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Rubber garden owners and farmers are in big dilemma whether this sector falls into the category of agriculture or industry.
As there is no clarification on the sector it is not getting proper attention and help from the government, banks and financial agencies.
Rubber is produced on about 140 thousand acres of land in the country and the number of gardens is about 1500. In these gardens, about 67 thousand metric tonnes of latex (liquid rubber) are produced a year.
According to the Rubber Garden Association, various taxes of at least 25 percent, of which 15 percent is VAT as an industrial product, are to be paid on rubber produced in the plantations.
But the rate of VAT on imported rubber is only five percent as it is considered as industrial raw material.
As the amount of VAT on rubber produced in the country is relatively high, this sector is suffering from big discrimination, General Secretary of Bangladesh Rubber Garden Owners Association (BROGA) Mohammad Saif Ullah Mansur said. If the government does not look into the matter immediately, this sector will be destroyed.
There is no clear explanation from the government agencies whether it is the industrial sector or the agricultural sector and so it is very difficult to get financial support from banks and other agencies, he said.
He claimed that although it is an agricultural product there is government tax on it like industrial products.
Rubber is a highly valuable cash forest resource with a wide variety of uses produced from the latex of rubber trees.
In 1952, the then forest department imported rubber seeds and thousands of rubber seedlings from Malaysia and Sri Lanka and experimentally planted some trees in the Chittagong hilly region and Madhupur area of Tangail. In 1959, the Food and Agriculture Organization of the United Nations (FAO) examined the potential of rubber cultivation in Bangladesh and recommended that the country’s climate and soil be highly suitable for rubber cultivation and hence commercial cultivation of rubber started.
In 1961, rubber cultivation started commercially in the hilly areas of Chittagong and Sylhet under the government sponsorship.
The potential of this sector has not been fully exploited mainly due to the negligence and lack of interest of the rubber plantation owners, said Chairman of Bangladesh Rubber Board Syeda Sarwar Jahan. Now the government has taken extensive initiatives to promote the sector, she said.
There is a need for a clear explanation on whether the rubber garden is an industrial or an agricultural sector, especially in terms of taxation, she said.
The Ministry of Forests, Environment and Climate Changes and the National Board of Revenue have been informed to take urgent action in this regard.
Latex and industrial producers are in one place
Natural rubber and rubber-based industrial products fair started for the first time in Gymnasium field of MA Aziz Stadium in Chattogram to encourage cultivation and quality production of rubber.
The fair which started last Wednesday will continue till next Tuesday.
A total of 27 public and private institutions are participating in this fair that will display rubber tree latex, solid rubber and various types of industrial products made of rubber.
In addition to exhibitions, seminars and symposiums are being organized in this fair by the Bangladesh Rubber Board. Different types and qualities of rubber can be produced from rubber latex obtained from the garden.
Rubber is used to make vehicle tires-tubes, shoes, sandals and small parts of various machines, said Abu Tayeb, the owner of Shema Enterprises, participating in the fair.
But due to free flow of rubber products import, the domestic industry could not flourish, he said, adding that the government should take a decision in this regard. The demand for processed rubber in the country is about 35,000 tonnes. A total of 25,000 tonnes of rubber is obtained from the latex obtained from plantations in the country.
About ten thousand tonnes are imported but some rubber products are exported abroad, said President Mohammad Kamal Uddin. About 30,000 workers are employed in the country’s rubber plantations and about one lakh manpower is engaged in rubber processing and rubber-based industries.
In 2017, Bangladesh joined the Association of Natural Rubber Producing Countries, an organization of rubber-producing countries in the world.
