The New Nation - Internet Edition

Staff Reporter

The government yesterday announced a stimulus package of over Tk 1,000 crore for the country's export oriented industries in an effort to make those competitive in the global market.

Finance Minister AMA Muhith at a press briefing at his office announced the package.

The stimulus came following recommendations submitted by a sub-committee headed by former finance minister M Syeduzzaman.

However, export-oriented BGMEA and the BKMEA has expressed mixed reaction on the package and said the small and medium factories would not be able to enjoy the package unless the government reconsiders the conditions mentioned in the announcement.

The latest package is an addition to the stimulus package, announced earlier for the export industries excluding garment sector, said a release of the Finance Ministry.

The government earlier in April this year announced a stimulus package of Tk 3,424 crore amidst growing concern over the negative impact of global economic recession.

The package also includes waiver of renewal fee of captive generator up to June 30, 2010, extension of reschedule of loan without down payment up to end of next June and bring down interest rate to 10 per cent, 5 per cent cash incentives on export earnings from markets other than USA, UK, European Union and Canada, 5 per cent cash incentives on additional export in next year export over last year, raising of export development fund loan facility up to US$10 million from the existing US$1.5 million and 5 per cent cash incentives for ship building industry and crust leather.

According to the announcement no small and medium factories will enjoy the benefit of 5 per cent incentives if those are having captive generator, enjoyed the down payment free reschedule facility and are sister concern of big group of companies.

Expressing his reaction over the package president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Abdus Salam Murshedy said the government did not follow any recommendations made by the sub committee.

"The small and medium factories in no way would be able to avail the package as the package imposed numbers of conditions. The package will remain as package only, none will enjoy the benefit," Murshedy said.

"We had demanded to suspend generator renewal fee until the government can supply us uninterrupted as and power. But the government waived the fee for only one year. We urge the government to provide 5 per cent cash incentives to all small and medium factories," the BGMEA president added.

He said stakeholders were expecting short term and long term benefits from the package but there is no reflection on the announced package.

BKMEA president Fazlul Huq said, "The package is meaningless for small and medium factories. It seems to be playing with future of those."

"The small and medium factories are main victim of global economic recession, but they are not getting anything."

Actually the big factories will enjoy the 5 per cent incentives on export to new markets as small and mediums have no capacity to explore those, he said.

Huq welcomed decisions if raising EDF fund to US$10 million and unified service charge for banks.

He, however said, no package will bring any benefit unless the government can supply uninterrupted gas and electricity to the factories.