FROM THE EDITOR-IN-CHIEF ’ s DESK …
The Bangladesh RMG industry is passing through a phase of uncertainty ; while no one doubts that sustainability and employee engagement are the way forward , some policy and industry movements have raised eyebrows .
The country is known for its Green factories and this has become a huge image-building tool in the last few years … Buyers and NGOs alike have praised the industry for investing in Green factories and featuring among the best in the world .
But what surprises me is the Government ’ s proposed hike of corporate tax for Green factories from 10 per cent to 12 per cent … One would expect that the Government would in reality make it worthwhile to be Green and give incentives to encourage many more such initiatives .
The argument for increasing the tax is simple . Since the Government has proposed hike of corporate tax from 12 per cent to 15 per cent in the apparel sector in FY ’ 19 , some hike is obviously applicable to Green factories also .
It is being debated that as a corporate , even companies having Green establishments have to pay corporate tax , but owing to their Green status , they get a concession of 3 per cent …, which according to the policy makers , is the incentive to go Green !
How far this logic is acceptable , is a matter of debate , but it has already become a dampener on the players who were ready to invest in Green factories . What will eventually happen is anyone ’ s guess , but it has left the industry , unhappy and confused …
Already many companies have openly admitted that buyers are not paying a single cent more for operating out of Green factories , so whatever gain is derived from such initiatives is perceived and long term . This additional burden could , in fact , slow down the movement .
Another development that has caught the attention of the industry is the extension of the Alliance-Accord for only six months , despite expectations and indications that the Accord would receive an extension until 2021 . Recently , the nation ’ s Minister for Commerce indicated a change of mind , claiming that neither the Accord nor the Alliance would likely receive an extension beyond December 2018 .
Further complicating the matter , some key retailers / brands have decided to pull out of the extension raising questions on the credibility of the initiatives created for putting in place safety norms for factory workers .
The short extension of the Accord-Alliance , followed by the Government ’ s strong warning to the industry that garment factory owners who are non-compliant regarding the deadline of December for remediation work to be undertaken , would face factory closures , clearly indicates that the Government intends to take over the responsibility for safety regulations by the end of this year .
How well this move will work for the industry , only time will tell , but one thing is for sure … New directions are definitely on the cards !
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EDITOR-IN-CHIEF EDITOR DEPUTY EDITOR COPY EDITOR ASST . COPY EDITOR SUB EDITOR CREATIVE TEAM
PHOTO EDITOR OPERATION DIRECTOR
Deepak Mohindra Ila Saxena Deepankar Shyam Veereshwar Sobti Sahil Sehgal
Priyanka Mishra
Raj Kumar Chahal Peeush Jauhari Satyapal Bisht
Gaurav Naroola Mayank Mohindra
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8 Apparel Online Bangladesh | July 2018 | www . apparelresources . com