Stressing the need for reducing the volume of non-performing loans (NPLs) in the banking sector, a leading trade body fears that soaring defaulted loans would increase the cost of doing business.
The Dhaka Chamber of Commerce and Industry (DCCI) also suggested figuring out wilful loan defaulters to help bring down the volume of NPLs in the banking system.
DCCI president Shams Mahmud made the suggestions at a press conference held at its office on Monday.
"To control NPLs, we suggest figuring out wilful defaulters. If someone fails to repay his loan due to delayed power or energy connections, he should not be considered as wilful defaulters," he said.
He added: "We have to have a secondary bond market. We welcome the prime minister's intervention and her six-point concrete directives to revive the stock market." The DCCI chief also said growing NPLs would increase the cost of doing business as "it fuels the cost of borrowers."
Mr Mahmud underscored the need for launching the secondary bond market and providing single-digit bank loan to help flourish SMEs (small and medium enterprises).
He expressed the hope that the decision to cut the lending rate to single digit would come into effect from April next.
Regarding the government's bank borrowing, he said some of the private sector companies are now availing foreign funds as their credit source.
About VAT (value-added tax), the DCCI chief said businesses paying VAT at the rate of 15 per cent are now eligible for getting VAT rebate.
He also demanded VAT rebate facility for other slabs like 5 per cent, 7 per cent, 7.5 per cent and 10 per cent VAT quota.
The DCCI president said, "VAT rebate in 5 per cent, 7 per cent, 7.5 per cent and 10 per cent slabs would boost SMEs."
Regarding export diversification, the trade body said the readymade garment (RMG) is now the largest export earning sector.
But the country should develop other sectors for boosting its exports.
The DCCI also laid emphasis on research and innovation, smooth supply of electricity and revival of generalised system of preferences for the betterment of the country's textiles and RMG sectors.
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