They also said the imposition of new import duty and VAT on viscose, polyester staple fibre and acrylic staple fibre will cast negative impact on the textile sector.

The textile millers said if the tariff structure of the proposed budget is implemented they will have to pay a total of 31.1percent tariff against 4 percent in the current fiscal year while importing raw materials.

On the other hand, the millers also will have to pay 36.9 percent duty on importing finished yarn under the proposed tariff structures, much to the frustration of local sweater and clothing factories, they added.

"Tk 30,000 crore industry will become sick if the government does not change the tariff structure proposed in the budget for 2007-08," said Abdul Hai Sarker, president of Bangladesh Textile Mills Association (BTMA), while talking to a group of reporters yesterday at BTMA office in Dhaka.

He also said the local industry will face uneven competition in the world market due to the proposed budgetary measures.

According to the BTMA, the local industry's competitors in India, Indonesia, and Vietnam receive huge incentives from their governments.

The cost of establishing a textile mill has gone up by 66 percent over the last three years due to currency depreciation and high construction cost, BTMA leaders said. Therefore, additional 10 percent duty on import of capital machinery for textile will discourage investment in the sectors, they added.

The BTMA leaders recently met the finance adviser and urged him to reconsider the proposed tariff structure.