Karnaphuli Rayon and Chemicals (KRC) Limited has been incurring huge losses ev ery year because of declining demand for its products In both local and International markets.

The losses and accumu lated loans of the factory located at Chandraghona of Rangamatl district, reached such extent that it would be difficult to continue Its operation unless immediate mea-sures are taken by the government to overcome the crisis.

The loss in the current fis-

cal year reached Tk 20.65 crore till April. It was Tk 18.85 crore in 1991-92, Tk 6 71 crore in 1990-91. Tk 7.72 crore in 1989-90 and Tk 13.63 crore in 1988-89 fiscal

At present, the KRC is producing rayon yam, cellophane. RSF (rayon stable fibre) and six chemical items.

Officials at the factory told The Dally Star that the rayon market had shrlnked as the people are becoming more interested about cotton clothes rather than synthetic ones.

Moreover, polyester yarn. Inter mingle yarn and various other types of synthetic yarns are now dominating the market. leading the KRC. established In 1964, towards closure, they said.

The cellophane items cannot compete with Imported products mainly because of higher cost of production, they added.

While briefing a group of newsmen Wednesday at the factory Managing Director of KRC, K M R Islam Abu Wahed said the RSF plant, which was established in 1984, had to be closed in 1989 as the textile units under Bangladesh Textile Mills Corporation (BTMC) stopped using RSF

The outstanding loan of the factory stood at Taka 280.45 crore and the factory had to spent Tk 10 to 12 crore each year for paying interest against the loan, the Managing Director said.

The withdrawal of rebate facilities for importing raw materials In last year’s budget also contributed to the crisis, Abu Wahed said.

He also said that Imposition of VAT on RSF made the crisis more acute

He. however, disclosed that KRC had recently signed an. agreement to export 168 metric tonnes of rayon to Pakistan.