Published in The Financial Express on Saturday, 11 January 2015.
Govt assessing performance of privatised jute, textile mills
Move to get back the sick ones
Arafat Ara
The government is assessing performance of privatised jute and textile mills in a bid to get back poor performing ones from the private sector, sources said.
A committee, that was formed last month with the joint secretary of ministry of Textile and Jute Rezaul Quader as its head, has already started evaluating the financial and operational health of the divested mills.
The report will have to be placed to the authority concerned within a month, they said.
A total of 38 jute mills were privatised in 1983. Of them, 25 mills remain closed since long due to financial constraints. Besides, the privatisation of 15 textile mills started in 1977. Now three textile mills are operating and 12 remain closed, said millers.
“We are working to evaluate the performance of those mills. Our task is to prepare a report on the mills and after that the authority concerned will decide what will they do,” Mr Rezaul Quader told the FE declining to explain in details.
Recently, a meeting chaired by Prime Minister Sheikh Hasina at the textile and jute ministry took a decision to get back the privatised mills those violated the conditions. Mirza Azam , state minister for the ministry of textile and jute said they are working to get back the poor performing mills under government ownership.
He said four mills have already been identified to bring back to public sector.
But experts and sector insiders opined that it will be not a good decision as state-owned mills are struggling hard to survive.
Khondaker Golam Moazzem, additional director, research, Centre for Policy Dialogue (CPD) said this move will give a negative message to the private sector.
He said when the state -owned jute mills are passing through a bad time, the initiative to bring back privatised ones is not a wise decision. There is no guaranty if the mills will be running properly under the public sector or not, he feared.
He also said the demand for jute goods is gradually decreasing in the international market and India is contemplating to withdraw the mandatory use of jute bags locally.
In this situation the government should give attention to local use of jute bags, he said adding it should implement the mandatory jute packaging law immediately as in future Bangladesh’s jute goods will have to be marketed locally.
He, however, said the government is not pro-active to implement the mandatory jute packaging act.
Responding to a query Mr Moazzem said if the privatised mills fail to be profitable, government should phase out those and set up other mills.
But in this situation the whole process should be transparent so that the government could meet all types of dues of the mills, he added.
The same procedure should be applicable for the privatised textile mills also, he further said.
Bangladesh Jute Mills Association (BJMA) secretary Abdul Barik Khan said if the government gets back the privatised mills, those will not be profitable in absence of government’s good wishes to implement the mandatory jute packaging act and product diversification.
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