PM unveils Tk 72,750cr package to address the impact of coronavirus
Prime Minister Sheikh Hasina today unveiled the government's plan to address the possible impact of coronavirus on the country's economy, declaring an allocation of Tk 72,750 crore under a set of stimulus packages.
"Earlier, I declared a Tk 5,000 crore (emergency) incentive package for paying the salaries and allowances of export-oriented industries' workers and employees. Today I am announcing four fresh financial stimulus packages of Tk 67,750 crore," she said in a nationwide televised address from her official Gono Bhaban residence this morning.
The premier said with the fresh allocations, the total amount of financial assistance would stand at Tk 72,750 crore, which is nearly 2.52 percent of GDP.
The PM said the government simultaneously took four programmes under the plan, to be implemented in phases categorised as "immediate, short and long."
The four programmes are: increasing public expenditure, formulating a stimulus package, widening social safety net coverage and increasing monetary supply.
The first of the four packages, involving Tk 30,000 crore, will be provided to affected industries and service sector organisations as working capital through banks as low-interest loan, she said.
Commercial banks would provide the amount as loans from their own funds to concerned industries and enterprises on the basis of bank-client relations, she added.
"The interest rate of this lending facility will be 9 percent. Concerned industries and business organisations will pay 4.5 percent interest, while the government would pay the remaining half to banks as subsidy," she said.
Under the second package, small and medium enterprises, including cottage industries, would get Tk 20,000 crore as working capital.
"The interest rate of this lending facility will be 9 percent and the concerned industries and business organisations will pay 4 percent interest of that loan, while the government will provide the remaining 5 percent as subsidy," the PM said.
The third package, she said, is meant for enhancing Bangladesh Bank's Export Development Fund -- from $3.5 billion to $5 billion -- to facilitate raw material imports under back-to-back LC.
The prime minister said under the fourth package, the central bank will introduce a new credit facility of Tk 5,000 crore as "Pre-shipment Credit Refinance Scheme" and its interest would be 7 percent.
She said local products alongside the export sector would deserve special attention to cope with the possible global and domestic economic crisis caused by the pandemic.
Generating employment will be given priority in public expenditure while foreign tours and lavish expenditure will be discouraged.
Some low interest credit facilities will be launched through the banking system mainly to rejuvenate the economic activities, keeping the job of the workers and employees as well as the competitive edge of the entrepreneurs intact.
The coverage of the existing social safety net would be further widened to fulfil the basic needs of people living below the poverty line, day labourers and people who are engaged in non-formal works.
Notable programmes are distributing food materials free of cost, selling rice at Tk 10 per kg, distributing cash among targeted communities, widening the coverage of old-age allowance, widow allowance and allowance for the women oppressed by husbands at 100 most poverty-prone upazilas of the country, she said.
The prime minister said the fast spread of coronavirus, huge pressure on health services, unprecedented lockdown and stagnant communication to curb the pandemic have already started putting negative impact on the global economy.