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Govt moves to set lifespan of new roads, buildings

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Govt moves to set lifespan of new roads, buildings

PMO issues directives on road and bldg maintenance

Syful Islam

The government has moved to determine the lifetime of all new public-sector roads and buildings to be built across the country, officials said.

The Prime Minister’s Office (PMO) has recently asked all the government secretaries to take steps in this regard.

The PMO directives on ‘road and building maintenance’ came amid reports on the construction of substandard roads and buildings by public-sector entities.

In the directives, the PMO said the authorities concerned will fix the lifetime of roads and buildings.

The ministries concerned will set annual allocation demand for maintenance cost of buildings, roads and other establishments under their departments and offices.

The secretaries have been asked to place a coordinated work plan to the cabinet division by next two months after setting the lifetime of buildings and roads.

The PMO will also monitor the road and building maintenance issue, the directive mentioned.

Officials said in recent times, the construction of substandard roads and buildings in the public sector was reported several times.

Even use of bamboos in some building construction works instead of iron rods also raised a hue and cry on several occasions.

It was also found that roads were getting damaged much earlier than expected time. Due to substandard maintenance work, construction materials, including bitumen, washed away very quickly.

As a result, maintenance cost of roads and highways increases further which is a waste of public money.

A senior official at the ministry of finance (MoF) told the FE that the government wants to stop wasting public money being spent in the name of maintenance cost of roads.

Besides, the government wants to ensure the quality in construction of roads and buildings so that they last for a long time.

The PMO directive was given to save public money, he noted.

Challenges for Bangladeshi exports to India

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Challenges for Bangladeshi exports to India

M S Siddiqui

Bangladesh imported products worth US$48.21 billion and exported $34.85 billion during the year 2016-17. Imports from Bangladesh to India are increasing at faster rate, but Bangladeshi exports to India are declining gradually. Over the past five years, trade between Bangladesh and India increased by 28 per cent, when it increased by 68 per cent with China. The largest bilateral trade partner for Bangladesh is China. In 2016-17 fiscal year, Bangladesh imported 14 per cent more products than previous year, amounting to $6.50 billion and exported only $ $672.4 million worth of goods. This is 1.72 per cent less than the amount exported in 2015-2016 fiscal year. The reduction is mainly due to imposition of anti-dumping duty on jute products.

Bangladesh faces various other Non-Tariff Barriers (NTB) under categories of (1) Sanitary and phytosanitary barriers, (2) Standardisation, (3) Quality, (4) Quantity, (5) Classifications, (6) Understanding of law and regulation of each other country.

After studying the trade in South Asia in 2015, Asian Development Bank (ADB) observed that the share of different trade barriers to SAARC countries are: (1) Sanitary and Phyto-sanitary (SPS), Technical Barrier to Trade (TBT), and Other Related Measures: 86 per cent, (2) Tariff Quota: 9.8 per cent, (3) Anti?Dumping Measures: 7.4 per cent, (4) License requirement: 5.3 per cent, (5) Countervailing measures: 1.2 per cent.

It is difficult to create an exhaustive list of NTBs as they tend to vary from consignment to consignment. Most NTBs are non-transparent and hence are difficult to identify. Some of them are state-mandated impositions or requirements, while others are sheer bureaucratic interference. The most commonly used NTBs are the following:

1) DISPUTE OVER CLASSIFICATION OF GOODS FOR CUSTOMS PURPOSES: The Indian Customs Authority sometimes refuses to accept the H.S. classification declared by Indian importers as per nomenclature rule and Letter of credit opened by Indian Banks. The authority has the propensity to classify the products under those H.S. codes that are subject to higher duties.

2) REQUIREMENT OF CHEMICAL TESTS: Indian Customs demands chemical test for most products. Since there is no testing facility near any land port, chemical tests take a long time forcing goods to be stranded for indefinite periods under the open sky. These requirements not only raise costs for Indian importers, but also results in harassment for Bangladeshi exporters. Problems are more for importers based in northeast India as most labs are located in the western India.

3) CUSTOMS VALUATION: The Indian Customs often refuses to accept the invoice value of the exported items and assesses the consignment on the basis of Retail Sale Price in India, which is higher than the invoice value. This is also against standard customs policy. This practice substantially raises the assessable value of the imported items and the buyers are forced to pay an extra amount as import duty and taxes. As a result, Bangladeshi exports become less competitive in the Indian market.

