He made the call while addressing a press conference on the current economic status of the country and to share DCCI’s Annual Plan of Action for the year of 2020 at its office in the capital.
In the first week of this month, Prime Minister Sheikh Hasina asked banks to implement the single-digit interest rate from April.
In December, a board meeting of Bangladesh Bank decided to cap the interest rate on industrial loans in a move that would be a boon for manufacturers as their cost of funds will reduce to single digit.
Shams Mahmud discussed many economic issues, including export diversification, skills development, economic diplomacy, capital market, energy security, 4IR, VAT, Tax, FDI, doing business, research, innovation, infrastructure, SME and SDGs.
He said lack of market information, standardised quality products, access to finance, technical knowhow and SME-friendly infrastructure like design centre are main challenges for the SME sector. “The contribution of the SME sector to the GDP is hovering around 23-25 percent,” he said.
The DCCI chief underscored the need for policy advocacy for the single-digit interest rate for SMEs, flexible collateral requirement and other requirements to access to the loans.
Mentioning that presently VAT rebate is allowed for 15 percent VAT quota, he demanded VAT rebate facility for other slabs like 5 percent, 7 percent, 7.5 percent and 10 percent VAT quota, saying this will boost SMEs.
Bangladesh needs $928.48 billion till 2030 to implement Sustainable Development Goals (SDGs), Shams Mahmud said, adding that of the amount, $486.33 billion needs to be financed by the private sector.
He underlined the need for reskilling and upskilling of human resources in line with the 4th Industrial Revolution (4IR) demand and providing policy support for reshaping business ecosystem.
“RMG is our only largest export earning sector, but we need to develop other sectors as well to back up the RMG,” the DCCI president said, calling for bonded warehouse facility, back-to-back LC to leather products, tax rebate and new technology adoption to promote the other sectors.
Bangladesh is in critical crossroads in terms of worldwide political and economic situation, he said, suggesting that willful defaulters be figured out to control the non-performing loans. “But if someone fails to repay his loan due to delayed power or energy connections, he should not be considered as willful defaulters.”