Dhaka, May 15 (IANS): Bangladesh authorities announced that 319 garment factories, unable to cope with global competition, are going to shut down.

“It is a matter of concern that 618 factories shut down in past three years after their productivities dropped due to various reasons. Now 319 more factories are also going to close down,” Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Siddiqur Rahman said on Saturday.

The garment sector is facing the challenge of gas and power crisis, high interest rate of bank loans, devaluation of the US dollar, and cut in price of its products, Rahman said.

He demanded halving the tax at source for the sector to 0.3 percent in 2016-17 like the previous fiscal year.

He also suggested that no value added tax should be imposed on garment accessories, and duty-free import of fire extinguishers should be allowed to help the entrepreneurs tackle the challenges.

Rahman said the export from the sector has been growing by an average of 10 percent over past five years.

“We need 12 percent annual growth in order to reach the export target of $50 billion by 2021. But the growth was only 6.81 percent over past 22 months,” he said.

“So we are 3.19 percentage points behind from the expected average growth and 5.19 percentage points behind from the expected growth for the 2021 target,” he added.