4) NON-ACCEPTANCE OF CERTIFICATES OF RULES OF ORIGIN: The Indian Customs officials sometimes refuse to accept the country of origin certificate issued by Bangladesh Export Promotion Bureau (EPB). EPB is the government organ, authorised to issue COO. Such refusal causes goods to be stranded indefinitely at the port of entry.

5) ARBITRARY IMPOSITION OF TARIFF VALUES: The fixing of tariff value is done by the revenue department. But Indian customs often impose this arbitrarily and change it without prior notice. The amount of import duty and taxes paid on the products goes up as a result, causing inconvenience for both the importer and exporter.

6) HEALTH AND QUALITY STANDARDS: Imposition of arbitrary health and quality standards favours domestic producers over foreign ones. The process of health and quality standard is very difficult for Bangladeshi products in India. Bangladesh exports medicine to many countries of the world including USA. But such items are not exported to India.

7) PERMITS AND LICENSES: Indian traders require obtaining Import-Export Code No. (IEC Number) from the Director General of Foreign Trade (DGFT) in Kolkata, for cross-border trade along the northeast. There is a distance of about 1,680 kilometres between Kolkata and Agartala. Due to such restrictions, Bangladesh and Tripura cannot take advantage of their geographical proximity to increase bilateral trade.

8) CONDITION FOR OBTAINING ISI CERTIFICATE: Bangladesh exporters of cement and building materials are required to obtain an ISI Certificate from the Bureau of Indian Standard (BIS) in New Delhi, if they intend to export their products to India. The huge cost as well as the complicated procedure for certification makes exporting to India very difficult.

9) REQUIREMENT TO COLLECT HEALTH CERTIFICATE: An Indian importer has to obtain a Health Certificate from the Port Health Officer (PHO) in Kolkata if he wants to import food items from Bangladesh. This is formidable barrier for importers in Northeast India, where the land customs stations are 1,060 km to 1,680 kilometres away from Kolkata.

10) SANITARY AND PHYTOSANITARY MEASURES: In order to import agricultural products in India, an importer has to obtain “Bio-Security” and “Sanitary and Phytosanitary” Import Permit. The process of obtaining this certificate is very complicated, time consuming and non-transparent. As such, this rigid process discourages trade in this sector between the two countries.

11) QUARANTINE REQUIREMENTS: Indian law has provision of obtaining quarantine certificates for importing “living organism”. This is mandatory under the Indian law. But the Indian Customs demands quarantine certificate even for jute and jute goods, though these are not living organisms.

12) TECHNICAL STANDARDS: Quality standard certificate by the Bangladesh Standards and Testing Institution (BSTI) is not accepted by India. India introduced mandatory marking for a number of products stating that these should comply with Indian Quality Standards set by the Bureau of Indian Standards (BIS). This requirement seriously hampers Bangladesh’s exports to India. Mutual recognition of each other’s standards can prevent this problem.

13) INADEQUATE LAND CUSTOMS INFRASTRUCTURE: There is an absence of warehousing facilities for imported goods in most land customs stations on the Indian side. As a result, goods exported by Bangladesh are kept in the open space till customs formalities for clearance are completed. This damages the exported goods and their inconsistent supply to the Indian market.

14) LABELLING AND MARKING PROVISION: The Indian authorities have made it mandatory to print some information such as the name of the country of origin, the maximum retail price etc. on all packaged imported items. Even the low cost jute bags are also included in this list. In July 2002, this requirement was made mandatory for all imported jute bags. At the time, India used to import 90 per cent jute bags from Bangladesh. Due to this requirement, the export of jute bags to India has significantly declined in the past years. Moreover, India has recently imposed new tariffs on the import of this product.

Bangladesh and India are members of the South Asian Free Trade Area (SAFTA), signatories of Asia Pacific Trade Agreement (APTA), signed Framework Agreement on BIMSTEC-FTA (BIMSTEC-Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Co-operation) and are members of IOR-ARC (Indian Ocean Rim-Association for Regional Cooperation). Both countries had agreed on preferential business relationship with reduced tariff and reduction of non-tariff barriers. Bangladesh, India and Nepal recently signed Sub-regional Motor Vehicle Agreement. Bangladesh has given full-fledged transit in the region through all modes of transport, e.g. road, rail and river to seven sisters in India.

