BFIDC and the private garden owners grow rubber on around 92,985 acres, producing about 12,000 tonnes

of the raw material a year, according to BFIDC. (daily star)

Rubber growers, exporters fail to reap benefit from rising global demand (http://www.thefinancialexpress-bd.com/more.php?news_id=97013&date=2012-02-04) Rubber growers and exporters fail to reap benefit from the growing global demand of the product which they attributed to lack of government policy support. The sector would be able to earn foreign currency worth Tk 6.0 billion by 2025 if the sector gets government's support, they added. The sector has been witnessing negative growth of export during the first half of the current fiscal which the industry people blamed the imposition of 15 per cent VAT on the product. International demand for the natural product is growing significantly as there is shortage of the item because the producing countries are switching over to palm oil cultivation. But Bangladesh is yet to have its share of the global demand as the government does not pay attention to this sector, they claimed. "Rubber is considered as a natural and organic product, the demand for which is significantly growing both in local and international markets with increasing use of rubber in tyre and tube, electric insulator, printing and garment industries," President of Bangladesh Rubber Garden Owners Association (BRGOA) Mirza Anwar Hussain told the FE. But we are yet to grab the potential market because of lack of government policy support, he added. There is none to look after the sector and even there is no expertise in both public and private sectors, he said adding imposition of VAT on raw rubber is 'unfair', as the government has withdrawn VAT from all agro-based products, such as rice, jute, potato and tomato to boost growth of these sectors. Following the growing demand and high prices, growers are encouraged in cultivating rubber for last two years, he added saying imposition of VAT is a hindrance to the sustainable production and growth of the sector. "We are not opposing the imposition of VAT but we need at least five years for the sustainable production and growth of the sector," he said demanding the VAT waiver till 2017. Explaining the continuous negative growth of rubber export that started from the first month of 2011-12 fiscal, he said the main reason is the imposition of VAT for which exporters fail to continue their

competitiveness. The country fetched $5.47 million during July-December of 2011-12 fiscal from the sector which is 28.40 per cent lower than the same period of the corresponding year. It also fell short by 54.72 per cent of the target set for the period. "One of the reasons for the decline is falling price of the product in recent times," another rubber grower said adding the price for a kilogram (kg) of rubber reached Tk 350 last year which is now traded between TK 270 and Tk 280, he added. If we get proper government support, we will be able in producing 25,000 tonnes of rubber only from the private sector by 2025, the BRGOA president said. "That time we can earn Tk 6.0 billion from the sector," he hoped. "It is the Rubber Board that is yet to be formed, which could only decide the right time to impose tax and VAT on the raw rubber. In the absence of a Rubber Board, there is none to oversee rubber plantation, processing, marketing and export," former president of BRGOA Syed Moazzam Hossain said. Rubber growers demand recognition of the sector as an 'agriculture-based one' and the government's support to utilise its vast potential by providing loans, withdrawing of VAT and other policy supports. They also demanded restart of transferring system of garden who are unable to grow rubber or gardening. Cultivation of rubber is relatively new in Bangladesh, compared to other countries. Both the private and public sector produce about 16000 tonnes of rubber annually.

BANGLADESH: Rubber sector seeks soft bank loans, VAT waiver - Government support can triple production Source: Daily "New Age", Dhaka; 4 June 2011

The countrys rubber industry has bright prospect to become a major area in the economy in three years if the sector is given policy support like soft bank loans and VAT waiver. We will be able to enhance rubber production from $90 million to $270 million annually if the sector gets necessary government support like soft bank loan and waiver of 15 per cent VAT on raw rubber, said Bangladesh Rubber Garden Owners Association (BRGOA) president Syed Moazzam Hossain.

