Bangladesh to disburse Tk 4.43 billion in rawhide trade loans this Eid
However, as in previous years, the target may not be met as rawhide traders complain about the reluctance of banks to lend them.
Every year, rawhide traders and tannery owners receive loans during Eid-ul-Azha. Rawhide and hides from sacrificial animals during Eid account for nearly half of the raw material supply used in the leather industry throughout the year.
Bangladesh will celebrate Eid on July 10 this year.
Central bank spokesman Md Serajul Islam said: “Four public and seven private banks will disburse the loans. We sent letters to the banks with the instruction.
Leather traders, including small business owners, tanneries and organizations involved in processing, can reschedule overdue loans after a minimum 2% down payment and obtain new loans to purchase rawhide.
According to the Ministry of Fisheries and Livestock, there are 12.12 million animals ready for slaughter in the country, including 4.43 million cows, 173,504 buffaloes, 6.57 million goats, 937 682 lambs and 1,409 other animals.
The demand for sacrificial animals this year is 9.77 million.
However, the demand for Eid livestock in Dhaka stands at over 2.47 million against a supply of nearly 869,000. There is excess livestock in all five divisions except Dhaka.
Among the public banks, Janata Bank will disburse the highest loan amount in the rawhide trade – Tk 1.2 billion, while Agrani Bank will distribute Tk 830 million, Rupali Bank Tk 300 million and Sonali Bank 250 million Tk.
Among private banks, Islami Bank allocated 1.7 billion taka for loans. In addition, Al-Arafah Islami Bank will disburse Tk 52 million, Jamuna Bank Tk 50 million, Dhaka Bank Tk 30 million, South Bangla Agriculture and Commerce Bank Tk 10 million, National Credit and Commerce Bank Tk 5 million and The City Bank TK. 3 million at merchants.
Last year, the central bank approved loans of 5.83 billion taka, but less than half of that amount has been disbursed. This has been the case in recent years.
DO NOT WANT TO LEND
Tipu Sultan, general secretary of the Bangladesh Hides and Skins Merchants Association, complained about banks’ reluctance to provide loans.
“Banks only give loans to tannery owners and exporters and leave out other traders involved in rawhide. So they have to manage knowledge funds for business in this sector,” he said.
“Traders in the rawhide sector are supposed to get loans, but no bank is complying. [The traders] don’t even know.
Aftab Khan, managing director of leather trade organization Mahbub and Brothers, confirmed he had no idea about the loans.
“Only the tanneries and exporters get the credit. Firms from Hemayetpur to Savar and three factories outside Dhaka are getting it. Banks don’t lend to anyone else.
However, a Bangladesh Bank notice dated 30 June stated that leather traders including “tanneries and all commercial organizations/industries involved in the trading and processing of rawhide” can reschedule their delinquent loans on a minimum down payment of 2% to qualify for new loans for the upcoming Eid-ul-Azha.
Several years ago, each rawhide sold for around 2,500 Tk, but prices have dropped in the last couple of years. In 2020, a huge amount of rawhide had to be buried for lack of buyers.
Prices were higher last year, but they were still lower than regular prices, and warehouse owners blamed tannery owners for not paying them their dues.
The relocation of the Hazaribagh tanneries to Savar caused a huge downfall in the country’s leather trade.
PRICE, CONSERVATION THIS YEAR
The government raised rawhide prices by Tk7 per square foot for supply during Eid-ul-Azha on Tuesday.
This year, the government will set the price of raw salted cowhide at Tk 47-52 per square foot in Dhaka and Tk 40-44 outside Dhaka.
The price of raw salted goatskin has been set at a maximum of Tk 20, Munshi said.
Last year, the price of raw salted cow leather was Tk 40-44 in Dhaka and Tk 37 outside Dhaka, while the maximum price of raw salted goat leather was Tk 17.
Tapan Kanti Ghosh, Principal Secretary of the Ministry of Commerce, called on donors and buyers to ensure that salt is applied to the raw hides of animals sacrificed during Eid for conservation purposes.
“We want to encourage people to apply the salt and save the skins themselves. Those who sacrifice animals should be aware of this. They should buy salt and either apply it themselves or give it to those who sacrifice them. take the skins, be it an orphanage or any other religious institution or seasonal trader.”
“We hope to be able to procure salted skins this year. This will help maintain the quality of the leather we produce and increase our export earnings.