According to SAPTA agreement, local content in the exported goods has to be at least 50 per cent of free on board or f.o.b. value of the product in order to receive preferential treatment / tariff concession. On the other hand, India and Bangladesh signed BIMSTEC agreement, which underlines 30 per cent value addition for exported products.

Under SAFTA, Bangladesh has secured a reduced sensitive items list and accelerated duty-free treatment for almost all items. Still Bangladesh experiences a modest level of nontariff barriers, and also a four per cent import tax on the readymade garment products, rebated to domestic traders from different states.

Bangladeshi exports to India are consumer goods like apparels, hosiery products, knitwear, leather shoes, fruit juices, jams and pickles, fish and fish products apart from raw jute and jute products etc. Both countries need to work closely to overcome these barriers to export from Bangladesh to India.

Trade deficit crosses $18b

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Trade deficit crosses $18b

Experts for exploring new markets alongside diversifying products

 Siddique Islam

The country’s trade deficit passed the $18 billion mark in fiscal year (FY) 2017-18 mainly due to higher import payments than lower export receipts.

Officials said the trade gap with the rest of the world rose to $18.26 billion in the July-June period of the just-concluded fiscal.

It was $9.47 billion in the same period of FY ’17.

The deficit recorded 92.76 per cent growth last fiscal, according to the latest Bangladesh Bank (BB) statistics released on Monday.

The data showed import expenses jumped by more than 25 per cent, but export earnings were recorded over 6.0 per cent growth.

The overall imports rose to $54.46 billion in the July-June period of FY ’18 from $43.49 billion in FY ’17.

In contrast, export income stood at $36.20 billion in FY ’18 against $34.02 billion in the previous fiscal.

Both economists and BB officials have recommended taking effective measures to expedite export earnings through exploring new markets to narrow the gap.

“The policymakers should explore new export markets along with diversifying products,” said Mustafa K Mujeri, former director general of Bangladesh Institute of Development Studies (BIDS).

Citing leather goods, the senior economist told the FE that there is scope to increase export earnings from other products apart from apparel.

A senior BB official spoke of the government’s move to explore new markets to boost foreign earnings.

The higher trade deficit further pushed up the current-account deficit despite an uptrend in remittance inflows, he told the FE.

The current-account deficit reached $9.78 billion during the July-June period of FY 18 against $1.33 billion in the preceding year.

The inward remittance, however, climbed by more than 17 per cent to $14.98 billion in FY ’18 from $12.77 billion in FY ’17.

“Macro-economic stability may be hampered if the current-account deficit continues,” explained Mr Mujeri, also the former chief economist of the BB.

He said the policymakers should ensure the receipt of hassle-free remittance with lower cost that will help boost the inflows further.

The higher inflow of medium- and long-term loans helped maintain a robust surplus in the financial account in FY ’18, according to the BB officials.

The financial account recorded a surplus of $9.08 billion despite the falling trend in the inflow of foreign direct investment (FDI).

Such surplus was $4.25 billion in FY ’17.

“The FDI fell slightly in FY ’18, particularly in the telecommunications sector,” an official said.

The gross FDI inflows decreased by 7.90 per cent to $2.80 billion in FY ’18 from $3.04 billion a year earlier, the BB data showed.

The net FDI flow also dropped by 4.23 per cent to $1.58 billion from the previous $1.65 billion.

The higher gap in trade and current-account reflects the growing imbalance in the external account.

It creates mounting pressure on the overall balance of payments (BoP).

The country’s BoP slid to $885 million in FY ’18 after a surplus of $3.17 billion a year ago.

The BB official, however, expects that the BoP will turn into a positive territory by the end of this fiscal from the existing level.

“The overall import payment pressure on the economy may decrease this fiscal due to bumper production of rice,” the central banker argued.

The overall import increased significantly in FY ’18, mainly due to high imports of food grains, fuel oils and capital machinery, according to the BB officials.

China to boost $3.8tr digital economy

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China to boost $3.8tr digital economy

Xi calls for self-reliance

Reuters, Beijing

China on Wednesday pledged to expand its $3.8 trillion digital economy and create jobs in new sectors such as big data and artificial intelligence (AI) as the world’s second-biggest economy looks to shift away from a reliance on polluting heavy industries.

China is in the midst of a long-term restructuring that has seen the decline of low-end industries and the emergence of higher-value factories that make products from robotics to drones.

