The government of Bangladesh has released cash incentives amounting to BDT 8.75 billion for disbursement among major exporters for fiscal year (FY) 2015-16. This amount of subsidies will be distributed among the business communities, which export goods, meaning they will still make profit if they even export goods at it’s production costs.

  • 35 billion total annual allocation
  • 8.75 billion released in September
  • 1.25 billion for Jute & Jute Goods
  • 7.50 billion for Textiles, Leather & Others

The Ministry of Finance on September 16 advised the Chief Accounts Officer of the Finance Division to release the fund in favour of the central bank to start disbursing the second instalment from October to December.

Local exporters have been advised to seek the fund by applying to the central bank through respective banks against their exports during the period.

In the current fiscal, the government has decided to release a total of BDT 35.00 billion as cash incentives.

Of the BDT 8.75 billion cash incentives, the jute and jute product sub-sector will get BDT 1.25 billion, while other sectors will receive the rest of the amount.

During the current fiscal, the jute and jute product sub-sector will receive a total of BDT 5.0 billion cash incentives, while the rest will be disbursed among other export-oriented sectors.

At present, some 14 export sectors, including textile and apparel, frozen fish, leather products, agro-based products and agro-processing industry, halal meat, bone paste, potato, light engineering, ship and pet bottle flakes are receiving cash incentives.

Under the cash incentives programme, potato, halal meat and agro-products are getting the highest 20 per cent cash subsidy.

The small and medium garment factories are receiving additional 4.0 per cent subsidy, while 3.0 per cent are being provided to new products and new market expansion, except the USA, Canada and the EU.

The export-oriented local textiles sector is receiving 4.0 per cent alternative cash incentives instead of customs bond and duty-drawback facility.

Companies producing products from elephant grass (hogla), paddy straw (khor) and sugarcane bark (akher chobra) are given 15 to 20 per cent incentives.

Exporters of bone dust and ships are enjoying the support at the rate of 5.0 per cent.

Leather goods, light engineering and pet bottle are enjoying 12.50 per cent, 15 per cent and 10 per cent incentives respectively.

Frozen shrimp and other fish exporters are getting the support at different rate ranging from 2.0 per cent to 10 per cent, while jute products at 5.0 to 10 per cent.

In fiscal 2014-15, the government allocated BDT 34.0 billion for 14 export sectors, introduced years ago to boost competitiveness of the leading export-earning sectors.

The country earned US$ 31.20 billion in last fiscal showing a 3.39 per cent growth which also fell short of target by 6.0 per cent, according to the Export Promotion Bureau statistics.

Mr. Kauser Bhuiyan is a former EU diplomat and Wall-Street professional who gained sixteen years of professional experience at Accenture, Bloomberg, European Commission and Stein & Partners. He learned professional skills in the areas of Change Management Consulting, International Financial Market, Economic Co-operation and Sustainability Advisory services in Frankfurt, Zurich, London, New York, Brussels, Islamabad and Dhaka. Mr. Bhuiyan can be reached at to[at]

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