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The government is actively considering an immediate bailout package for the nascent shipbuilding industry amid cancellation of or slowdown in foreign orders, official sources said.
Bangladesh Bank has given its consent to the recommendations of the 14-member committee on export–oriented shipbuilding industry. The recommendations include lowering of letter of credit margins for importing ship-building raw materials and limiting confirmation charge to 1.5 per cent.
Industry insiders said at least four upcoming shipbuilders—Khan Brothers, Bengal Electric, Meghrhine and Meghna— have stopped proceeding with their investment plans for new yards after Ananda, one of the biggest ship-building companies in Bangladesh, started feeling the pinch of global recession.
Ananda shipbuilding company’s chairman Abdullahel Bari said most of their foreign clients became bankrupt and stopped paying for execution of their existing orders.
Finance minister AMA Muhith said the government would give extra financial facilities to the potential shipbuilding sector facing global recession intensely.
The committee led by the central bank’s deputy governor Nazrul Huda had also recommended that the annual commission on letter of credit for importing shipbuilding raw materials should be only 2 per cent.
The central bank has agreed to refinance 50 per cent of the loans and fixing 10.5 per cent as the highest interest rate on loans for the shipbuilding industry.
It also recommended that shipbuilders could raise fund from the local share market through initial public offers. |
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