The government is overwhelmed by fiscal aid proposals from private banks and industries, including readymade garment, poultry, cement and ceramic industries that have been hit hard by the prolonged blockades and hartals as well as the prevailing political deadlock.
A large number of proposals have poured into the Finance Division and the Bank and Financial Institutions Division from different quarters requesting immediate financial support from the current fiscal year’s budget.
Applicants are saying they have incurred huge losses because of the stagnant economy and political deadlock, Bank and Financial institutions Division Secretary Dr Aslam Alam told the Dhaka Tribune yesterday.
He said the majority of them were readymade garment manufacturers and they were demanding big amounts along with loan rescheduling and change in the definition of defaulters, which could affect the banking sector.
“We are considering loan rescheduling and changes in the definition of default loan,” he added.
“The chairman and members of the ceramic association met me at the banking division on Tuesday, demanding rescheduling of bank loans and waiving interest,” Alam said.
The delegates told him many of their factories had to be shut down due to blockades and the export of ceramic items had stopped completely.
“We do not know when this economic destruction will end and whether it will continue into the next year,” the secretary added. He said the banking sector was the most vulnerable sector in this crisis. But the government does not have enough funds allocated in the current fiscal year’s budget to support the affected sectors.
Revenue earnings have seen an alarming decline, with five-month shortfall now standing at Tk5,000cr, he said. While on the other hand fiscal support needed for the garment export sector alone may cross Tk2,500cr, he added.
Last week, Finance Minister AMA Muhith assured that the demands of apparel makers affected by the current political crisis would be taken into consideration. The assurance came at a meeting with readymade garment, knitwear and textile sector leaders at the ministry.
Their demands include payment of four months’ worth of workers’ wages, creating special PCs and Bai-Salams (advance payments for delayed deliveries) to be adjusted in the next two years, among others.
Banker and economic analyst Mamun Rashid told the Dhaka Tribune that several business chambers including the Metropolitan Chamber of Commerce and Industry had estimated a total damage of Tk35,000cr caused by the prolonged political deadlock.