Govt likely to offer cash perk from next FY

The government is considering providing cash incentive facility to the garments accessories and packaging industries - to continue the present export trend of the country's RMG sector, sources said.
The industries are likely to enjoy the incentive facility from the next fiscal year (FY), 2023-24, they added.
The Ministry of Commerce (MoC) has recently written to the Ministry of Finance for providing the facility. It has also suggested preparing a combined circular for the country's clothing sector.
The decision came following a meeting with the stakeholders after reviewing applications of the Bangladesh Garments Accessories and Packaging Manufacturers and Exporters Association (BGAPMEA).
The representative of the Finance Division, who attended the meeting, assured of considering the MoC-recommended incentive facility from the next FY.
Local garments accessories and packaging makers demanded cash incentive last year also.
Fabrics and accessories are two major raw materials of the RMG industry. Some 1,900 accessories and packaging makers under the BGAPMEA act as the backward linkage industries of the RMG sector and meet almost its total demand, industry insiders said.
An official said the Finance Division did not consider most of the recommendations, sent by the MoC for providing export incentive.
The division did not sit for any review meeting on the issue in the last two years, he added.
Some 43 sectors are enjoying the government's cash incentive incentive/subsidy, ranging from 1.0 per cent to 20 per cent, against their export earnings in the current FY, 2022-23.
The RMG sector enjoys bonded warehouse and cash incentive facilities. But the accessories and packaging industries do not get any cash benefit despite their hefty  export earnings. Currently, some 15 accessories and packaging products are exported to 21 countries and regions, including the Netherlands, South Africa, Pakistan, India, Middle-East, Ethiopia, Indonesia, Italy, Sri Lanka, Turkmenistan, Germany, Austria, etc.
The sector earned about US$ 7.67 billion (deemed and direct export) for the country during FY 2021-22, of which about $ 1.0 billion was direct export. It has set an export target of $ 12.00 billion by the end of 2025. More than 0.7 million employees are working in the sector, of which 20 per cent are women, according to the association.
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