Bangladesh’s garment exporters have sought sovereign guarantee against Tk800 crore bank loan to acquire land for an industrial park at Bausia in Munshiganj for the apparel sector.
But a senior finance division official said the government could not provide any sovereign guarantee to any sector under the International Monetary Fund’s condition of the extended credit facility (ECF).
He said if the government provides Tk800 crore guarantee, it would exceed the limit set by the IMF.
The commerce ministry forwarded the proposal of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) to Finance Minister AMA Muhith last week.
As per the proposal, BGMEA wants to take Tk800 crore credit from commercial banks in home and abroad with a seven-year term under the guarantee.
Earlier, BGMEA decided to sign a memorandum of understanding (MoU) with Hong Kong KRD International Investment Group Ltd to build the park.
The KRD will fund Tk1,400 crore for land acquisition and development.
According to BGMEA decision, the industrial park will be established on 532 acres of land, of which 30% will be used for infrastructural development and the rest for factories.
Meanwhile, the IMF recently assessed Bangladesh’s debt situation and the results indicated that the country remained at a low risk of debt distress.