But an intensifying trade war with the United States, China’s biggest trading partner, has stoked concerns that Beijing’s long-term plan to shift to high-end manufacturing under its ‘Made in China 2025’ plan could be jeopardized.

In recent months, Chinese government departments and agencies such as the National Development and Reform Commission (NDRC) have been affirming their commitment to long-term restructuring, which Beijing sees as a means to rely less on trade and other external growth drivers.

China will make further inroads in its digital economy including the internet of things, big data, clouding computing and AI, the NDRC said on Wednesday.

Those sectors will become new drivers of job creation by 2025, the state planner said.

China should embark on a path of self-reliance with the rise of unilateralism and trade protectionism, state-controlled People’s Daily quoted President Xi Jinping as saying on Wednesday as he conducted an inspection tour of factories in the rustbelt province of Heilongjiang.

This is not a bad thing, Xi said, as China will have to rely on itself in the end. Chinese state media has accused Washington of using trade to suppress the country’s development.

The NDRC said it will also step up financing support to help new industries expand, including drawing funds from capital markets.

Earlier this month, it signed an agreement with China Development Bank, a major policy lender, to offer 100 billion yuan ($14.55 billion) in financial support for the digital push.

China’s digital economy rose 18 percent to 26 trillion yuan ($3.8 trillion) last year, equal to a third of the country’s gross domestic product (GDP), according to the China Academy of Information and Communications Technology.

Traditional sectors will be digitalized, driving more workers to switch jobs, said the NDRC, adding that China will also look to attract foreign talent.

Beijing is banning the addition of new capacity in low-end manufacturing sectors such as textiles, furniture, food and chemicals, the Beijing Daily said on Wednesday.

But manufacturing of new energy vehicles and industrial robots will be allowed. The digital economy is also expected to help modernize agriculture, with China keen to rejuvenate aging rural areas, according to the NDRC.

Govt seeks funds from WB

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Govt seeks funds from WB

Star Business Report

Bangladesh has sent a proposal to the World Bank seeking finances for its $5.15-billion Ganges Barrage project, said Finance Minister AMA Muhith yesterday.

“I have given (to the World Bank) the Ganges Barrage project much earlier,” he told reporters after a meeting with WB Vice President for South Asia Hartwig Schafer at the Sonargaon hotel in Dhaka.

The Ganges Barrage scheme is a top priority project under the government’s 100-year Delta Plan 2100, which was approved by the National Economic Council on September 4.

The barrage project is one of the 80 top priority schemes to be implemented by 2031 at an estimated cost of about $37 billion under the Plan.

Muhith said the WB will surely participate in the Plan as it is Bangladesh’s largest donor.

Schafer told reporters that the good use of the WB’s financial support is reflecting in Bangladesh’s growth numbers. In the last fiscal year, Bangladesh used about $3 billion.

He said, “I am delighted to see how our support is improving the life of the people of Bangladesh and improving the prospects of the young generation.”

Schafer said the WB would help the country with knowledge and resources to strengthen its resilience to natural disasters. The vice-president visited various Rohingya camps in Cox’s Bazar on Monday and Tuesday.

Schafer said the Bangladesh government has provided tremendous support to the Rohingya refugees and the global community is recognising it.

“That’s why the World Bank is supporting the government to enhance its capacity to serve the refugees.”

Singapore firm invests $15m in Shohoz

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Singapore firm invests $15m in Shohoz

Star Business Report

Online ride-hailing and ticketing platform Shohoz yesterday announced it has raised $15 million from Golden Gate Ventures of Singapore to expand its business.

However, both Shohoz and Golden Gate Ventures declined to give the number of shares the investor will receive in exchange of the fund.

Jeffrey Paine, founding partner of Golden Gate Ventures, said the Singaporean company has received a minority stake in Shohoz through the investment and will sit in the board of the company.

At a press conference at the Pan Pacific Sonargaon Hotel in Dhaka, the ride-sharing startup officially announced the development and said the fresh capital will be used for customer acquisition and retention of the ride-sharing business as well as for expanding other on-demand car services.

“Our market is ready for a thriving ride-sharing and related businesses and within a short time we will move beyond Dhaka to expand our service across the country,” said Maliha Quadir, founder and managing director of Shohoz.

“This additional money will be helpful to expand and make new acquisition.”

