The Bangladesh Textile Mills Association (BTMA) on Monday requested Bangladesh Bank to pay off the loan it took in US dollars from the central bank's Green Transformation Fund (GTF) using the Taka.
In a meeting with deputy governor Abu Farah Md Nasser, textile mill owners also urged the central bank to determine a fixed interest rate for the GTF loan.
They also called for special facilities for loan repayment and the extension of the export development fund (EDF) fund limit and loan repayment period.
The Bangladesh Bank launched the GTF Fund in 2016 with a $200 million refinancing scheme for textiles, leather, jute, manufacturing and export-oriented entities so that they can import capital machinery and accessories for environment-friendly initiatives.
According to central bank sources, BTMA officials in the meeting said textile mills used to get loans from GTF Fund at 2-3% interest as the Secured Overnight Financing Rate (SOFR) was low two years ago.
But currently, more than 8% interest has to be paid due to an increase in the SOFR rate. Hence, they called for fixing the rate at 5%.
In the meeting, BTMA officials said the EDF loan limit should be increased to $30 million.
At the same time, they demanded a 360-day loan repayment facility which was offered during the Covid-19 period.
Apart from this, the textile owners said that currently there is a liquidity crisis in the textile mills due to unsold yarn and cotton.
To meet this crisis, they wanted time till June next year for the repayment of term loans and other loans, plus interest.