Garment orders being suspended amid fuel crisis in the country, rising concerns

ছবিঃ সিএনআই

Staff Correspondent: Foreign buyers are reportedly suspending new purchase orders amid fears of a possible energy crisis in the country, raising concerns over Bangladesh’s export-oriented garment sector.
Bangladesh Chamber of Industries (BCI) President Anwar-ul Alam (Parvez) Chowdhury said that buyers are becoming cautious in placing orders as they fear the country’s energy situation may worsen in the next two to three months. This could put the country’s key foreign exchange earning sector—the ready-made garment industry—under serious risk.
He made these remarks on Wednesday (April 22) while participating in a pre-budget discussion held at the conference centre of the National Board of Revenue (NBR).
The BCI president said global market instability and domestic electricity and fuel shortages are increasing concerns among foreign buyers. He added that many orders scheduled for July and August have already slowed down. Some large buyers have started sending negative signals, and there is also a tendency to shift some orders to countries like India.
He further noted that while local liaison offices of foreign buyers are trying to manage the situation, decision-makers at their headquarters are becoming reluctant to place new orders in Bangladesh.
At the same time, he criticized the current tax structure as being unfriendly to business. He said the mandatory minimum tax of 1% on turnover—regardless of profit or loss—is creating significant pressure, especially for small and medium entrepreneurs. In many cases, businesses are being forced to pay taxes even without profit, making survival difficult.
He proposed restructuring the tax system for small entrepreneurs and called for a reduction in withholding tax on export earnings. However, NBR Chairman Md. Abdur Rahman Khan rejected the proposal to reduce withholding tax.
Regarding Section 147 of the Income Tax Act 2023, the BCI president said that the unrestricted power to seize computers or documents during tax audits is creating anxiety among businesses and increasing uncertainty in the business environment.
In the pre-budget discussion, the Dhaka Chamber of Commerce and Industry (DCCI) also demanded a reduction of withholding tax on bank deposit interest from 20% to 10% and the gradual abolition of surcharge on net wealth. They also called for a business-friendly tax structure instead of increasing the tax burden.
Industrial entrepreneurs believe that without stable energy supply and simplified tax policies, the competitiveness of the country’s export sector may weaken further.