The agro-food processing and jute goods-producing industries inside export processing zones (EPZs) are losing traction in export competitiveness for not getting the existing cash incentive facility.
To ensure equal treatment of such units, the Bangladesh Export Processing Zones Authority (BEPZA) has suggested providing cash incentive/subsidy on exports of agro and jute goods units inside EPZs.
It has recently sent a letter to the Prime Minister's Office requesting steps to make a level-playing field to this effect.
The government provides cash subsidy to agro-food processing and jute goods-producing factories outside EPZs against their exportables, it cited.
Some 20-per cent subsidy has been provided for exporting agro goods (vegetable/fruits) and processed agro items in the last fiscal year (FY).
On the other hand, the export of diversified jute goods enjoyed 20-per cent cash subsidy in FY 2019-20.
Some 12-per cent and 7.0-per cent cash subsidies have been provided for the export of jute goods and jute yarn respectively in the last fiscal.
The BEPZA has made a plea to include all types of units-'Type A', 'Type B' and 'Type C' for providing such facilities the units outside EPZs are enjoying.
There are 'Type A' (100-per cent foreign-owned, including Bangladeshi residents abroad), 'Type B' (joint venture between foreign and Bangladeshi entrepreneurs) and 'Type C' (100-per cent Bangladeshi-owned) companies within EPZs.
In the letter, BEPZA executive chairman Maj Gen SM Salahuddin Islam said the existing agro-food processing and jute goods-producing industries have been lagging behind export competitiveness gradually.
On the other hand, new investors are losing interest in setting up agro-based industries in EPZs for not getting cash incentive facility.
Mr Islam, however, noted that the firms are contributing significantly to the export trade.
The 'Type A' and 'Type B' industries have created an estimated 79-per cent employment in EPZs, he added.
According to section 4.0 of the 'Foreign and Private Investment (promotion and protection) Act-1980, "The government shall accord fair and equitable treatment to foreign-private investment which shall enjoy full protection and security in Bangladesh."
The Bangladesh Economic Zones Authority (BEZA) in its governing-body meeting decided to incentivise agro-processing units established inside economic zones, the letter stated.
The BEPZA has also written to finance division which is working on the issue, a source said.
The enterprises operating at eight EPZs under the BEPZA attracted $333.38-million actual investment against the target of $300 million in FY 2018-19.
The cumulative investment stood at $5014.23 million until June 2019 in these EPZs.
From July 2018 to June 2019, the BEPZA crossed the $6500-million target by bagging $1024.11 million.
The cumulative export earnings from the eight EPZs are $74089.23 million, according to the BEPZA data.
