The Bangladesh Textile Mills Association (BTMA) has urged the government to adopt three key policy measures in the proposed national budget for 2026-27 to safeguard the country’s primary textile industry and maintain its competitiveness in the global market.
Speaking at a special press conference held at Gulshan Club in Dhaka on Saturday, BTMA President Showkat Aziz Russell emphasized the need for the reinstatement of the 30% value addition requirement for raw material imports under Bank Guarantee facilities, the withdrawal of the proposed 5% Customs Duty (CD) on Polyester Staple Fibre (PSF), and the reduction of the corporate tax rate for the textile sector to 12%
President Showkat Aziz Russell said that the removal of the 30% value addition condition could expose domestic manufacturers to unfair competition and increase the risk of misuse of bonded facilities. He noted that maintaining the requirement is essential for protecting local industries and ensuring higher value addition as Bangladesh prepares for LDC graduation.
Regarding the proposed 5% Customs Duty on PSF, a key raw material for Man-Made Fibre (MMF)-based yarn and fabric production, BTMA warned that the additional duty would increase production costs for local spinning mills and hinder Bangladesh’s efforts to diversify its apparel exports into the rapidly growing MMF segment.
The association also highlighted the tax disparity within the textile-apparel value chain. While export-oriented garment manufacturers enjoy lower tax rates, primary textile manufacturers face significantly higher tax burdens. BTMA therefore called for a reduction in the corporate tax rate to 12% to encourage investment, enhance competitiveness, and support sustainable industrial growth.
BTMA stated that the domestic textile sector, which has attracted investments of around USD 23 billion and provides employment to millions of people, is currently facing multiple challenges, including rising energy costs, high interest rates, liquidity shortages, and increasing yarn imports. The association urged policymakers to take immediate action on these demands to protect local manufacturing, strengthen backward linkage industries, and sustain Bangladesh’s export competitiveness in the post-LDC era.
