In the wake of the disastrous fire at the import cargo village of Hazrat Shahjalal International Airport (HSIA), the nation’s readymade garment (RMG) industry has called on the government to step in and guarantee the timely settlement and payment of insurance claims.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) claimed in a recent letter to the Ministry of Finance’s Financial Institutions Division (FID) that the 18th October fire destroyed a sizeable amount of imported raw materials used by clothing factories.
According to the industry organisation, the impacted manufacturers have experienced significant financial losses and their current export orders—which are worth several times more than the burned imported goods—are now in jeopardy.
The BGMEA asked the FID to give insurance companies immediate instructions to settle submitted claims as quickly as possible and to deliver the money required for factories to finish their outstanding export shipments.
It stated that firms now have to re-import materials to complete orders owing to the damage of imported items, while international buyers are refusing to accept shipments until those orders are completed.
The BGMEA said, “Timely disbursement of insurance claims is crucial to help affected RMG units recover from the crisis and pay wages and allowances to workers on time.”
A senior official of the Financial Institutions Division said, “We have received an application from the BGMEA and are working on the issue. We have already instructed the concerned regulator, IDRA, to take necessary action.”
According to industry experts, impacted manufacturers must import raw materials again immediately in order to fulfill delivery dates. The businesses are severely lacking in working capital as a result of international buyers delaying payments until shipments are finished.
Even without the complexity of the “Air Risk Only” language in many plans, insurance officials have stated that determining losses, confirming coverage and processing claims might take at least one to one-and-a-half months.
The country’s textile and apparel industry has suffered immediate losses of more than US $ 8 million as a result of the fire at HSIA’s import cargo village. The administration has asked for help from foreign specialists and initiated a thorough inquiry into the situation.
