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The discontinuation of cash incentives for the country’s export-oriented manufacturing industries will hamper competitiveness for a while during the post-LDC period, but won’t put a long-term impact on exports, said a study group at a workshop on Saturday.
Arfin Ara Begum, director general of the monitoring cell under the finance division led the study group that came up with the view.
It said that efforts were underway to look for alternatives to making up possible losses due to discontinuation of cash incentives for the export-oriented industries.
Besides, the value addition criteria of the exported items receiving cash incentive is needed to be scrapped, according to the study group on subsidy that gave a presentation at the seminar held at the Ministry of Finance.
It is one of the three study groups under a sub-committee on International Tax Mobilisation and Tariff Rationalisation.
A total of seven sub-committees have been working under a national committee led by the principal secretary to the prime minister, Ahmad Kaikaus, since May 2021 in order to overcome challenges of LDC graduation.
In 2021, the United Nations made the final recommendation for the graduation of Bangladesh from the LDC category for its progress in various socio-economic fields in recent years.
It was observed earlier by experts that the transition would rather improve the country’s credit rating, increase productivity and ability to compete globally, broadening the scope of export earnings against a number of challenges following graduation of Least Developed Country status
Officials said that two other study groups in the day’s workshop had proposed a number of proposals to overcome the post-LDC challenges.
The tax mobilisation study group suggested research on tax expenditure to identify unnecessary sectors getting tax exemption facilities and more measures for automation of tax collection.
The tariff rationalisation study group proposed phasing out of para-tariff and supplementary duties.
Officials said that the recommendations of the study groups would be reviewed by the sub-committees for finalising the country’s strategy in the post-LDC graduation.
Ahmad Kaikaus was the chief guest at the seminar presided over by finance division secretary Fatima Yasmin.
Bangladesh Bank governor Abdur Rauf Talukder, National Board of Revenue chairman Abu Hena Md Rahmatul Muneem and commerce secretary Tapan Kanti Ghosh were penal discussants.
Bangladesh Institute of Development Studies director general Binayak Sen and Policy Research Institute chairman Zaidi Satter gave expert opinions.
Federation of Bangladesh Chambers of Commerce and Industry president Jashim Uddin and Bangladesh Garment Manufacturers and Exporters Association president Faruque Hassan were present at the seminar as private sector representatives.
(NA)
