Pak towel maker to set-up Tk 300m industry in CEPZ

http://www.theindependentbd.com/business/finance/74181-pak-towel-maker-to-set-up-tk-300m-industry-in-cepz.html

Pak towel maker to set-up Tk 300m industry in CEPZ
Author / Source : MASHIUR RAHAMAN

DHAKA, OCT 7: A renowned Pakistan based towel manufacturer is going to set-up a towel factory in Chittagong Export Processing Zone (CEPZ) with initial investment  of Tk300 million, top company official told The Independent. Pakistan traditionally has a rich heritage of high-quality towel manufacturing and enjoys high demands in Western markets, Sumara Haleem Puri, proprietor of the First Women Fashion of Pakistan said.

“Our investment in CEPZ will not only pore in foreign invest in Bangladesh but also expertise to enrich the thriving local garments industry,” he added.

Mr Puri, in collaboration of his local partner, has already acquired land to set-up the towel factory. Construction works of the industry will began in early 2012 and expected to go for commentarial production by the end of the same year.

“We have monthly manufacture plan of 800 tons. Entire products of this establishment will be exported to European markets,” Mr Puri said.

Pakistan’s once-thriving textiles industry now faces hard time. In a country plagued by political violence and longstanding energy crisis, investment drain-out has forced the textile business to move to other countries, most notably, Bangladesh.

Industry experts said conditions in Bangladesh are favourable and this is luring Pakistani businessmen to relocate or expand their business to Dhaka. They cited certain advantages for Pakistani businessmen in Bangladesh, such as having a common history and culture, more investor-friendly policies, cheap labour and tax-free access to 37 countries, including the European Union, Canada and Australia.

“It is true that Bangladeshi bureaucracy is sometimes ‘old-style’ that takes time in doing things but when you are bringing foreign investment into the country, they are the most cooperative,” he claims. As per primary business plan, the new towel factory will employ about 300 low-skilled workers who will eventually be trained up by Pakistani expert machine operators, he said.

“Bangladeshi workers are quick learner and they will be trained up as experts to handle the entire production activities,” he added.

Classified as a least-developed country, Bangladesh enjoys duty-free export facility to 27 European Union countries, and 10 other developed countries, including Japan, Canada and Australia, under bilateral agreements. Pakistan, on the other hand, faces higher tariffs in the EU and US markets, putting its exporters at a disadvantage.

Easy availability of cheap labour has enabled Bangladesh to join the global supply chain for low-end textiles and clothing. It has also helped the country to manufacture garments for international brands, such as JC Penney, Wal-Mart, H&M, Kohl’s, Marks & Spencer and Carrefour.

“Apart from the worsening law-and-order situation in Pakistan, labour cost is much higher in my country along with chronic power crisis,” Mr Puri said.

Last year, Bangladesh nearly doubled its minimum monthly wage to Tk 3,000 for workers in the garments industry. However, the pay is still low compared to China, India, Vietnam, Thailand and Cambodia. At a government-set Rs 7,000 (USD 80.55), Pakistan’s minimum monthly wage is much higher than that in Bangladesh. While Bangladesh has its own power problems, facing up to 2,000 MW of shortage, it is taking firm steps to address the energy crisis.

The government is aiming to triple power generation to 15,000 MW over the next five years, and plans to build 89 power plants on a fast-track basis.

“On top of everything, it is the business friendly attitude of Bangladesh government that makes investment in to this country relatively safer as compare to mine,” he said adding that he is looking forward for a prosperous business growth in this country. “Depending on investment outcomes, we will consider further investment in Bangladesh in near future,” Mr Puri added.

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