Over a 27-percent decline in export of agricultural goods in the last fiscal nudged the Ministry of Agriculture (MoA) into action and detected 15 hurdles needing a remedy for the sector to perform better through a rebound.
An interministerial meeting is going to be held in this connection on August 30 at the ministry, led by the MoA secretary, an official said.
A report was prepared on outcomes of a meeting on agricultural-product-export roadmap and potato-export-boosting roadmap, held on January 30 this year, said a senior official at the ministry.
At the meeting it was decided that the MoA would sit with the National Broad of Revenue and the civil aviation ministry to resolve those matters.
The report has recently been sent to ministries and agencies concerned, said the officials.
He said among the obstacles pinpointed by the MoA, several stand out as significant roadblocks to successful agricultural export, including a lack of necessary space at airports for efficient handling of shipments, coupled with higher freight charges.
"Higher prices of packaging materials have also been a source of distress, hampering the competitiveness of Bangladeshi products," says a report prepared by the ministry and sent to concerned ministries, inducing the MoC.
Furthermore, the absence of sufficient cold-storage facilities at airports hinders preservation of perishable goods, adding another layer of complexity to the export process.
Escalating container costs, surging three to four times their usual rates, have exacerbated the financial burden on exporters.
The unavailability of a Food Safety and Standards Authority of India (FSSAI)-authorised laboratory in Bangladesh has created a bottleneck, pushing exporters to incur higher testing costs.
"This discrepancy in testing expenses has rendered Bangladeshi exporters less competitive compared to their counterparts in India," says the report. The MoA report mentions that BSTI charges Tk 18,000 for a test when FSSAI demands 6,000 rupees (equal to Tk 7,860)
In addition, the lack of tariff facilities under the South Asian Free Trade Area (SAFTA) treaty at seaports has limited the benefits that could otherwise be derived from this regional-trade agreement.
The absence of suitable potato varieties for export, other than diamante or carrej, which possess unfavourable characteristics, has posed a challenge.
These varieties demand excessive amounts of edible oils during processing, contravening standards set by the state-run standardisation institute, BSTI.
The imposition of high duty on packaging raw materials has further escalated the cost of production, rendering exports less competitive on the international market.
The ministry also acknowledged limited cash incentives-merely 10 percent-for the export of jute products, despite the industry's potential.
Moreover, the controlled aromatic- rice export and restrictions on fragrant rice have led to a loss of market share, according to MoA report.
Meanwhile, Export Promotion Bureau data showed export of agricultural goods and relevant processed foods fall drastically by 27 per cent in the just-concluded fiscal year to US $843.03 million against $1.16 billion in FY'22.
Asked, Bangladesh Fruits, Vegetables and Allied Products Exporter's Association president SM Jahangir Hossain told the FE that the exporters are sharing those problems with the government for a long time.
He said export earnings from vegetables in FY'23 decreased to just $61.14 million from $164 million in FY20.
"Shipment of processed foods, the key export earner, also declined drastically amid a hike in production/export costs as well as a decline in demand in the target countries," he said.
He thinks minimising operational cost through infrastructural development is "only way to compete with our counterparts".
In response to these challenges, MoA is proactively taking steps to address them.
On August 30, the ministry is set to convene a comprehensive meeting involving pertinent stakeholders, such as the National Board of Revenue, the Ministry of Commerce (MOC), the civil aviation ministry and others.
The aim of this meeting is to foster collaboration and brainstorm solutions that will help mitigate the aforementioned obstacles.
tonmoy.wardad@gmail.com,
rezamumu@gmail.com