The RMG sector is currently enjoying a 1% cash incentive against export to traditional markets. The govt. has allocated BDT 28 bn in the budget for the fiscal year 2019-20.
Recently officials from the monitoring cell under finance ministry said that Tk 28 bn allocated for the RMG sector in the budget would be insufficient – officials say another 2 bn will be required – to provide the 1% incentive awarded to the sector.
However, the Finance Secretary Abdur Rauf Talukder said to a daily newspaper that it is too early to draw such conclusion of additional funding.
As it will depend on the export trend, Abdur Rauf added, while talking to the journalist from his secretariat office.
The current 1% incentive was declared to keep the Bangladesh RMG sector competitive globally.
Though the experts from the industry cited mixed opinion for the 1% export incentive, as it is going through a critical time due to the rise in production cost. As the industry sought a 5% cash incentive from the government.
The apparel export exceeded $1.44 billion over the government set a target of $32.68 billion for fiscal 2018-19 with shipment from woven increasing to $17.24 billion from $15.42 billion and knitwear to $16.18 billion from $15.18 billion.