Taskforce formed to implement second stimulus package

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FE Report
The government has formed a taskforce to implement the second stimulus package to help the exporters tide over the difficulties caused by nagging energy crisis and global recession.
It has also decided to waive peak-hour electricity charge for garment exporters. The charge for peak hour -- 5:00 to 11:00 in the evening -- was double the rate for off-peak hour.
Finance Minister Abul Maal Abdul Muhith emerging from a meeting with garment exporters on Wednesday told the newsmen that there were some misunderstandings about the implementation of the second package.
"But today we had a good discussion and formed a taskforce to find out the ways to implement the package," he said.
The taskforce will submit its report within two weeks, he added.
Representatives from Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BGMEA) met the finance minister.
The knitwear sector experienced a negative export growth of 13 per cent and woven garment 16 per cent in the July-January period of the current fiscal.
The minister removed the confusion relating to the package and said all the exporters will get incentive from the package.
Earlier, it was decided that the exporters fetching over $3.5 million annually would not get any incentive from the government.
But now over 1,500 garment exporters will get about $100 million cash incentive.
"We have discussed the problems the exporters are facing due to power and gas crisis and the negative impact of the recession that hit the world in 2008," Mr Muhith said.
The minister said the garment exporters would not need to pay 'peak hour' charge due to interrupted power supply.
The government will consider waiving peak hour gas charge and increased power and gas tariff, which was revised upward recently.
The exporters alleged that banks were reluctant to reschedule loan and the minister assured them that he would discuss the issue with Bangladesh Bank governor.
The exporters also protest a government decision under which house rent is brought under 15 per cent value added tax.
The minister admitted that VAT should not be imposed on the exporters and he would look into the matter to waive house rent VAT for BGMEA and BKMEA.
Many garment industries are located in rented houses and they have to pay 15 per cent VAT on the rent.
BKMEA president Fazlul Haque said the stimulus package was not implemented due to bureaucratic bottleneck.
He, however, hoped that the package would be implemented by this month.
BGMEA president Salam Murshedy they are compelled to run their factories with generators due to nagging power crisis.
The government should arrange loan at two per cent for the exporters to import generators, he said.
The country earned $3.54 billion by exporting knitwear and $3.15 billion from woven garments in the first seven months of the current fiscal.