|
EXPORT POLICY 1997-2002
Introduction:
1. Acceleration of production and expansion of trade resulting
growth of national wealth. Increased production in export sectors may become
the prime mover in the development cycle in a densely populated country like
ours, as this will generate employment opportunities. As a first step towards
reaching this goal, we need to strengthen the country's production
infrastructure.
2. Our export trade is featured by dominance of a few commodities in a narrow
market. Such dependence on a limited number of export items targeted a limited
market is not desirable for economic development. We must, therefore, aim both
at production and in market diversification; else our export trade will become
stagnant in the near future.
3. Our export trade must keep pace with the projected GDP growth 7% and make
due contribution through increased export earning. In this exercise it is
imperative to identify new thrust sectors, increase export of higher value
added items, diversify product base, ensure product quality, and attain
efficient productivity. We should aim at marketing quality products at
competitive price in proper time.
4. The Export policy 1997-2002 has been designed to operate the market economy
with a view to maximizing export growth and narrowing down the gap between
import payment and export earning.
Objectives :
The principal objectives of this policy are:
1. To achieve optimum national growth through increase of export in regional
and international market;
2. To narrow down the gap between the country's export earning and import
payment through achievement of the export targets;
3. To undertake timely steps for production of exportable goods at a
competitive price with a view to expanding and strengthening existing export
markets;
4. To take the highest advantage entering into the post Uruguay liberalized
market and Globalised international market;
5. To make our exportable items more attractive to the market through product
diversification and quality improvement;
6. To establish backward linkage industries and services with a view to using
more indigenous raw materials expand the product base and identify higher
value added products;
7. To simplify export procedures and to rationalize and solidify the export
incentive;
8. To develop an export infrastructure;
9. To develop trained human resources in the export sector;
10. To raise the quality and grading of export products upto internationally
recognized levels.
Thrust Sectors:
Leather and leather goods industries, high value added
readymade garments, computer software and agro processing sectors have been
identified as thrust sectors in this export policy. Although the leather and
leather goods sector has enormous export potential, this has not been able,
till date, to achieve desired goal. On the other hand, the readymade garments
sector is expected to stage a breakthrough in the export of high-priced, high
value added garments of newer categories after having survived successfully in
the initial phase of exporting low-end garments. Like wise computer software
and agro processing sectors could not record the desired level of export.
Therefore 'four sectors' have been declared 'Thrust Sectors' in this policy to
ensure giving priority with following lines of action;
A) Leather &
Leather Goods:
1. Leather manufacturing units shall be modernized in order to
enabling them to produce increased quantities of finished leather out of raw
hides.
2. With a view to reducing cost of production, steps shall be taken to
establish accessories industries for necessary chemicals and other imputes
within the country.
3. The existing Leather Technology Institute shall be modernized, so that it
can be used as the 'Common Facilities Center' for surrounding leather unit.
4. Necessary credit facilities shall be extended for setting up of leather
goods industries and efforts for marketing the produces shall be strengthened.
5. Cluster industries comprising small units of leather goods factories shall
be set up with a view to generating employment.
6. A 'Leather Council" shall be formed.
7. Industrial units having no bonded warehouse, at the same time not
interested to avail of duty drawback factors, shall be entitled to cash
benefit in back duty drawback.
8. Import of raw hides including wet blue and pickled leather shall continue
to be permitted and shall be exported within the prevailing customs duty
(2.5%) frame and import license fee (2.5%) would be relaxed on the importation
of raw leather for three years.
9. Uniform policy on bank loan and rate of interest shall be followed for
credit to leather sector.
10. The total credit excluded from the leather sector shall be brought under a
single bank and export will also be effective through that designated bank.
11. After careful revision of the overall situation prevailing in the leather
industries, the time-limit for export of crust leather has been extended upto
the year 2000. Facilities for BMRE and other transformation process shall be
made available to all tanning units enabling them to export by 2000.
B) Readymade Garments :
1. All-out efforts would be made for production and export of high-priced
readymade garments in the light of the prevailing market demand.
2. Immediate steps shall be taken to establish a Fashion Institute. Measures
will be taken, under special arrangements, to extend expert services to match
the actual demand;
3. Liberal credit may be considered for capacity building and baring
technology for production of high quality garments.
C) Computer Software:
1. For development of human resources in the field of software export,
introduction of computer science course in all universities including B.I.T.
and Polytechnic institute and selected colleges is being considered.
Similarly, having a pool of skilled and trained instructors, basic computer
scheme at graduation level may be introduced.
2. An Information Technology Village having multiphase facilities shall be
established as part of infrastructure development for promotion of export in
this sector.
3. As a fillip of effective software marketing, appropriate provisions on
protection of intellectual imports shall be incorporated in the existing
copyright Act.
D) Agro Processing:
1. For the development of the agro processing industries, 'Hortex
Foundation' has already been established. Development activities of this
sector under the Foundations programs will go on.
2. Tea estates will be provided with soft bank loans for modernizing the
plants to achieve high yield production and improve quality of products to
strengthen sustain ability in the international market. Development credit
will also be considered for sick tea estates.
3. To encourage export of package tea, duty draw back at flat rate will be
provided on import of packing materials.
4. General waiver for shipment of goods will be granted in an effort to
increase the export of tea.
5. Import of multi wallpaper sacks at confessional customs duty for packing of
tea will be allowed. 6 To establish reputation and brand name of Bangladeshi
tea in overseas markets, publicity measures will be strengthened. Liaison
shall be maintained for this purpose with reputed blending and distributing
agencies.
Product Specific
Decisions:
Readymade Garments
1. Provisions have been made for the exporters of readymade garments
to retain in their respective foreign currency accounts. The exporters shall
be saved from incurring losses by first converting their export earnings to
Taka and then re-converting the same to foreign exchange for payment of import
bills on raw materials.
