Foreign buyers warn of energy crisis, RMG orders on decline: BCI president
“In the last one week, four major international companies told me that their top management is not approving orders because they fear there may not be reliable electricity in Bangladesh,” he said.
Foreign buyers have begun scaling back export orders as concerns over Bangladesh's energy stability and "negative messaging" regarding fuel shortages rattle international markets, Bangladesh Chamber of Industries (BCI) President Anwar-Ul-Alam Chowdhury (Parvez) said today (22 April).
"Negative messaging is going out. I think we should be more careful in what we say. We keep saying we have fuel shortages and gas issues. Foreign buyers are now getting concerned. They are starting to say 'your country will not even have sufficient gas'," he said during a pre-budget discussion in the capital.
He noted that concerns over electricity supply and overall economic stability in Bangladesh are growing among international buyers. As a result, several sourcing companies are increasingly shifting orders to India and other competing markets.
Keep updated, follow The Business Standard's Google news channel
According to him, expected purchase orders for July and August have slowed significantly, with multiple large buyers already expressing caution. While liaison offices in Dhaka are attempting to manage concerns, top-level management abroad is becoming more reluctant to place new orders.
"In the last one week, four major international companies told me that their top management is not approving orders because they fear there may not be reliable electricity in Bangladesh," he said.
He also warned that several global buyers have started sending similar signals, adding that the readymade garment sector could come under pressure if the trend continues.
Beyond energy concerns, Anwar-Ul-Alam pointed to global market volatility and domestic structural issues as additional reasons behind the slowdown in export orders.
He said the expected order flow for the upcoming July-August period has largely stalled.
He further criticised the existing tax framework for small entrepreneurs, calling it unrealistic under current business conditions.
According to him, the requirement to pay a minimum 1% tax regardless of profit or loss is becoming increasingly burdensome.
"If small entrepreneurs can be brought under a proper tax slab system, it would help them survive. Even when there is no profit, they are still required to pay tax, which is putting them under serious pressure," he said.
He also called for a reduction in withholding tax on export earnings.