Hossain said the sector was now suffering from diverse problems as there was no bank loan available for the last 13 years and 15 per cent VAT was operative on raw rubber. We need governments policy support to give the sector a fillip, he said. The BRGOA president said demand for rubber is on the sharp rise and per kg rubber now sells at between Tk 350 and 400. The price of the item fluctuated between Tk 70 and Tk 100 last year. Likewise, he said, production cost of rubber has gone up by 50 per cent. So, the sector deserves VAT waiver and bank loans with five per cent interest as rubber is an agriculture product. The BRGOA president said natural rubber has huge demand both at home and abroad. For instance, he said, Turkey, Pakistan, and China have shown keen interest in importing rubber from Bangladesh but we have no surplus quantity to export. In the absence of Rubber Board there is none to oversee rubber plantation, processing, marketing and export. Formation of Rubber Board is a must for nurturing the sector, he said. Due to old clone and primitive plantation system it takes eight years for latex extraction in Bangladesh whereas in Malaysia the clone yield latex in four years. The BRGOA chief has forwarded a set of proposals to the government for the growth of the potential sector. The proposals include, among others, exemption of bank interest, making a rubber policy, setting up a rubber board and rubber research institute, sourcing high yield clone to increase productivity, open up scope for joint venture investment under public-private partnership. We can earn foreign currency from carbon trading since rubber tree extracts carbon dioxide three times more than any other tree. We can take the advantage of multi billion dollars global carbon trading and environmental fund, he said. Around 15,000 tonnes of rubber is produced in the gardens on more than 85,000 acres of land in which 31,400 acres came under rubber plantation in the private sector and the rest under Bangladesh Forest Industries Development Corporation. In Bangladesh locally grown rubber is widely used in the production of sandal, bicycle tyre, automobile part, balloon, shoe sole, etc. The Bangladesh government first disbursed Tk 170 million among 360 garden owners for growing rubber gardens, each on 25 acres of land, in Chittagong Hill Tracts in 1984-85.

Private Party wants more participation (http://www.thefinancialexpressbd.com/more.php?news_id=131894&date=2012-06-05) Formation of a Rubber Board is underway by the government with the objective of raising rubber production to meet growing local demand, enhance export, bring transparency, research and development in cultivation and help the public and private planters.

Once the board is formed, the existing scattered cultivating process may get a spur and be aligned according to the law. It has already got the cabinet approval and is now under process of gazette notification, officials said. Once Bangladesh had to depend on import for a small amount of rubber. Currently demand for 14 thousand metric tons Ribbed Smoke Sheets for various industrial use is met locally. Besides, more than 6 thousand tons is directly exported every year. Demand is increasing every day for variety of end- products. Rubber as raw material is used in footwear, tube, hose pipe, rubber sole, bucket, gasket, oil seal, textile and jute mill spare parts, tire retreating, sandals, rubber mate, rickshaw and bi-cycle tire and in different rubber based diversified industrial products. Rubber is being used in more than 0.01 million industrial products and as Bangladesh is one of the world's ten rubber producing countries its export market is also huge, said Bangladesh Forest Industries Development Corporation (BFIDC) Chairman and Additional Secretary of the Bangladesh Government Prasanta Bhushan Barua. Mr Barua said, currently BFIDC is producing 6000 metric tons of rubber every year on 32,635 acres in 16 gardens mainly in Cox-s-Bazaar, Chittagong, Tangail and Sylhet districts. In last three years, BFIDC produced 17,500 metric tons of rubber earning about TK1.43 billion. Barua said rubber cultivation is a highly potential sector and the BFIDC is trying its best to enhance cultivation. A latest garden is under process in Rangunia of Chittagong where 1000 acres of forest department's unutilized land would be brought under rubber cultivation. The government still holds huge area of barren lands which could be utilized to cultivate rubber latex. Private and BFIDC now produce rubber worth TK3 billion. More than 13 hundred private planters are producing more than 8 thousand tons of rubber on 32,500 acres taken on lease from the forest department, said Bangladesh Rubber Garden Owners Association (BRGOA) President Mirza Anwar Hossain. He said by the year 2025, "we hope to export 24 thousand tons of rubber from Bangladesh in the international market. Still we do have thousands of acres unutilized lands." There is a rubber policy by the government to invite more private party for cultivation but the government is yet to follow it, the BRGOA president said and added no research is taking place in this sector. Currently many countries of the world are adopting hybrid technology to increase production. There are huge opportunities for rubber gardening in Modhupur and in Mithapukur of Rangpur district. The government's unutilized lands could be utilized for gardening and private party may invest money, Hossain said.

The main aim of forming the board is to bring the stakeholders and the planters under one umbrella, make uniformity in price, create transparency, to go for R&D, support the stake holders and develop the rubber industry, said the BFIDC General Manager Md Ilias The main customers of locally produced rubber are Apex, Bata, Gazi Tire and Tube, Rupsha Rubber Industry, Bangladesh Rubber Industry, Beg Rubber Industry and dozens of other shoe manufacturers. A huge number of tire and tube are made of locally cultivated rubber, Ilias said.