2. For out of natural and synthetic wool imported under custom's permission
would be accorded to take out wool (for making hand woven sweaters) outside
the bonded area, provided the concerned firm furnishes a bank guarantee for
equivalent amount of customs duty leviable on such raw materials.
3. Import of samples for each category of garments:
At present facility exists for duty free imported 20 pieces of
samples for each category of garments subject to a maximum of 100 pieces per
year. Imported samples are however multi lateral at the customs point.
4. Rationalizing the rate of value addition:
It has been found that keeping the rate of value addition flexible is
congenial for the growth of the country's export trade. Therefore a standing
Committee will be formed for rationalizing the existing rates of value
addition for all commodities including readymade garments.
5. Import of Grey Clothes:
With a view to expanding the base of backward linkage industries,
permission is being accorded for import of Grey clothes through usual
procedure for use in the export industries or for direct export against
specific export orders. So long this facility is given only to the dyeing,
printing and finishing factories. Since value addition in the readymade
garments sector did not take place upto its potentialities, the government has
allowed the exporters of readymade garments to import Grey clothes.
6. Establishment of Fashion Institute:
To sustain in the global competition a Fashion Institute will be established
in the private sector in cooperation with the Export Promotion Bureau for
improvement of quality and design of readymade garments (including Leather
garments)
Frozen Fish
1. Emphasis has been laid on scientific cultivation of shrimps
for increased production and export of shrimp. Various programs including
setting up of a 'Shrimp Development Board', declaring shrimp hatchery as an
'industry'; a 'Credit Assurance Fund' for extending loan facilities to the
shrimp cultivators and lowering of customs duty on import of equipments used
in the cultivation of shrimps, will be taken up.
2. Exporters having fish processing plant will be considered for allotment of
one hundred acres of 'Khas' land for cultivation of shrimps applying modern
techniques.
3. Bank loan on easy terms will be made available on priority basis to the
frozen food processing plants for implementation of the HACCP system.
4. In an effort to strengthen the quality control system of frozen food,
arrangements will be made for import of essential quality control equipments
free of customs duty.
Cultivation of Bamboo, Cane and Coconut
1. Importance has been given to planned cultivation of bamboo, cane and
coconut to meet the increase demand of local raw materials to the handicrafts
sector.
2. A Design Centre will be set up to improve the quality of handicrafts.
Tea Industry
1. The government is contemplating and examining to declare the country's tea
industry to be an export-oriented industry.
2. Land under most of the tea estates at present does not enjoy long term
lease, which is a limiting factor for development activities of tea estates.
To remove such impediment, land will be leased out on long-term basis.
3. Tea estates will be provided with soft bank loans for modernizing the
plants to achieve high yield production and improve quality of products to
strengthen sustain ability in the international market. Development credit
will also be considered for sick tea estates.
4. To encourage export of package tea, duty draw back at flat rate on value
will be provided on import of packing materials.
5. General waiver for shipment of goods will be granted in an effort to
increase the export of tea.
6. Import of multi wall paper sacks at confessional customs duty for packing
of tea will be allowed.
7. To establish reputation and brand name of Bangladeshi tea in overseas
markets, publicity measures will be strengthened. Liaison shall be maintained
for this purpose with reputed blending and distributing agencies.
Jute Industry
1. Reform programs will continue for the development of jute sector.
2. For developing the export of jute and jute goods, wide publicity will be
undertaken abroad on comparative advantage of jute as a natural fiber. Steps
will also be taken to demonstrate the diversified use of goods.
3. As an incentive to export of jute yarn and twine, marketing assistance at
the rate of 10% of F.O.B. value is being extended to the exporters of this
sector for a period of three years commencing from 1997.
Other Sectors
1. Six V-SAT lines have already been established to facilitate
the export of software. Step will be taken to install more lines/connections
to further increase export from this sector.
2. Realizing the importance of software as a potential export sector a
committee was formed to recommend on the potentialities and technical aspects
of the sector.
3. A jewellery export policy incorporating various facilities has already been
formulated to provide necessary impetus to the jewellery and diamond cutting
industry. Formulation of a diamond cutting policy is in its final stage.
INCENTIVES FOR EXPORT
Fiscal Incentive
Duty free import of capital machinery by 100% export oriented
industry outside the EPZ.
Provision for bonded warehouse to facilitate duty free import of raw materials
for export production;
Provision for duty drawback, if the bonded warehouse facility is not availed
of;
Provision for sale of 20% of the products of the 100% export oriented
industries in the local market on payment of duties and taxes;
Provision for tax holiday;
Provision for duty-free import of samples.
Financial Incentives
Provision for local currency export credit at a confessional rate of interest
within a band (the present band in 8-10%);
Provision for foreign currency export credit under EDF at a confessional rate
of interest (the rate of interest applicable is LIBOR + 1%);
Provision for back-to-back letter of Credit for importation of raw materials
for export production, on deferred payment basis;
Retention of export earning by the exporters in their own foreign currency
accounts to the extent of 40% in general cases and 7.5% in lower value added
items like RMG;
Facility for use of US$ 25.00 mm credit line for CIS markets;
25% compensatory cash benefit to the producers and suppliers of fabrics and
other textile products for ultimate purpose of export, in lieu of bonded
warehouse and duty draw-back facilities;
Provision for 10% market development assistance for export for jute yarn &
twine;
Banking facility for consignment sale and BMRE projects;
Export credit Guarantee facility.
General Incentives
Reorganizations of leather industries exporting at least 80% of their products
as 100% export oriented industries;
Enhancing the financial limit for dispatch for export samples abroad;
Provision for product and market development support under Export Development
Fund;
National Trophy for Export.
Source: Ministry of Commerce, GOB
|
