Dhaka Chamber of Commerce and Industry (DCCI) has praised the recent decision of Bangladesh Bank (BB) through a circular for lifting the LC margin on all types of imports except for some luxury goods produced in the country.
It said taking such initiative was imperative in the prevailing situation of the financial sector and the economy with a view to largely remove the economic stagnation caused at the product import level and speed up industrialization, DCCI said in a statement on Sunday.
In addition DCCI expects that the initiative of forming a 'Revolving Refinancing Fund' by the central bank with the aim of expanding the financial services for the development of cottage, micro, small and medium enterprises (CMSME) in the country will make financing entrepreneurs in this sector easier.
As per the directives of the central bank, from now on importers can import all types of capital equipment, consumer goods and capital raw materials without any margin on the basis of bank-customer relationship.
Moreover, if imports increase; new investment, re-investment, availability of capital equipment and overall industrial production will subsequently increase to bring a positive result in export growth, DCCI president Ashraf Ahmed said.
Along with this, he said supply of raw materials to industries will also increase. As a result, factories will be able to ensure full-fledged production at their highest capacity. Supply of products in the market will increase and may have a positive impact on the overall inflation.
DCCI said while the country is experiencing liquidity crisis, especially difficulties in obtaining easy lending by CMSMEs and lower credit flow to private sector such an initiative of a 'Revolving Refinancing Fund' by the central bank would play a pivotal role in getting refinancing benefits to small entrepreneurs.
The DCCI believes this fund will be useful for the growth of production of goods and services and income and employment generation of the CMSME sector.
This fund will also help the affected small entrepreneurs in meeting their need of working capital to turn around. Especially for CMSMEs, in case of refinancing under this fund, the interest rate will never exceed 8 percent and in this case no supervision charge or even early settlement fee can be imposed to the relief for CMSMEs.
DCCI further said the CMSME sector is the main driving force of the country's economy. If the CMSME sector is given special advantage in the development of backward linkage industry and employment generation, its positive impacts will no doubt be reflected in the overall economy.
