Spinners upbeat over Uzbek cotton co-op

http://www.newagebd.com/2010/nov/15/busi.html#2

Spinners upbeat over Uzbek cotton co-op
Kazi Azizul Islam

Local spinners were upbeat as the government of Uzbekistan, the largest source of cotton for Bangladesh, has assured of directly supplying quantity cotton.

The Uzbek government made the offer to a visiting Bangladesh delegation, led by commerce minister Faruk Khan, and also asked Bangladeshi entrepreneurs to set up spinning units in the central Asian country.

Apart from producing quality cheap yarn, the proposed spinning units could export at least half of their outputs to Bangladesh and feed the country’s $13 billion-plus, mainly cotton-based, apparel export industry.

‘A new dimension was added to Bangladesh’s relations with Uzbekistan with the proposed cooperation in cotton and textiles sector,’ Badsha Mia, a leading spinner and member of the Bangladesh delegation told New Age.

Bangladeshi spinners procured over 0.9 million tonnes of cotton last year and at least half of that came from Uzbekistan, one of the largest cotton growing countries.

The Swiss and French cotton merchants supply major portion Uzbek cotton deliveries to Bangladesh, Badsha said, pointing out that latest move following the visit of Bangladesh delegation would result in more direct sourcing from the central Asian country.

Bangladesh urged the Uzbek authorities to allocate big portion of their exportable cotton stock as quota for Bangladesh and called for taking measures so that Uzbek banks would accept letters of credit from Bangladeshi banks to facilitate direct trade between the two countries.

Mazhar-Ul Haque Bhuiyan, managing director the Ekhlas Spinning Group, said, direct sourcing of cotton from Uzbekistan would be very helpful for Bangladeshi spinners as the industry here mostly depend on middlemen who inflate cotton price.

Ekhlas Group with its three spinning units of some 3,50,000 spindles capacity, the largest in the country, procures most of their cotton requirements through middlemen. Mazhar said direct sourcing of cotton would benefit the Bangladeshi spinners.

He said the Uzbek offer to Bangladeshi spinners for setting up spinning units in that country also appeared to be a potential proposition. ‘As they have abundant supply of cotton as well as electricity, the Bangladeshi entrepreneurs can set up units in Uzbekistan taking workers from Bangladesh.’

Local spinners started suffering following a ban on cotton exports by India in April this year and the situation worsened with cotton price in international markets soaring record high in recent weeks.

Monoj Kumar Roy a joint secretary of the Commerce Ministry, who was also a member of the delegation to Uzbekistan, said their visit would help strengthen Bangladesh’s cotton cooperation with Uzbekistan, the world’s third largest cotton exporter.

He said that a joint-commission would be formed soon with the government representatives of two countries and the private sectors to follow up trade in cotton and other products and deal with investment issues between the two countries.

‘Cotton has become a burning issue now, so any potential bilateral corporation in trade and investment in the cotton and textiles sectors will be pursued,’ said Roy.