Major revision of provision in offing
Sunday, 7 December 2008
Naim-Ul-Karim
The provision for the country's exportable items enjoying the official cash incentive will undergo a major revision in a bid to make the fiscal support more purposeful and time bound, officials said Saturday.
They said the government has already started to scrutinise the exact status of the country's prime export items in the global market as it has planned to bring some of those, which are not enjoying cash incentive benefit, under the net of the state's fiscal support.
The government move comes amid the widespread apprehension that some of the country's prime export items including knitwear and woven garments might face shocks due to the impact of the ongoing world financial meltdown, officials said.
As part of the move, they said, the Ministry of Commerce has already brought the list of the country's prime export items across the table for discussing their fate in world market as financial tsunami started taking its toll on many developed economies.
Secretary of the Ministry of Commerce Feroz Ahmed told the FE Saturday "We have started to review the real status of the country's exportable items."
He said the relevant desk of his ministry has been assigned to prepare a work plan after reviewing the list of existing cash incentive recipient products.
The government in September last made the announcement to provide cash subsidy to 13 export items in the current fiscal for receiving fiscal support cash on the products against net repatriation of the FoB (free on board) prices during the period from July 1, 2008 to June 30, 2009.
The government has decided to provide 20 per cent cash incentive for exporting agro-products, including vegetables and fruits, while it is 15 per cent for leather goods.
Cash subsidy on home-made textile, frozen foods, bone dust, jute goods, potato, bicycle, light engineering products, day-old chicks and halal meat will be given at the rate of 5.0 per cent, 10 per cent, 15 per cent, 7.50 per cent, 10 per cent, 15 per cent, 10 per cent, 15 per cent and 20 per cent respectively.
The products, which are made of 'hogla', 'khra' and 'akher chhobra', will be offered cash incentive at rates between 15 per cent and 20 per cent while 20 per cent for liquid glucose.
Officials said when the government prepared the list of cash incentive recipient products at that time, the world economic situation was not like that of today. In the changed situation, it is now very important to provide more support to traditional major export items instead of non-traditional ones, they said.
"Earlier our focus was to diversify the export basket by selecting products for awarding cash incentive. But now we think that it is high time to protect large quantities of traditional export products of apparel industry," a senior commerce ministry official said.
"We'll submit our report to the ministry head soon," he said, adding there is a need of purposeful and time-bound use of fiscal support so that the export target set for the current fiscal year can be achieved.
The government set the country's export target for the current fiscal year at $ 16.298 billion against the previous year's earning of $14.11 billion, with garments' earning accounting for over two thirds.
The official has, however, refused to disclose which are the export items that may get more or can for the first time come under the cash incentive benefit and which of the existing beneficiaries can either be dropped out from the list or get lower allocation.
The government allocated a total of Tk 8.5 billion as cash incentive for distribution in the current fiscal year, which was Tk 8.0 billion in the last fiscal year.
The provision for the country's exportable items enjoying the official cash incentive will undergo a major revision in a bid to make the fiscal support more purposeful and time bound, officials said Saturday.
They said the government has already started to scrutinise the exact status of the country's prime export items in the global market as it has planned to bring some of those, which are not enjoying cash incentive benefit, under the net of the state's fiscal support.
The government move comes amid the widespread apprehension that some of the country's prime export items including knitwear and woven garments might face shocks due to the impact of the ongoing world financial meltdown, officials said.
As part of the move, they said, the Ministry of Commerce has already brought the list of the country's prime export items across the table for discussing their fate in world market as financial tsunami started taking its toll on many developed economies.
Secretary of the Ministry of Commerce Feroz Ahmed told the FE Saturday "We have started to review the real status of the country's exportable items."
He said the relevant desk of his ministry has been assigned to prepare a work plan after reviewing the list of existing cash incentive recipient products.
The government in September last made the announcement to provide cash subsidy to 13 export items in the current fiscal for receiving fiscal support cash on the products against net repatriation of the FoB (free on board) prices during the period from July 1, 2008 to June 30, 2009.
The government has decided to provide 20 per cent cash incentive for exporting agro-products, including vegetables and fruits, while it is 15 per cent for leather goods.
Cash subsidy on home-made textile, frozen foods, bone dust, jute goods, potato, bicycle, light engineering products, day-old chicks and halal meat will be given at the rate of 5.0 per cent, 10 per cent, 15 per cent, 7.50 per cent, 10 per cent, 15 per cent, 10 per cent, 15 per cent and 20 per cent respectively.
The products, which are made of 'hogla', 'khra' and 'akher chhobra', will be offered cash incentive at rates between 15 per cent and 20 per cent while 20 per cent for liquid glucose.
Officials said when the government prepared the list of cash incentive recipient products at that time, the world economic situation was not like that of today. In the changed situation, it is now very important to provide more support to traditional major export items instead of non-traditional ones, they said.
"Earlier our focus was to diversify the export basket by selecting products for awarding cash incentive. But now we think that it is high time to protect large quantities of traditional export products of apparel industry," a senior commerce ministry official said.
"We'll submit our report to the ministry head soon," he said, adding there is a need of purposeful and time-bound use of fiscal support so that the export target set for the current fiscal year can be achieved.
The government set the country's export target for the current fiscal year at $ 16.298 billion against the previous year's earning of $14.11 billion, with garments' earning accounting for over two thirds.
The official has, however, refused to disclose which are the export items that may get more or can for the first time come under the cash incentive benefit and which of the existing beneficiaries can either be dropped out from the list or get lower allocation.
The government allocated a total of Tk 8.5 billion as cash incentive for distribution in the current fiscal year, which was Tk 8.0 billion in the last fiscal year.