1.0pc cash incentive on FoB for RMG exporters

FT ONLINE

All readymade garment (RMG) exporters will receive 1.0 percent cash incentive on freight on board (FoB) with effect from July 01, 2019.

To this end, Bangladesh Bank issued a circular on Tuesday.

The apparel exporters who receive incentive now for using local yarns or fabrics and the factories which get SME incentive were not entitled to avail 1.0 percent cash incentive earlier.

Even the factories which are provided with incentives for exporting apparel to Euro Zone and non-traditional markets were also not entitled to get 1.0 percent cash incentive before.

"The government has decided to provide special cash incentive for the country's readymade garment sector and textile like terry towel and specialized textile against exports shipped during the fiscal year 2019-20," the circular reads.

The move came after the apparel sector leaders, on different occasions, demanded cash support for all the RMG exporters, sources said.

When contacted, Bangladesh Garment Manufacturers and Exporters Association president Dr. Rubana Huq said it will help but won't be sufficient as this is a 'critical point' and incentive is settled after quite a long time.

"Unfortunately, it won't have an immediate impact," she said, adding that if this incentive would have been given in July, they could have averted hiccup.