The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) has urged Bangladesh Bank (BB) to double the Export Development Fund (EDF) to $5 billion to support exporters amidst ongoing global economic challenges.
The demand was placed at a meeting with BB Governor Mostaqur Rahman, held at the central bank on Monday.
The apex trade body also proposed increasing the "Single Borrower Exposure Limit" from the current 15% to 25% to accommodate the rising costs of doing business.
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During the discussion, the FBCCI representatives further advocated for keeping interest rates within single digits and relaxing loan default regulations.
In written proposals submitted to the BB chief, the FBCCI highlighted that geopolitical instability and global economic shifts have significantly driven up the prices of industrial raw materials, capital machinery, energy, and transportation.
"The ongoing conflict in the Middle East poses a threat to energy supplies, remittance inflows, and overall economic activity," the proposals stated, noting that international demand for Bangladeshi products has also faced downward pressure.
Key recommendations from the private sector
The FBCCI placed a broad set of coordinated recommendations aimed at stabilising the financial sector and sustaining industrial growth.
It emphasised the need for good governance and structural reforms in the banking sector. It called for effective measures to recover laundered money and urged the central bank to protect the interests of depositors and businesses during bank mergers.
To keep production and trade afloat, the trade body demanded a steady supply of US dollars, a stable exchange rate, and a simplified process for opening Letters of Credit (LCs).
For industries struggling with the current economic climate, the FBCCI suggested extending the loan rescheduling period from the current three months to six months, alongside providing easier loan terms and incentives.
It also emphasised expanding support for SMEs and women entrepreneurs through enhanced banking access, dedicated helpdesks, and collateral-free loans.
To reduce energy import costs, the trade body recommended low-interest loans for renewable energy projects, including solar power.
It proposed the formation of a special committee, headed by a Deputy Governor of Bangladesh Bank, to quickly resolve banking-related issues facing the industrial sector.
The business leaders also urged the government to reduce its borrowing from the banking sector to ensure a healthy flow of credit to the private sector and to maintain incentives for remittance to encourage higher inflows of foreign currency.