Govt mulls subsidy in utility services for businessmen to raise export
The government is likely to give subsidy in utility services instead of cash subsidy in production to help the businessmen in enhancing export growth as the local products have been losing market access to other countries.
The cash incentives will be withdrawn and subsidy in the utility services like gas, electricity and water will be enforced in the production process of export-oriented products as the existing cash incentives are being mismanaged by some quarters, said Commerce Secretary Faruque Ahmad Siddiqi at a keynote paper presentation programme as the chief guest Monday.
The keynote paper on "Market Access Barriers Confronting LDCs' Products" was prepared under Economic Reform and Research Advocacy (ERRA) and submitted by Mohammad Hossain, the former managing director of the Sonali Bank.
The Dhaka Chamber of Commerce and Industry (DCCI) implemented the project in collaboration with the Centre for International Private Enterprise (CIPE), an affiliate of the US Chamber of Commerce, Washington DC, USA.
"Developing the products, producing demand-based items and innovation in production can save us from the western protectionism," said President of the DCCI Sayeeful Islam while he was presiding over the programme.
The communication gap between the chamber leaders and the Commerce Ministry is one of the important local barriers for getting market access of the Bangladeshi products to the international market.
The non-cooperation in providing time-to-time information by the ministries concerned is another major barrier in exporting, he said.
In the keynote paper, the author identified the local barriers as more dangerous than external barriers in getting market access of the local products to the international market.
Locally, the labour issues, corruption, quality of the products, some social compliances and environmental problems are not being addressed properly, the author pointed out in his keynote paper.
Former commerce secretary Sohel Ahmed Chowdhury said if Bangladesh fails in the multilateral trade negotiations there is possibility of preference erosion, which will be an important barrier in the foreign market access.
He urged the government to negotiate for the relaxation of Rules of Origin (ROO) with countries concerned to develop the trade related capacity and for enhancing supply side.
"Bangladesh, as an LDC, should try to remove the barriers in the attraction of FDI as the local resources are not solely able to meet the demand," Chowdhury said adding MODE-4 can solve the problem to greater extent if the present negotiation in this connection succeeds.
Emphasising the need for accreditation certificates from proper sources Alamgir Faruque, another former commerce secretary, said subsidy in the manufacturing industries will help boost export.