Garments sector needs electricity tariff revision

Shirajiv SIRIMANE

I personally do not expect Government authorities to grant exporters duty free vehicle permits to import super luxury cars or jeeps but instead we expect an electricity traffic concession.

The Government should provide a permanent solution to the tariff of the Ceylon Electricity Board which is said to be the highest in the region.

"This has eaten into the margins of exporters in a disproportionate manner. This is a cost which cannot be transferred to the buyers while offering competitive prices," Chairman cum Managing Director of BOI enterprise Texstyle Lanka (Pvt) Ltd, Ananda Lakshman Bandara said.

"I personally do not expect Government authorities to grant exporters duty free vehicle permits to import super luxury cars or jeeps but instead we expect an electricity traffic concession.

"At the 16th NCE awards ceremony, Minister Dr. Sarath Amunugama said that we can expect a reduced electricity tariff in 2010. But I strongly urge a revision of this tariff by next year for all genuine exporters to survive," he said.

The company was recently the recipient of a Gold Awards at the NCE Export Awards ceremony.

In the garments sector it won the Best Woman Exporter 2007 Gold Award and also won gold in the garment sector large category.

This is also the first time that a husband and wife combination won two golds in an NCE exports awards ceremony.

The company today is the only Sri Lankan company that supplies clothing products to the UK Ministry of Defence.

The company produces sophisticated safety, military, aerospace and survival clothing with high added value. The company also operates a true knit plant supplying pullovers, sweaters and cardigans to the UK market under labels such as BHS, Chums, Woodville and Heatons.

Another first the company has achieved is that it is the first in Sri Lanka to have woven and true knit under one roof.

Q: How did you get involved in the garment industry?

I started my career at Browns Group in 1969 and left in 1978 after serving as an Engineer. In 1978 I joined Hentley Garments as the garment sector was booming with the 1977 open economy.

I worked at Hentley Garments until 1984 and then joined Cadillac Garments as additional General Manager and rose to the position of General Manager in three months and then their board.

In 1990 I joined the garment buying/liaison office of Aitken Spence Group. After a brief period I was absorbed to their Board of Directors. In 1998 I took over their garment buying/liaison office to float my own company. In 2003 I moved into my own premises at Boralesgamuwa and simultaneously went into manufacturing. The company came into existence as a garment buying and liaison office in 1998, before embarking on a manufacturing programme in 2003 with nine employees as a modern sample manufacturing unit. My wife, Hemali Bandara, with her garment industry experience working for Hentley Garments, was a tower of strength to me. My wife, who also counts over 30 years experience in all aspects of garment manufacture, now handles the entire sphere of operational activity of the manufacturing unit. I look after the finances and administration while she looks after the production.

I further expanded my manufacturing activities as I was contracted to supply fabric sea anchors used in life rafts for survival Operations. This expansion with high quality standards led to an alliance with RFD Beaufort Limited, a British Company who is the main supplier for the Military, aero space and survival clothing equipment to the British Ministry of Defence to whom we are working now. Now we are into combat wear as well.

Today we have also diversified into the plantation sector.

Q: How do you review the GSP Plus?

GSP plus concession is a must for the garment sector to survive. Without it there would be a 12 per cent tax which the manufacturers would have to add to the customer. By doing this, Sri Lanka would lose the competitiveness edge it has on its products. However Sri Lanka can still compete by attracting a niche market like us. The biggest advantage Sri Lanka has is its labour force which has the edge over countries like Bangladesh and India. Also Sri Lanka is 110 per cent free of child labour.

Q: What sort of trends do you anticipate in the apparel industry and how do you cope with them?

Economic trends globally are on a downturn and possibly going into recession. When this happens apparel purchases would be one of the first items to be lopped off on a consumer's expenditure list.

I also note that Chinese products are not going to be cheaper in the future as they are moving into the manufacture of other products such as electronics and labour is getting more expensive.

We therefore anticipate difficult times ahead and have taken precautions by entering a niche market.

Q: How would the present economical and security situation in the Country affect you?

We are in a war situation and the stock market too has declined in recent times.

But having said that, one must give credit to the Central Bank authorities for having maintained a stable exchange rate and lending rate over a reasonable period of time.

Now, terrorism is a global threat and not confined only to our country. I am not competent to comment on the security situation, but I must say a lot could be achieved if an era of peace dawns.

As an exporter I don't think these two factors will affect us very much as I said, the exchange rate must be steady and lending rates should be reasonable.

Q: What do you think of the Provincial Council system?

This is something forced upon Sri Lanka and I think it's a waste of time, energy and money.

Sri Lanka should go back to the old political system.

Q: Who is going to take over the company?

Both of us never wanted our children even to see a machine since we did not want them to go through the suffering we had when starting this venture.

My son Saminda was studying Aeronautical engineering and having realised that he has no scope in it in Sri Lanka has now switched onto the apparel sector. My daughter Kaushalya is now doing advanced studies in the apparels sector in the UK.

Q: Where would you like to spend your holiday?

I have a bungalow in Kotmale and we like to spend our time there and if it's overseas its Switzerland as I think it's the perfect place to spend a family holiday.