Bangladesh sees the United States’ decision to strip India of Generalised System of Preference (GSP) as a scope to scoop up more readymade garment orders than the neighbours.
“We will obviously benefit from India losing out on the GSP privilege,” said Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Rubana Huq.
“It is a scope for us to get more orders but it’s difficult to say how much,” she added.
Huq, who is the first woman ever to become a BGMEA chief said that their real success would be to bag the orders India loses which will otherwise go to countries like Cambodia and Vietnam.
“It’s not a fixed thing that we’ll get the orders India loses out on. It depends on the buyers. There’s nothing we can do if they want to buy clothing from India at higher prices.”
Saying that India used to get GSP privilege on products worth $5.7 billion, she added, “We don’t know how much of that was readymade garments.
“However Indian traders say that being stripped of the GSP will cause loses of more than $100 million.”
Meanwhile, Policy Research Institute (PRI) Executive Director Ahsan H Mansur doesn’t think that the Bangladeshi garment sector will see much benefit from India’s loss.
“The United States stripping India of GSP might benefit Bangladesh but it will be quite insignificant,” he said.
He added that it would have been more beneficial if they had returned Bangladesh’s GSP privilege and while the RMG sector won’t see much profit from it, the ‘non-garments’ product sector might be lifted a little from the move.
United States President Donald Trump announced on Friday (May 31) that India’s GSP privilege has been scrapped.
According to him, the country didn’t assure entry of acceptable products to the US and hence the move.
The United States started the GSP Project in 1976 in order to allow developing countries to export selective products in the US market free of taxes.