea and Vietnam.

At present, more than seven lakh people are employed in this sector currently, with a total investment of about Tk40,000 crore.

Nearly 1300 factories are operational at present.

Abdul Kader Khan, managing director of Khan Accessories and Packaging Company Ltd, and former president of the Bangladesh Garment Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA) said that in one sense, the local industry is meeting 100% of the demand in the apparel sector. 

“Most of the countries stopped production during the spread of Covid-19, so it was impossible to import these items from abroad, so we met the whole demand locally,” he added.

He also mentioned that the quality and design of the domestic products are good enough for the buyers to rely on them without hesitation. 

“There are no instances of shipments being cancelled or delayed due to poor quality or shortage,” he added.

Currently, along with the apparel sector they also supply accessories and packaging products to the pharmaceutical, leather, fruit, crockery and other industries. 

He said: “Our industry is worth more than $6 billion, as per the account of 18% to 20% of the total apparel exports.” 

“However, some policies of the government are needed to develop this industry and untap the potential.”

“We repeatedly demand to reduce the corporate tax rate to around 10% to 12% like the RMG sector, to halve the tax at the source of export, and to withdraw the existing income tax on the purchase of raw materials for export,” he added.

The accessories export earnings are not listed in the Export Promotion Bureau (EPB) data, though the discussion is ongoing with the central bank on this issue. 

ACL Accessories Industries Ltd, having a factory in the Kashimpur area of Gazipur, primarily produces metal buttons, metal zippers, nylon zippers, plastic zippers, and polybags for both the domestic and international markets.

Md Anwar Hossain, managing director of the company said that 80% to 90% of the demand of the local apparel sector can be met locally; as there are some special items that need to be imported.

He also said that the local market is currently matured and ideal for accessories and packaging items. 

“The apparel sector of the country is getting lots of purchase orders, so our market is also a strong one,” he added.

However, he complained that a number of foreigners easily conduct business in this sector which is a bit of a threat to the local manufacturers. 

“It is necessary to impose strictures on them,” he suggested.

Shahidullah Azim, vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that about 80% to 85% of the demand is met from the local accessories and packaging industry. 

They manufacture about 30 products, covering almost all the necessary items.

“The quality of the country's products is also very good. With the development of the local accessories and packaging industry, our apparel sector has become self-reliant,” he added.

He also said that they used to import these items from Hong Kong or South Korea but as they are now available in Bangladesh, it has helped reduce both cost and lead time.

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