The New Nation - Internet Edition

ACCORDING to a recent media report, increased procurement of cotton and equipment for local textiles and apparel units are pushing up Bangladesh's imports from the United States of America, helping the world's biggest economy reduce trade gap. Textile and garment factories are buying more captive electricity generators, sewing machines and other machinery from the US in recent times than in the past. The volume of the cotton import from USA still remains low compared to Bangladesh's total import of cotton, but it is growing steadily. Bangladesh could grow as a significant market for US cotton suppliers if the American authorities offer some incentives to Bangladeshi spinners. Official sources reportedly said that in nine months by September, US exports to Bangladesh stood at $322 million. Bangladesh's annual imports from the USA amounted to $333 million in 2006 and $319 million in 2005.

Increase of imports is helping the United States to reduce trade gap with this South Asian country to some extent in the current year as observed by the people involved in the trade. In 2006 textile industry's procurement bills from US suppliers crossed $110 million which was more than one third of Bangladesh's total imports from the USA. Spinners of Bangladesh, on the other hand, imported American raw cotton worth $38 million, textile and sewing machinery $24 million and fine fabrics $10 million. Procurement values for generators and textile machinery increased by around 50 per cent over the year. The US suppliers, in fact, are finding now a big market in Bangladesh. Although Bangladesh is the world's second largest cotton importer, the market share of US suppliers had so far been limited. Higher price, longer shipment time and technical preferences for CIS and Indian cotton had kept cotton supply from the United States limited as pointed out.

Garment exporters, on the other hand, earned $9.2 billion or 76 per cent of Bangladesh's entire export proceeds in the last fiscal year ending in June, with USA alone accounting for $3 billion. There are, however, suggestions from spinners at this end that the US should guarantee American cotton suppliers delayed payments (after-use payments) for cotton sold to Bangladeshi spinners. 'Such government-government arrangement could protect local spinners from high charges on cotton import financing and lure them to procure US cotton. American cotton traders can sell more to Bangladesh by supporting Bangladeshi exporters to market more products in USA. The US government may arrange preferential market access for Bangladeshi garments made with American cotton. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) recently urged the government to pursue the US administration and American Congressmen to pass the proposed New Partnership Development Act-2007 that will be tabled between end of January and February for providing preferential market access in USA. The government and the BGMEA should join efforts to secure this for the benefit of the industry.