Around 45 per cent or Tk 55,795 crore of the Tk 1.21 lakh crore stimulus packages announced to overcome the economic shocks from the lingering COVID-19 pandemic was disbursed, which was mainly obtained by influential quarters.
As of October 31, only 31.73 per cent of a Tk 20,000 crore loan package was disbursed to small and medium entrepreneurs while a whopping 70.87 per cent of a Tk 40,000 crore package went to big industries.
The two packages account for almost 50 per cent of the 21 stimulus schemes announced by the government in phases since April to tackle the economic fallout of the COVID-19-induced 66-day shutdown since March 26.
The disbursement under other such packages meant for low-income people, farmers and informal-sector workers was also not good, according to an update disseminated by the ministry finance at a dialogue titled Stimulus Packages for Sustainable and Inclusive Recovery from COVID-19 Fallout in Bangladesh in the city’s Osmani Memorial Auditorium on Thursday.
Former Bangladesh Bank governor Salehuddin Ahmed told New Age on Thursday that the benefit from the stimulus packages based mostly on bank credit was unlikely to reach needy people.
According to the finance ministry update, the RMG sector has availed the entire Tk 5,000 crore allocation at two per cent service charge and has also received Tk 5,500 crore from the Tk 40,000 crore fund meant for large industries.
So far, Tk 428 crore has been disbursed by government specialised banks to rehabilitate returnee workers and affected rural small businesspeople from a package worth Tk 3,200 crore.
The guideline on helping the affected and retrenched workers from various industries is yet to be ready for the disbursement of Tk 1,500 crore.
Another guideline, on disbursing the loan of Tk 2,000 crore to the cottage industries and micro entrepreneurs, is also yet to be completed.
Salehuddin Ahmed blamed the Bangladesh Bank for the poor disbursement of loans to poor people and criticised the reluctance of the commercial banks in this regard, which were favouring the influential quarters.
He said that the recovery of the economic activities was in doubt.
Addressing the seminar, commerce minister Tipu Munshi said that the bankers should boost the disbursement of credit to SMEs.
He expressed disappointment with the reluctance of bankers in disbursing credit to SMEs.
He asked the government to consider the demand placed by Bangladesh Garment Manufacturers and Exporters Association president Rubana Huq earlier at the event s for extending the credit facility for the RMG sector up to June 2021 and extending the repayment period of the previous loan by five years.
Finance Division secretary Abdur Rauf Talukder delivered the keynote speech.
Referring to the latest data on export, remittance and revenue, Abdur Rauf said that the stimulus packages had helped the economy to recovers from the downturn.
The seminar was participated, among others, by principal secretary to prime minister Ahmed Kaikuas, World Bank country director Mercy Miyang Tembon and Japanese ambassador in Bangladesh Ito Naoki, Bangladesh Institute of Development Studies research director Nazneen Ahmed and South Asia Network on Economic Modeling executive director Selim Raihan.
This was the first of the three seminars scheduled to be arranged by the Finance Division to review the stimulus packages that according to most participants were announced timely but needed more efforts for streamlining the disbursement to SMEs.
Selim Raihan demanded the establishment of an independent review panel, removing the bottlenecks in the extension of loans to SMEs, and the announcement of another stimulus package against the looming COVID-19 second wave.
Nazneen Ahmed said that the specialised banks should be given more fund under stimulus plans to address the problems of urban poor and women entrepreneurs.
Mercy Miyang Tembon said that the WB was always ready to meet the additional demand for funds by the Finance Division, underscoring that they should streamline the loan disbursement to the target groups for the creation of new jobs.
Echoing the view, Japanese ambassador Naoki told the government to complete the new automobile policy, settle the telegraphic fund transfer and provide 4 per cent cash incentive also to foreign export-oriented RMG companies.
Ahmed Kaikuas said that the government was not complacent despite achieving initial targets set in the stimulus packages while many developed countries were struggling to cope with the pandemic fallout.
The second seminar under the series titled Employment Creation and Revitalising Rural Economy is scheduled to be held on December 2.
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