Another Tk 7,000cr for large industries, services sector
The central bank yesterday expanded how big is the stimulus package for large industries and services sector companies to help make the low-cost funds designed for the factories found in the economic zones.
The volume of the package was improved by Tk 7,000 crore to Tk 40,000 crore as part of the central bank's effort to facilitate both local and foreign industries in the professional zones, according to a central bank notice.
Only the units of commercial and service sector companies are certain to get the extended part of the package.
The units that are operating under the Bangladesh Economic Zones Authority, the Bangladesh Export Processing Zones Authority and the Bangladesh Hi-Tech Park Authority will be eligible for the funds to revive their businesses.
There are three types of units -- A, B and C -- in the economical zones.
Firms with 100 per cent foreign ownership are believed as Type-A companies. Joint venture companies with foreign and Bangladeshi ownerships are treated as Type-B and the ones with 100 % Bangladeshi ownerships are Type-C.
The central bank primarily allowed Type-C companies to borrow from the stimulus fund and slowly but surely extended the facility to the factories belonging to both other categories.
The type-C companies availed financial support from the package as they were contained in the package initially, said Abu Farah Md Naser, an executive director of the central bank.
The companies beneath the type-A and type-B categories have not been able to secure funds as the package has almost been depleted after meeting the demand of local firms, he said.
Up to 86 % of Tk 33,000 crore was already disbursed from the package to accelerate the ongoing economical revival, Naser said.
The foreign commercial units, like the local ones, are also hit hard by the financial meltdown plus they are struggling to avail funds from their home countries, he said.
The entire globe is currently in dire straits as a result of coronavirus pandemic and a second wave of the deadly flu has already hit THE UNITED STATES and Europe and several other parts of the world.
If the financial support is not extended to the foreign firms, their businesses will face a serious crisis and many of these will be required to close their units. This will put an adverse effect on the economy over time.
The latest initiative taken by the central bank can help the country brighten its image internationally, Naser said.
The central bank asked banks to submit their loan disbursement plans beneath the stimulus package by November 5.
"The extension of the package can help the economy to a sizable extent," said Emranul Huq, managing director of Dhaka Bank.
The central bank introduced a Tk 30,000 crore stimulus package on April 12, allowing banks to receive an interest rate subsidy of 4.5 per cent on disbursed loans, which the end-users are certain to get at 9 %.
The package was later expanded to Tk 33,000 crore in order that export-oriented industries could pay wages and salaries with their workers.
