Policy support needed to diversify exports: analysts
The government should extend its policy support beyond the garment sector in order to diversify exports, said experts yesterday.
“We will have to give importance to various promising sectors which are apparently not visible like the garment sector to diversify exports,” said Prof Wahiduddin Mahmud, an eminent economist.
He said the government would have to provide subsidies to small sectors, mostly manufacturing industries to carry on the existing export growth momentum.
He was speaking at the Bangladesh Enterprise Institute's stakeholder consultation workshop on “Export Diversification: Challenges and Priorities”. IFIC Bank organised the programme at its headquarters in Dhaka.
Commerce Minister Tofail Ahmed said Bangladesh would be able to reach its export target of $60 billion by 2021.
Prof Mahmud said the manufacturing sector should be focused to make the country's growth export-led. Otherwise, it would not be possible to maintain the current share of exports to the GDP after two or three years.
Salman F Rahman, vice-chairman of Beximco Group, who chaired the workshop, said the government will have to extend the bonded warehouse facilities to all sectors and give cash incentives to small sectors.
He said the government is cutting various policy supports, including cash incentive for the garment sector. “But it is not the right time to discontinue the incentives.”
The businessman urged the government to continue its support so that the garment sector can maintain its growth momentum.
Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue, said intra-garment diversification needs to continue to boost exports.
He said the exchange rate should be kept at the level that helps exporters. The economist said pharmaceutical, leather and light engineering sectors have huge opportunities to contribute to exports if they receive supports.
Allah Malik Kazemi, change management adviser to the Bangladesh Bank, said the global slowdown has affected the exporters.
He said the central bank keeps the interest of exporters in mind while managing the foreign exchange market. Md Nojibur Rahman, chairman of the National Board of Revenue, said there is political commitment from the government to stand by exporters. He emphasised export diversification, saying the NBR also has a role to play by way of supporting small sectors.
Kazi M Aminul Islam, executive chairman of the Bangladesh Investment Development Authority, said the government would have to put more emphasis on agriculture and manufacturing sectors to diversify exports. He said the garment sector grew fast riding on the policy support provided by the government in areas such as bonded warehouse, exchange rate and incentives.
“Other promising sectors should be provided the same policy support so that they can grow,” he said.
Mohammad A Razzaque, project leader of the BEI, said it is stated that the non-garment exports will not grow because of the policy support provided to the garment sector.
He disagreed with the argument, saying promoting export diversification and maintaining the garment sector dynamism must go hand in hand.
BEI President Farooq Sobhan also spoke.