Bangladesh Bank (BB) has been requested to quickly release the Export Development Fund (EDF) to facilitate business make proper use of the low cost credit.
Principal Secretary of Prime Minister’s Office (PMO) Md. Abul Kalam Azad made the request at a meeting of Private Sector Development Policy Coordination Committee (PSDPCC) at the PMO yesterday, said a press release today.
The central bank has increased the limit of the fund for apparel exporters to $20 million from existing $15 million.
Chairman of Business Initiative Leading Development (BUILD) Syed Nasim Manzur pointed out the difficulties in getting the fund released timely.
“It takes roughly 30 days to avail this fund,” he told the meeting, seeking attention of the Principal Secretary to reduce the time. He also stressed the need for making this fund open to other sectors.
In response, the Bangladesh Bank representative to the meeting said it usually takes seven days.
“We will look into the issue and reduce the time for availing this fund,” he said, however.
“We expect seven hours in place of seven days for this fund,” Principal Secretary, requesting the BB representative to resolve the case.
A senior officer of a local commercial bank said Bangladesh Bank usually took 8-10 days to release the fund 3-4 months ago. During last 3-4 months period, it takes in some cases even more than 30 days.
As a result, he said, the banks also counting losses as they get only around 3% (LIBOR plus 2.5%) of interest for the period as compared to the banks’ funding cost not less than 8%.
The businesses applying for the EDF, however, face no loss or gain if the release delayed, said the officer who deals with export activities.
The PMO held the meeting for the first time with all the working committee co-chairs of BUILD, who are both from public and private sectors, to review the status of reforms undertaken so far.
BUILD CEO Ferdaus Ara Begum in a presentation said BUILD has already tabled 422 reform proposals through all working committees and finally placed through the PSDPCC at the PMO, and 101 reforms are already in effect and the rest are being reviewed by the bodies of the government with the intention of instituting implementation.
The Principle Secretary requested respective government departments to start action for implementing the reforms proposals already on table and instructed the representatives to join another review meeting within three weeks to update the implementation status, and report to the Policy Coordination Unit of PMO by the sixth week.
After the review meeting, the 9th PSDPCC meeting will take place in October next.
NBR Chairman Md. Nojibur Rahman, who co-chairs the Taxation Working Committee of BUILD, said they would soon review the BUILD proposals and give an update at the next review meeting.