'Policy support can raise rubber industry turnover to $270m in 3-yrs'

(http://www.newstoday.com.bd/index.php?option=details&news_id=29245&date=2011-06-04) Countrys rubber industry has bright prospect to become a major area in the economy in three years if the sector is given policy support like soft bank loans and VAT waiver, reports BSS. We will be able to enhance rubber production from US$90m to US$270m annually if the sector gets necessary government support like soft bank loan and waiver of 15 percent VAT on raw rubber, said Syed Moazzam Hossain, President of Bangladesh Rubber Garden Owners Association (BRGOA). In an exclusive interview with BSS, Hossain said the sector is now suffering from diverse problems as there is no bank loan available for the last 13 years and 15 per cent VAT is operative on raw rubber. We need governments policy support to give the sector a fillip, he said. The president of BRGOA said demand for rubber is on the sharp rise and per kg rubber now sells in between Taka 350 and 400. The price of the item fluctuated between Tk.70 and Tk.100 last year. Likewise, he said, production cost of rubber has gone up by 50 percent. So, the sector deserves VAT waiver and bank loans with five percent interest as rubber is an agriculture product. The BRGOA president said natural rubber has huge demand both at home and abroad. For instance, he said, India, Turkey, Pakistan, China have shown keen interest in importing rubber from Bangladesh but we have no surplus quantity to export. In the absence of Rubber Board there is none to oversee rubber plantation, processing, marketing and export. Formation of Rubber Board is a must for nurturing the sector, he said. Due to old clone and primitive plantation system it takes eight years for latex extraction in Bangladesh whereas in Malaysia the clone yield latex in four years. The BRGOA chief has forwarded a set of proposals to the government for the growth of the potential sector. The proposals include, among others, exemption of bank interest, making a rubber policy, setting

up a rubber board and rubber research institute, sourcing High Yield Clone to increase productivity, open up scope for joint venture investment under Public Private Partnership (PPP). We can earn foreign currency from carbon trading since rubber tree extracts carbon dioxide three times more than any other tree. We can take the advantage of multi billion dollars global carbon trading and environmental fund, he said.

Bangladesh fails to cash in on rising global demand for rubber

(http://rubbermarketnews.net/2011/06/bangladesh-fails-to-cash-in-on-rising-global-demand-forrubber/)

Local producers and exporters are yet to reap financial benefits of the growing demand for rubber in the global market due mainly to, what the sector insiders said, lack ofgovernments policy support. They said international prices for rubber and rubber products are increasing as there is a shortage of the item because its main producing countries are switching over to palm oil cultivation. But Bangladesh is yet to have its share of the global demand as thegovernment does not pay attention to this sector, they claimed. We have no Rubber Board and even a policy that can guide the sector people, Syed Moazzam Hossain, president of Bangladesh Rubber Garden Owners Association (BRGOA) told the FE Monday. The rubber growers also do not get loans while a farmer needs minimum six to eight years to collect rubber latex from a tree which requires a lot of investment, he said. Moreover, while a farmer gets fertiliser at subsidised rate for rice and other agro-products cultivation, rubber growers pay double compared to them for fertiliser, he added. The industry needs policy support like soft bank loans, VAT waiver, institutional supports, including research and training, for the growth of the sector, he noted. Explaining the potential of the product, he said businessmen from many countries, especially India, China, Malaysia, Turkey, Singapore and Pakistan, are showing keen interest in Bangladeshi raw and processed rubber for its quality.

The global shortage and price hike of rubber have forced international traders to treat Bangladesh as an alternative source, he said adding the price for a kilogram (kg) of rubber has gone up to Tk 350, which was only Tk 70-Tk 100 per kg two years ago. According to Export Promotion Bureau, the country fetched $19.78 million during July-May of the current fiscal year showing a robust growth of 123 per cent compared to the corresponding period in 2009-10 fiscal. Rubber is considered a natural and organic product, the demand for which is significantly growing both in local and international markets as use of rubber in tyre and tube, electric insulator, printing and garment industries is increasing, the BGROA chief said. He said, It is the Rubber Board, that is yet to be formed, only which could decide the right time to impose tax and VAT on the raw rubber. In the absence of a Rubber Board, there is none to oversee rubber plantation, processing, marketing and export. The government should form a Rubber Board and rubber policy for nurturing the nascent sector, he said adding imposing VAT on raw rubber is unfair, as the government has withdrawn VAT from all agro-based products, such as rice, jute, potato and tomato, to boost growth of these sectors. Rubber growers demand for their recognition as an agriculture-based sector and the governments support to utilise its vast potential by providing loans, withdrawing of VAT and other policy supports. Cultivation of rubber is relatively new in Bangladesh, compared to other countries. The government has been encouraging plantations in the hill areas since 1980. About 45,000 acres of land have been allotted to the Bangladesh Forest Industries Development Corporation (BFIDC) so far, and 32,500 acres to private owners, for rubber plantations.