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Bangladesh exports feel the heat of low pricing..

Written By Views maker on June 02, 2009 | 6/02/2009

Bangladesh Export Promotion Bureau data show a 0.22 percent decline in the price index of all products, including RMG, in March, while the February decline was 2.29 percent. In the case of primary products, the price index declined to 4.90 percent in July-March period, compared to the 14.08 percent in the first eight months of the outgoing fiscal year.

A low price now being offered for apparels from international buyers has become a concern for Bangladesh exporters,every year buyers are cutting prices of Bangladesh made readymade garment (RMG) products, although raw material prices are on the rise. on the back of ongoing global financial meltdown and higher costs of doing business.

The exporters lament they are offered a price that is 10 percent lower than they were offered before the recession, for which they could hardly make any profit.

However, some exporters see the new buyers' leaning towards Bangladesh as a positive side. A considerable number of buyers arrive here to place export orders because they find the RMG prices in other countries higher.

Despite around 20 percent rise in the cost of doing business last year, an intense competition in the sector meant producers had been unable to pass the higher costs on to buyers.

Erratic gas and power supply, higher cost of fund, higher freight charges--both in local and international markets, yarn price hike, implementation of the minimum wage for workers, higher transport costs, weak infrastructures and higher prices of capital machinery caused such a higher cost of doing business.