Adequate power can boost int’l market of plastic items

Adequate supply of power can boost to a great extent the domestic and international markets of plastic items, which will play an important role in the country’s economy.
But the country’s plastic industries are now facing serious setbacks due to power crisis, said Ferdous Wahed, the president of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA).
Talking to the news agency, he said that power is a big factor in the plastic industry – a heat consuming industry.
“Load shedding has really been a massacre for the plastic industry and still there is no sign of improvement,” Ferdous said adding that they had to often incur loss of production due to power disruption.
He said that after the major export-earning Ready Made Garment (RMG) sector, the plastic sector could raise its potential as its value addition is very high.
“There is no labour unrest and complaints about salary, as the workers are getting good salary. It’s a growing industrial sector having growth rate of 20-30 per cent a year.”
He, however, said that the expected growth in the current fiscal could not be achieved due to power crisis.
Ferdous informed that the BPGMEA in its recent budget proposal to the NBR suggested to include plastic industry among the highest priority sectors in export as there has been an international market of around Tk 1600 crore including Tk 400 crore in direct form and Tk 1200 crore in deemed form (indirect export). Besides, the domestic market size of plastic goods is around Tk 4,000 crore.
He also demanded withdrawal of the NBR circular on ‘Import Under Bond, Not For Sale’, as he thinks this is a hindrance on the growth of the plastic sector.
He said as the multinational petrochemical companies like BASF, SCG, Chevron, Basell and Remex refused to supply raw materials as per the NBR circular, “we had to give 100 per cent bank guaranty for which a bulk of our working capital remains blocked with the Customs.”
The BPGMEA president also emphasised promoting recycling of plastic wastes, so it could reach 100 per cent compared to existing recycling rate of 60 per cent in the country. “Even with 60 per cent recycling, we could make a savings of US$ 400 million in the year 2005 by avoiding import of virgin resin,” he said. Ferdous informed that private entrepreneurs from India, China, Taiwan and Thailand are very keen to invest in Bangladesh’s plastic sector, but these investments would come only if uninterrupted power supply is ensured.
The export of plastic items began in the later part of the 1980’s in the form of indirect export (deemed export) mainly as backward linkage for RMG sector, he said.
According to statistics provided by the Export Promotion Bureau (EPB), the export earnings of plastic items totaled US$ 56.78 million in the 2008-09 fiscal and US$ 54.14 million in 2007-08 fiscal. The major export destinations for the Bangladeshi plastic items were China, Poland, UK, Belgium, France, Germany, USA, Canada, Spain, India, Nepal, Bhutan, Australia, Sri Lanka, Japan, Malaysia, UAE, Hong Kong, Bahrain, Italy, New Zealand and the Netherlands. Some 1 million workforces are now directly and indirectly employed in some 3,000 small, medium and large plastic goods manufacturing units.
Although plastic goods are exported in direct and deemed way, some directly exported plastic items are PVC Pipes, PVC bags, insulator (rubber), polythene sheet, plastic hanger, hand gloves (rubber), synthetic ropes, plastic waste, V belt, polyester thread, computer accessories, and video and audio cassette.

Courtesy of UNB via The Independent