Shohoz began its journey four years ago with some angel investment and started the ride-sharing service in January this year. It is the market leader in e-ticketing.

In the ride-sharing business, Shohoz’s focus is on the bike segment. It rolled out the car-sharing service last week.

It is now working to introduce insurance for both riders and passengers within a short time, said Maliha.

She said the venture is planning to roll out the on-demand car service although the bike-sharing will remain its priority.

“Motor bikes will help reduce traffic congestion in Dhaka and make city-dwellers life faster and smoother.”

Paine said Golden Gate Ventures has interests to invest more in Bangladesh, especially in the tech-related startups.

He said Bangladesh has all the indicators of a country poised for tremendous growth: increasing digitisation of consumer services and rising consumer purchasing power. Golden Gate Ventures is an early-stage venture capital firm investing across Southeast Asia.

Since 2011, the firm has invested in more than 30 companies in a number of countries in Asia. It invests in internet and mobile startups in sectors such as e-commerce, payments, marketplaces and mobile applications, according to the company’s website.

Banks’ profit rises 20pc

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Banks’ net profit soared 19.55 percent in the first six months of the year, compared to the same period a year ago, propelled by impressive performance by a few private lenders.

Between the months of January and June, the banks raked in profits of Tk 2,206 crore, according to the provisional data received by the Bangladesh Bank.

During the period, they logged in operating profit of Tk 11,358 crore, from which Tk 3,929 crore was deducted as tax and Tk 5,223 crore as provisioning against bad loans.

In truth, only a few banks managed to bag handsome amounts of profit, which has flattered the entire sector’s performance in the first half of 2018, said a BB official.

“It is not possible to register net profit growth if default loans are on the rise,” he said, adding that most of the banks either managed marginal profit or faced negative net income in the first half of the year for the spiralling default loans.

As of June, the banking sector’s total default loans stood at Tk 89,340 crore, up 20.23 percent from six months earlier.

Banks that were able to restrain their non-performing loans registered good net profits, said MA Halim Chowdhury, managing director of Pubali Bank.

Pubali’s net profit more than doubled to Tk 203 crore in the first six months of this year.

“We kept huge amounts of provisioning against our default loans last year. But in recent months, we have successfully managed to control our classified loans, which ultimately had a positive impact on our net income.”

Among the private banks, Brac Bank recorded the highest net profit of Tk 643 crore, followed by Standard Chartered at Tk 499 crore, Sonali at Tk 327 crore and Islami at Tk 312 crore. Brac Bank Managing Director Selim RF Hussain, however, disputed the figure put out by the central bank about his bank’s net profit in the first half of the year.

“This figure is not correct and my bank did not log such a large amount of net profit in the period,” he said.

The bank’s financial report showed that its net profit after tax stood at Tk 273 crore.

Among the private lenders, Bank Asia put up a strong showing in the first six months of the year: its net profit shot up 75.71 percent year-on-year to Tk 123 crore, according to data from the central bank.

The bank’s balance sheet has expanded substantially in the recent period, which was reflected on the higher net income, according to Md Arfan Ali, managing director of Bank Asia.

Syed Mahbubur Rahman, chairman of the Association of Bankers, Bangladesh, a platform of the managing directors of private banks, said banks should not be complacent about the half-yearly net profit data as the picture may change at the yearend.

He, however, said that the net profit growth is linked to the private sector credit growth.

“The credit growth ranged from 18.36 percent to 16.96 percent between January and June. So it was logical that the sector’s net profit grew 20 percent,” said Rahman, also the managing director of Dhaka Bank.

The six state-run banks, however, collectively registered a net loss of Tk 1,234 crore in the first half, against Tk 1,047 crore a year earlier.

Major trade deal with India on the way

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Major trade deal with India on the way

Refayet Ullah Mirdha

Bangladesh and India yesterday agreed to sign the Comprehensive Economic Partnership Agreement (CEPA), a greater economic cooperation deal, with the view to boosting bilateral trade.

Indian Commerce Minister Suresh Prabhu and Bangladesh’s Commerce Minister Tofail Ahmed announced the signing of the deal at a joint press conference after a delegation meeting between the two countries in Dhaka.

They, however, did not mention any specific date for the inking of the trade deal.

