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The BKMEA president Salim Osman, in his letter to the members, said that the government is aware of the difficult time through which the industry was passing. He said that once the on-going restrictions were lifted, an appeal would be made to the prime minister for a stimulus package again. He said he believed that, as in the past, the prime minister would extend her cooperation in the future too.

As soon as the restrictions are lifted we will have to pay wages for July. But most of the factories will be facing a financial crisis as exports could not be made. That is why the government must take a decision for the stimulus package from beforehand.
Mohammad Hatem, vice president, BKMEA

In the start of the letter the BKMEA president said, the present variant of corona is lethal. That is why the government, in consultation with WHO, decided to enforce strict restrictions from 23 July to 5 August. The factories were not exempt from this. Banking and port-related services for imports and exports were functioning on a limited scale. Despite the financial losses involved, these restrictions must be followed to protect the people from the pandemic. This 14-day restrictions will affect the export plans, but this sacrifice had to be made to carry out business in corona-free conditions in the future. He requested the factory owners to follow the government’s restrictions and not to seek advice from any third party.

The BKMEA vice president Mohammad Hatem, speaking to Prothom Alo, said, “We had given a letter on 15 July to the prime minister through the cabinet secretary requesting that the factories be kept open during the restrictions. We explained all our points. As soon as the restrictions are lifted we will have to pay wages for July. But most of the factories will be facing a financial crisis as exports could not be made. That is why the government must take a decision for the stimulus package from beforehand.”

In March last year, due to coronavirus, work orders were cancelled and suspended, one after the other. The garment factory owners were alarmed and the government accordingly announced a Tk 50 billion (Tk 5000 crore) stimulus package to pay wages for three months – April, May and June. Service charges on these loans were 2 per cent. The garment industry owners then demanded loans for yet another month’s wages. The government acquiesced. The fund was expanded to Tk 91.88 billion (Tk 9188 crore). However, interest on the loan for the fourth month’s wages would be 4 per cent. The government subsidised the rest.

Though the package was declared for the workers and employees of export-oriented industries, most of the loans were taken by 1800 owners of readymade garment factories. The loan had a six-month grace period. However, towards the end of last year, BGMEA and BKMEA demanded that the grace period be extended. The government heeded to their demand once again. The finance ministry in the last week of February instructed the Bangladesh Bank governor to extend the grace period to repay the loan from the stimulus package by another six months from 1 March. So the installments of the loan are due to be paid from September.

In June, BGMEA president Faruque Hassan and BKMEA president Salim Osman had jointly appealed to the finance minister to extend the period to repay the loan till December. They wanted this facility so as to keep the export oriented garment and textile sector business running and the workers employed.

This year the government had imposed restrictions in April to tackle the second wave of coronavirus, but the export oriented industries, including RMG, could continue operations. The factories even remained open during the limited restrictions starting from 28 June and later the strict restrictions from 1 to 14 July.

However, all industries have remained closed since the strictest restrictions starting 23 July. Despite efforts and lobbying by five organisations including BGMEA, BKMEA and BTMA to remain open, the government did not relent. However, the tannery, pharmaceutical and food processing industries remain outside of the restrictions.

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