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Govt to reassess waiver of loans worth Tk 6.86b

Bailout proposal for 133 RMG units

FE REPORT | October 06, 2020 00:00:00

The government will scrutinise further a BGMEA proposal for waiving the entire bank loan liabilities of as many as 131 readymade garments (RMG) units, a person familiar with the situation said.

The decision came at an inter-ministerial meeting with commerce secretary Md Jafar Uddin in the chair held at the ministry on Monday.

Senior officials of ministries concerned, representatives from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) were present at the meeting.

When contacted, the commerce secretary said, "We will examine further the proposal for exempting the 131 ailing RMG factories from the repayment of bank loans. A committee will work on the matter and then we will take the next course of steps."

In 2019, BGMEA president Rubana Huq requested the finance minister AHM Mustafa Kamal for considering waiving the principal loan amount, interest and other costs of 133 RMG units, said a senior official of the ministry.

In response to the BGMEA application, the finance ministry then had asked for the central bank's opinion on the issue.

Receiving the finance ministry letter, Bangladesh Bank (BB) asked the banks to send the loan information about 131 out of the 133 factories.

After the collection the loan data, the BB informed the finance ministry that the government would require over Tk 6.86 billion for repaying all existing liabilities to the banks concerned.

Of the amount, the principal loan amount is over Tk 5.52 billion, according to the commerce ministry document.

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