“We will sign the CEPA for continuation of duty benefit on export to India even after graduation from the least developed country bracket to a developing one in 2027,” Ahmed said at the press conference. Currently, Bangladesh as an LDC enjoys zero-duty benefit on exports to India for all goods save for 25 alcoholic beverage items.

Trade analysts said Bangladesh stands to benefit from the deal if it is negotiated carefully.

The CEPA is a greater partnership deal between two countries or with any trade bloc, under which special treatment is considered in areas of trade, investment, energy cooperation, logistic support and so on.

For instance, there is a possibility of more Indian investment in Bangladesh, more energy cooperation and aid for trade between the two countries under the CEPA deal as it is considered as a greater partnership, said Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue.

Under the partnership agreement, both countries will work towards improving the logistic and trade-related capacities of Bangladesh.

“In this case, both countries will have to recognise their economic differences,” Rahman said, adding that the duty-free export of goods from Bangladesh to India will have to continue even after signing the CEPA.

The CEPA might not affect the local industries as it is a partnership deal only, said Ahsan H Mansur, executive director of the Policy Research Institute, another think-tank.

“There is nothing wrong if the deal is signed. There is scope for more investment from India and preferential treatment in trade,” he said.

India has signed the CEPA with some countries like South Korea and Japan and is in negotiations with the ASEAN (Association of South East Asian Nations) to hammer a similar deal.

Apart from the CEPA, the ministers also talked on some other pending issues that are acting as impediments to the growth of bilateral trade.

Prabhu has assured that his government will work on lifting the anti-dumping duty on the export of jute and jute goods to India.

Local exporters were left with their hands tied to their backs after India in January last year imposed an anti-dumping duty of up to $352 on jute and jute goods.

Prabhu also said India will accept the certification of the Bangladesh Standards and Testing Institution. “We have decided to address the issue of the BSTI.”

Bangladeshi exporters have been complaining that the Indian side does not accept the certification of the BSTI although the neighbouring country had previously agreed to accept the country’s standards certification for 21 items.

This time, the Indian side has agreed to accept the certification for 27 Bangladeshi goods, Ahmed said.

The two ministers said six more border haats will be set up soon.

Currently, four such haats are in operations and another one along the Dalu-Nakugaon border will be opened within one month, Ahmed said.

Prabhu said India would be a $10 trillion economy by 2035, so Bangladesh has an opportunity to attract more Indian investment as a partner country.

He went on to invite Ahmed to attend a Bangladesh-focused investment conference scheduled to be held in India next month or in November.

Prabhu also invited the Bangladeshi minister to attend the partnership summit to be held in India in January next year when Bangladesh will have the opportunity to bag more Indian investment.

He touted the tourism sector as a major job creator and advised Bangladesh to promote the tourism facilities in the Sundarbans, which spans the two countries.

A joint communiqué issued on the outcomes of the meeting said Ahmed encouraged the Indian investors to invest in the special economic zones being developed by the Bangladesh Economic Zones Authority across the country.

Recognising the importance of Petrapole-Benapole land ports, the ministers agreed to remove impediments affecting smooth clearance of cargo at this location.

They agreed for a one-time push to remove congestion of cargo trucks with effect from October 15 this year for a period of two months, the communiqué said.

They also agreed to support the improvement of infrastructure of land customs stations in Bangladesh adjoining Tripura border.

Noting the need to restore the pre-1965 railway connectivity between two countries, the Bangladesh side proposed a new end-to-end train service between Dhaka and Siliguri with customs and immigration checks at the starting points at both ends, according to the joint communiqué.

Bangladesh demands better prices for garment items

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Bangladesh demands better prices for garment items

Star Business Report
Bangladesh sought better prices for its export items, especially garments, from the US retailers and brands in the fourth round of Ticfa meeting held in Washington on Thursday.

In the event of the Trade and Investment Forum Agreement (Ticfa), Bangladesh also demanded duty privilege for all the products of its export basket to the American markets.

Bangladeshi garment makers have been re mediating the factories as per the recommendations of the Accord and Alliance—building inspection and remediation agencies—which will cost them nearly $3 billion.

The tenure of both the western agencies will end in December this year.

But the western buyers still do not want to raise the prices a bit in an excuse of a fall in demand for apparel items in their countries, including the US, the commerce ministry said in a statement.

In the meeting, Bangladesh also sought increased investment from the US, according to the statement.

Bangladesh also reminded US of the Bali declaration of the World Trade Organisation in 2013, when the developed nations agreed to give duty waiver to the goods of least developed countries.

