Bangladesh's BTMA seeks loan concession, increased LC limit

Textile millers in the country have been in grappling with the current economic downturn and the devaluation of taka.

BTMA sought a two-year extension on loan repayment periods, which the central bank had earlier extended during the pandemic.

It asked for permission to exceed millers’ single borrower exposure limit if it occurred after the requested extension.

It requested a temporary reduction in loan instalments, proposing to pay only 20 per cent of term loan instalments. The remaining payments should be deferred for four years, the association argued, citing significant contractions in production and overall business.

BTMA also urged the central bank to either establish a consistent exchange rate for US dollars applicable to both export and remittance transactions or entirely deregulate the exchange rate and allow it to fluctuate freely on the market.

"It would not be possible for the local textile mills to sustain in such a situation if the mills do not get proper incentives and policy supports," BTMA president Mohammad Ali Khokon wrote.

"While the government's stimulus package helped us initially overcome the impact of the pandemic, our operations have been plagued by uncertainty for the past several months due to the combined challenges of the Russia-Ukraine war, the global economic crisis, the dollar crisis, and local political instability," he wrote.

The recent surges in the prices of gas, electricity, transportation and other raw materials have significantly affected the competitiveness and export capacity of the textile millers, making it increasingly difficult to compete in the global market, Khokon was quoted as saying by domestic media reports.

Fibre2Fashion News Desk (DS)