A major portion of the Export Promotion Fund (EPF) of the Export Promotion Bureau (EPB) remained idle due to the failure of the exporters to produce valid export documents while seeking the fund, official sources said.
The EPB, earlier, formed the Tk 50 million EPF for providing initial working capital to the exporters of handicrafts and the ICT sectors against the export orders received by them, reports BDNEWS.
The EPB officials failed to provide the actual data on current size of the fund. A study conducted by economist Dr Atiur Rahman for Bangladesh Economic Association (BEA) in December 2004 showed that the size of the fund increased to Tk 80 million.
The EPB created the fund to provide collateral-free financing at a 4.5 interest rate plus 1.5 per cent bank service charge to encourage exports in these sectors. The EPB sanctions the loan up to the maturity period of the export orders. The Janata Bank manages the fund.
The EPB statistics showed that a total of Tk 14.97 million were disbursed among the exporters since formation of the fund.
Asked about the lower utilisation rate, Monoj Kumar Roy, Director of the EPB, told the news agency that they did not receive appropriate export-related documents from the EPF facility seekers.
"Due to lack of genuine export documents, we had to refuse applications seeking the fund facility," he said.
EPB sources said handicrafts exporters received a total of Tk 1.7 million from the fund. Four handicrafts exporters' enterprises - Craft International, Priyanka Benarashi, Khan Enterprise and Jahanara Cottage - got the fund facility. But, except the Craft International, the remaining three have become defaulters.
The ICT-related goods exporters received the rest of the total disbursement worth Tk 13.50 million. Three exporter firms - De Code Ltd, Visual Soft and Millennium Information - received the soft-loan.
EPB Vice-chairman Mir Shahabuddin Mohammad said the demands in the two sectors are relatively low. "But the fund facility can be expanded if exporters of other potential sectors are included," he said.
"We have asked our members to repay the loan immediately," Md Shahjalal, Secretary of the Bangladesh Handicrafts Manufacturers and Exporters Association, said replying to the query about loan default by its members.
Atiur Rahman, on the basis of his study, said the utilisation rate is smaller because of the carelessness of officials of the Janata Bank and the EPB.
"The government should create an independent fund similar to the PKSF for increasing its utilisation rate," he said. "If the government creates a quasi-government body for managing such a fund, the objective to help exporters might be achieved."
Sarwar Alam, President of Bangladesh Association of Software and Information System (BASIS), said the genuine exporters got the facility.