In Bali, they also gave word to offer duty benefits to 97 percent of the goods originated from the LDCs, if duty waiver to all goods is not possible.

Bangladeshi products also enjoy the duty waiver, but the US kept garment items—the main export item of Bangladesh—out of the 97 percent package’s list.

Currently, the garment makers have to face a 15.62 percent duty for export to the US.

The overall value of Bangladesh’s exports to the US increased 5.83 percent year-on-year to $3.63 billion in the first seven months of this year thanks to higher apparel shipments, US Census Bureau data shows.

In the period, apparel exports to the American markets grew 5.61 percent year-on-year to $3.21 billion and Bangladesh became the third—moving up from the sixth position—highest garment exporter to the US, according to data from the US Office of Textile and Apparel.

Garment items account for over 90 percent of Bangladesh’s total export value and the US is its largest garment export destination. In June 2013, the US government suspended Bangladesh’s trade privilege—the Generalised System of Preferences—citing poor labour rights and workplace safety.

The trade privileges are yet to be reinstated, although Bangladesh lobbied the US government after improving the labour standards and workplace safety, the commerce ministry said. The US duty free import benefit under the GSP programme is extended only to some LDCs in the Sub Saharan areas under the African Growth and Opportunity Act.

Bangladesh also demanded US cooperation for sustainability of its economy after the country’s graduation to the developing country’s category. In the Ticfa meeting, the US representatives urged Bangladesh to import more American cotton and improve intellectual property rights.

The US side in the meeting also discussed the procurement policy and labour rights issues of Bangladesh.

The meeting was co-chaired by Shubhashish Bose, commerce secretary, and Mark Linscott, assistant US Trade Representative (USTR) for south and central Asian affairs, according to a statement from the USTR. Earlier, the US and Bangladesh had signed the Ticfa agreement in November 2013 mainly to revive the GSP to the US markets.

Go for rooftop solar panels to raise power output

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Go for rooftop solar panels to raise power output

Experts urge factory owners

Star Business Report

Factories should make the best use of their rooftops by installing solar panels to get power for their own consumption and for the national grid, experts said yesterday.

The cost of electricity generation will be much lower than that of the grid power if rooftop solar panels are used, said Tawfiq-e-Elahi Chowdhury, the prime minister’s energy adviser.

At the same time, the factories would be able to sell their excess electricity at the tariff rate of the grid power, he said.

He spoke at a seminar on “Net metering: opportunities and challenges” at the National Press Club in Dhaka.

The Forum for Energy Reporters Bangladesh (FERB) and the Solar Module Manufacturers Association of Bangladesh (SMMAB) jointly organised the programme.

Net metering is a billing mechanism that credits solar energy system owners for the electricity they add to the grid.

The government has enacted the guideline for net energy metering, which is a business model, said Mohammad Hossain, director general of the Power Cell under the power division.

“Now it is up to the industries and businesses to harness the power of home and rooftop solar panels.”

The government had earlier made it mandatory to install solar home and rooftop systems with every new power connection, but the initiative had failed to yield good results, he said.

Bangladesh has pledged to have 100 percent renewable energy by 2050, said Munawar Misbah Moin, president of SMMAB.

The goal number seven of the sustainable development goals calls for ensuring access to affordable and clean energy by 2030, he said.

“Net metering is a significant step to achieving the goals,” he said while making a presentation.

Bringing a change in the mindset is required to shift the focus from the existing centralised and fossil fuel-based power to clean and locally generated electricity, said Moin, also group director of Rahimafrooz (Bangladesh) Ltd.

He said it is technologically proven that solar home systems can supply power to the grid. The entrepreneur added the price of solar panels has gone down by 30 percent to 40 percent in the last five years and it would fall further.

Net metering reduces dependence on the grid power and cuts electricity bill of customers by way of lowering the use of electricity from the grid, said Shakila Aziz, assistant professor of the United International University. It also contributes to the reduction of greenhouse gas emission through promoting generation of electricity from renewables while lessening the country’s reliance on fossil fuels, she said during a presentation.

She proposed introducing a number of incentives for promoting rooftop solar panels — providing such panel users with cuts in income tax, value-added tax and exemptions from property tax.

Arun Karmaker, FERB chairman, and Sadrul Hasan, executive director, also spoke.