Banks are not extending their cooperation towards disbursing funds among potential borrowers as per the government-announced bailout packages, putting entrepreneurs in trouble, businesses said yesterday.
Cottage, micro, small and medium enterprises across the country are especially missing out because of the non-cooperation of banks although the government has already asked for the disbursements as soon as possible, they said.
The businesses believe that proper and transparent flow of the government-announced Tk 1 lakh crore-fund is crucial for dealing with the fallout of the pandemic in the economy.
Eventually, proper use of the stimulus packages, adoption of job creation schemes by private and public sectors and attraction of foreign direct investment (FDI) can be game-changers for the economy even amid the coronavirus, said a host of businesspeople, ministers, adviser, economists and diplomats.
The comments came at a virtual meeting on stimulus, economic sustainability, recovery, domestic investment and FDI at home and overseas, moderated by Sheikh Fazle Fahim, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI).
"We have noticed that banks are not interested to lend money to the micro, cottage and small industry owners from the stimulus packages of the government," said Munir Hossain, a director of the FBCCI.
The FBCCI has already set up 18 different regional and district councils that are acting as helping desks for potential borrowers, he said.
However, the bank branches are yet to launch such help desks to facilitate borrowers, especially cottage, micro and small industry owners, although they are considered to be the backbone of industries and the economy, he said.
He demanded that the upcoming national budget offer reduction of advance income tax to 3 per cent from 5 per cent, withdraw advance income tax on industrial raw materials and value-added tax on economic zones and reduce customs duty and source tax.
"Time has come to support domestic investment, which is required during this time," said Abdul Matlub Ahmad, former FBCCI president, while suggesting remodelling some businesses.
For instance, shrimp exporters are facing challenges as the demand for this item has declined abroad. So, the shrimp exporters now can deliver their produce to the domestic market, as has happened for ice cream. One exporter has been trying to do so in the country, Ahmad said.
In response to Ahmad's comment, Agricultural Minister Abdur Razzaque said the shrimp exporter in question had been toiling for the past one year to start this business. He has managed to obtain permission for constructing a nine-storey building in Jashore.
He said despite being a minister, it similarly took him nine months to include pineapples in the list for the government incentive package, citing it was an exportable item. "So, we need to improve the ease of doing business for both domestic and FDI," Razzaque said.
AK Azad, another former FBCCI president, suggested the apex trade body launch a study to find how much money was annually exiting the country as salaries and allowances of foreign workers.
He also urged the government for expediting functions of both of the Dhaka airport and Chattogram port in the interest of smooth operations of businesses.
"Inject more cash into the economy so that it helps with liquidity and domestic consumption, improve the access to finance, cheap, affordable, with limited collateral to promote entrepreneurship, and jobs, launch a massive employment generation scheme for returnee migrants and unemployed, focus on skills development and education, provide more support for health and agriculture sectors and food security as a share of GDP," said Manmohan Parkash, country director of Asian Development Bank.
Mia Seppo, the UN resident coordinator in Bangladesh, suggested reducing the gender gap in employment, the private and public entities increase investment for creating more jobs and protecting the interests of foreign investors alongside labour rights.
Salman F Rahman, the adviser of the prime minister on private industry and investment, said the One-Stop Service (OSS) in Bangladesh Investment Development Authority (BIDA) would be launched soon for easing business procedures.
Some medical apparel items like personal protective equipment and masks have become new exportable items from Bangladesh as many countries are importing those items from local factories. He said the government was in talks to attract FDI from China, Japan and the US.
Commerce Minister Tipu Munshi said the country's garment export might perform even better as coronavirus had eventually created opportunities for the country's garment sector.