Accept deferred payments to benefit both nations: FBCCI to India
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), the country's apex trade body, on Monday demanded that India accept deferred payments of up to 240 days for more value addition and jobs in the bilateral supply chain.
India is currently the second largest import source for Bangladesh after China. Indian businesses supply a majority of the industrial raw materials required by Bangladesh with an annual export value of about $8 billion through formal channels.
Western retailers and brands are deferring payments to local manufacturers and exporters due to the Covid-19 crisis and so, allowing the same for the latter while maintaining healthy supply chains can stimulate businesses, protect existing jobs and create new ones for both nations.
Job creation and investments through Bangladesh-India joint ventures are is best way to benefit both nations and to stimulate the economy amidst the coronavirus fallout, said FBCCI President Sheikh Fazle Fahim.
Fahim made these comments while addressing a webinar themed, 'India-Bangladesh Trade and Investment: Stakeholders Interaction', jointly organised by the Federation of Indian Chambers of Commerce and Industries (FICCI) and the Indian high commission in Bangladesh.
Currently, bilateral trade with India stands at about $9 billion.
"And due to the Covid-19 realities…joint investments that are a part of the value chain for products and services, of which raw materials are from India, finished goods are in Bangladesh, used in production in Bangladesh and re-exported to India and beyond, is a strategy that I think both nations would benefit from," Fahim said.
Exploring opportunities in light engineering, a value chain initiative with raw materials from India and production in Bangladesh, will be another complimentary initiative in a long list of bilateral cooperation, he added.
Revising the provision on deferred payments will assist in increasing exports of backward linkage products from India to Bangladesh and exports to India and beyond through bilateral value chain initiatives, targeted towards global markets, said the FBCCI President.
Fahim also requested Indian stakeholders to consider extending deferred letter of credit payment facilities from Indian banks for 240 days.
The extended deferred payments should increase procurement volumes for enterprises presently engaged in diverse countries other than India, the FBCCI president also said. High import duties, particularly on passenger and commercial vehicles, come in the way of accelerating bilateral trade, mentioned Manoj Chugh, president (group public affairs) of Mahindra & Mahindra, as per an FBCCI statement yesterday.
"Suitable retail finance needs to be enabled for such products in the Bangladesh market," Chug said.
On his point on diversification of routes to ease the movement of goods to promote investment and trade, Fahim said they needed to think a little outside of the box as the conventions have been such in terms of cost effectiveness.
"Waterways is the best option. Then there is the railway," he said.
"There are definitely pushes towards exploring and as fast as possible executing these routes in terms of passenger vehicles or any kind of goods and services that comes to Bangladesh from India or the products that goes to India," the statement read.
Riva Ganguly Das, Indian high commissioner to Bangladesh, echoed the same as keynote speaker.
"Indian railway and Bangladesh railway are working together which shows how committed they are to provide smooth logistics," she said.
India is dedicated to take regional cooperation forward, she said while praising several other speakers' ideas on remote deduction of duty on passengers and commercial vehicles.
Dilip Chenoy, secretary general of the FICCI, and Manish Singhal, FICCI deputy secretary general, presided over the programme.
Abdul Matlub Ahmad, president of the India-Bangladesh Chamber of Commerce and Industry, Venkat Nageswar, deputy managing director of the State Bank of India, and Ashok Anantharaman, director (international) of CNH International, also participated in the webinar.