Bangladesh’s apparel manufacturers and exporters are in line for a flat cash incentive, regardless of export destination or criteria. A five per cent cash incentive looks likely. Currently, the four per cent cash incentive on exports is applicable for manufacturers or exporters exporting to non-traditional destinations and fulfilling a number of criteria. Also the subsidy to fuel the business sectors may be raised by over 22 per cent.

The industry has requested for more measures. These include an exchange rate according to market mechanism; doubling the default loan rescheduling deadline; VAT exemption for apparel manufacturers, including for the use of utility services like power, gas, water and others; keeping the source tax at 0.25 per cent; lowering the corporate tax rate to ten per cent for apparel manufacturers like what it was before; duty-free imports of safety equipment like fire rated paint, solar energy operated lamps, close-circuit camera systems, and archway gates; exemption from stamp duty; special interest rates for bank loans for apparel manufacturers; creating a special emergency fund for medium and small manufacturers who are on the verge of closure; and a fund for technological advancement in the apparel sector.

Apparel exports contribute around 83 per cent to Bangladesh’s total export basket.