BB governor assures timely release of export incentives

Bangladesh Bank Governor Md Mostaqur Rahman has assured that monthly cash incentives for exporters will be released within the same month once pending issues are resolved.
He made the remarks during a meeting with a delegation of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) at his office on Wednesday.
The governor said the central bank would take prompt and effective measures on matters within its jurisdiction and emphasised that no applications for cash incentives would be kept pending in the future.
The BGMEA delegation, led by its president Mahmud Hasan Khan, urged the central bank to take urgent steps to help address multiple challenges facing the garment sector and presented several policy proposals.
During the meeting, Mahmud Hasan said the country’s garment industry is going through a difficult period due to instability in the global economy as well as various domestic constraints.
“Although many banks have rescheduled loans, they are not providing the necessary working capital, making it difficult for factories to continue operations and repay loans on time,” he said.
BGMEA leaders called for increasing and maintaining cash incentives as policy support to help safeguard the industry and encourage new entrepreneurs during the current crisis.
The delegation proposed raising the special cash incentive rate from 0.30% to 1%, increasing the alternative cash incentive, provided in place of bonded warehouse and duty drawback facilities, from 1.5% to 2%, and raising the incentive rate for small and medium enterprises (SMEs) from 3% to 4%.
They warned that delays in releasing incentive funds could force many factories to shut down, potentially affecting employment in the labour-intensive sector.
To further support the industry, the delegation also proposed reducing the interest rate on packing credit (PC) to 7%, increasing the size of the pre-shipment credit refinance scheme from Tk5,000 crore to Tk10,000 crore, and extending the tenure of the fund until 2030.
They also recommended bringing export loan interest rates down to single digits and easing loan conditions for SME enterprises.
During the meeting, the delegation raised concerns about difficulties in encashing fixed deposits and export proceeds held in several consolidated Islamic banks, including the former EXIM Bank and First Security Islami Bank.

BGMEA leaders said liquidity shortages at these banks are making it difficult for many factories to pay workers’ wages and electricity bills.
The governor assured the delegation that the central bank would closely monitor the issue and take necessary steps to resolve it.
Among others present at the meeting were BGMEA Director Majumdar Arifur Rahman, Director Dr Rashid Ahmed Hossaini and Managing Director of Mahin Apparels Limited Abdullah-Al-Mahmud Mahin. Senior officials of Bangladesh Bank were also present.
Earlier, Bangladesh Bank allowed banks to provide a specialised loan facility for active export-oriented industries to pay wages and allowances for workers and staff for February 2026.
BGMEA also welcomed the government’s decision to release Tk2,500 crore in outstanding cash incentives for export-oriented ready-made garment (RMG) and related sectors, which is expected to be disbursed before Eid.