The central bank finds it difficult to finance projects under its Equity and Entrepreneurship Fund (EEF) due to dearth of resources, officials said.
About 65 per cent projects under the Fund's ambit are eligible for receiving money, sources concerned said.
"We are slow in providing funds to projects pending with us. While the EEF agro-fund suffers from fund deficit, the EEF's IT Fund has a significant volume of surplus," officials said.
The government's financial support to the EEF traditionally has not been sufficient. The amount should be increased according to demand, sources said.
A sum of Tk 5.0 billion has been earmarked in the current fiscal year (FY) for the EEF to extend its equity support. Of the amount, Tk 2.50 billion has already been released to the agro-based industry projects.
The EEF unit of Bangladesh Bank (BB) has recently urged the ministry of finance (MoF) to release the rest of the amount. The MoF already issued a cheque of Tk 2.50 billion for the agro-based industry projects under EEF.
The ICB sanctioned over Tk 24.94 billion against 1,342 agro-related projects under the EEF until February 28, 2014. An amount of Tk 8.83 billion was disbursed under EEF, according to the latest data.
Currently, some Tk 16.11 billion is urgently needed for the approved agro-based projects. The EEF agro-fund is now left with only Tk 3.79 billion of BB and ICB, according to BB data.
Under such circumstances, if the sector gets the rest amount of Tk 2.50 billion from the government, the authorities concerned should take initiatives to release the rest of the money for the agro-processing sectors for their proper implementation.
The government introduced the EEF in the fiscal year (FY) 2000-01 to help promote entrepreneurship and create employment generation in the risky, yet promising, areas of agro-based industry (excluding the conventional sub-sectors such as rice mills, flour mills, fishing trawlers, and cold storage etc), and information technology (IT).
The decade-old fund was earlier managed by Bangladesh Bank (BB). In June 2009, the central bank transferred its management to the state-owned Investment Corporation of Bangladesh (ICB).
The ICB Capital Management Ltd. acts as project appraisal arm for EEF.
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