Tannery owners preparing to collect 8 million hides during Eid, dissatisfaction over loan support

PNN News Desk. Dhaka

Ahead of Eid-ul-Azha, tannery owners in the country are preparing to collect 7.5 to 8 million sacrificial animal hides. A large portion of these will be purchased directly from Dhaka. However, business owners have expressed concern over receiving less bank loan support than required.

According to sources related to the leather sector, tannery owners plan to collect about 80 percent of Dhaka’s sacrificial hides directly. Last year as well, they purchased around 7 to 8 lakh hides directly from the capital.

State-owned banks have distributed a total of 16 billion taka in loans for hide purchasing. Several private banks have also provided limited financial support. However, many businessmen were unable to obtain new loans due to previous loan defaults.

Bangladesh Tanners Association Chairman Md. Shahin Ahmed said that due to high inflation and ongoing instability in the Middle East, the number of sacrificial animals may slightly decrease this year. Therefore, collection targets have been set accordingly.

He also said that if hide quality is good, the government-fixed price will be paid. However, due to rising costs of salt, labor, and transportation, raw hide prices may decline slightly.

Bank sources said that a large portion of leather sector loans is provided as working capital. Additional financing is also provided during Eid season for hide procurement.

Sonali Bank provided loans to only one institution for hide purchasing. Managing Director Shaukat Ali Khan said only one tannery was eligible among the applicants.

Agrani Bank provided 7.5 billion taka to two institutions. Apex Tannery received 4.5 billion taka and Bay Tannery received 3 billion taka.

Janata Bank approved 6 billion taka in loans, but part of it has not yet been disbursed. Rupali Bank did not provide new financing to several applicants due to exceeding previous loan limits.

Tannery owners complain that even after relocation of the leather industrial city to Hemayetpur in Savar, environmental pollution and export problems have not been fully resolved. As a result, many businesses have become loan defaulters, making it difficult to obtain new loans.

Businessmen believe that with adequate banking support and proper market management, the leather sector may have a chance to recover this Eid.