Success Stories

Stories of Progress

Reforms in


Trading Ceiling for Bank Increased

Bangladesh Bank has issued a circular on 5 September 2019 where a definition of trading was given for micro and small entrepreneurs. The amount of replacement cost except land and building for micro-business, it is 10 Lakh BDT, workforce 15 and those who have annual transaction not more than BDT two crore. Previously, the fixed asset cost except land and building for the micro-industry was less than BDT 10 lac, and the required workforce was a maximum of 5 persons. In the case of small industry the allowed limit is BDT 10 lac to 2 crores for which workforce is 16-50 and those whose annual turnover / annual transaction is not more than BDT 2 crore to 20 crores. In the earlier circular, for small industry, the allowed limit for the fixed asset was BDT 5 lacs to BDT 1 crore, and the required staffing was 6-10 persons. This issue was also discussed in the 6th SMEDWC meeting held on 24 July 2019 at MCCI.

Chamber/Associations/Trade Bodies/CMSME — Social Guarantors

In the 7th Financial Sector Development WC meeting, BUILD proposed that including related chamber/associations/trade bodies/CMSME trading organisations can be the recognised organisation to provide a social guarantee. This has been included in the SMESPD circular- 2 of Bangladesh Bank issued on 5 September 2019.

Direct Financing in Euro in Green Transformation Fund

The issue regarding direct financing in Euro in export financing was highlighted in the study on ‘Financing Schemes and Available Credit Facilities for Export Competitiveness of Bangladesh’ presented in the 7th FSDWC meeting of BUILD chaired by Deputy Governor, Bangladesh Bank held on 7 August 2019. In the discussion, the feasibility of expanding import payment through Euro against their usance L/C in export financing came up. The stakeholders also requested the central bank to explore how to use the settlement with different currencies such as Euro, RMB etc. BUILD recommended that direct financing in Euro can be explored in export financing. Through FEPD Circular No. 20: on 15/04/2020, Bangladesh Bank has added 200 million Euros to the existing $200-million Green Transformation Fund to refinancing environmentally-friendly projects. From the new fund, all export-manufacturing industries will be able to avail loans in Euros through authorised dealer banks at less than 2% interest to import environment-friendly and energy-efficient capital machinery and accessories, including buyer’s credit. Authorised Dealer banks can borrow money from this fund at a 1% interest rate to further finance the exporters-manufacturers. With this loan in Euros, industries can import industrial raw materials to use in all manufacturing enterprises, including export-oriented ones and deemed exporters. GTF is the concessionary loan for importing capital machinery and accessories for all export-oriented sectors in the country. Through this reform, direct financing in Euro has been initiated in the export financing. If the user experience is positive, the other export financing in foreign currencies such as RMB can also be explored.

Inclusion of New Products/Initiatives in the List of Environment-Friendly Green Products/Initiatives of Bangladesh Bank

BUILD recommended the inclusion of new products/initiatives in various sectors in the list of Environment-friendly Green Products/Initiatives of Bangladesh Bank for green financing. This issue was highlighted in the study on ‘Financing Schemes and Available Credit Facilities for Export Competitiveness of Bangladesh’ presented in the 7th FSDWC meeting of BUILD chaired by Deputy Governor, Bangladesh Bank held on 7 August 2019. Bangladesh Bank established the Refinancing Scheme for Green Products/Initiatives with its fund in 2009. The fund provided refinancing for investment in fifty-one products under eight categories. After conducting the study mentioned above, BUILD recommended including new green products in several categories related to recycling, sludge incineration, waste management, and implementation of circular economy to emphasise green financing. In a recent meeting with Sustainable Finance Department on 28 November 2019, BUILD requested the Central Bank to include Rooftop Solar in the list of green products/initiatives.

Through publishing the new Master Circular (SFD Circular No. 2 dated 30 April 2020) on Refinancing Scheme for Environment Friendly Product/Initiative/Project, Bangladesh Bank has extended the number of environment-friendly products/initiatives/projects to fifty-five products under nine categories from the previous fifty-one products under eight categories. The newly included products are Medical Waste Management Unit/Plant and E-Waste Management Unit/Plant under Solid Waste Management, Net Metering Rooftop Solar System, Solar Pico Grid and Solar Nano Grid under Renewable Energy.

Increase of Fund Limit of Refinancing Scheme for Environment-Friendly Green Products/Initiatives/Projects

BUILD requested the Sustainable Finance Department of Bangladesh Bank to extend the limit of the Refinancing Scheme for Environment-friendly green Products/Initiatives/Projects from BDT 200 crore to BDT 400 crore. This reform recommendation was sent to SFD, Bangladesh Bank, through a letter dated 3 December 2019. In order to broaden the financing avenue for green products like solar energy, bio-gas plant and effluent treatment plant, etc., Bangladesh Bank established a revolving refinance scheme amounting to Taka 2 billion (200 crores) from its own fund for solar energy, Bio-gas and Effluent Treatment Plant (ETP) in 2009. The product line previously was enhanced to 51 under 08 categories. Formulation of the new master circular (SFD Circular No. 2 dated 30 April 2020) indicates the extension of the product line to 55 products under nine categories. Since inception, the total amount of Tk. 4,488.99 million has been disbursed as refinance facility from the fund till 31 December 2019. This particular fund performed better than Green Transformation Fund so far in terms of green financing. The extension of the fund limit to BDT 400 crore will encourage more industries to avail green financing in various aspects in the near future.

Income Tax Exemption Limit Extended

BUILD proposed for extension of Income Tax exemption limit at least up to BDT 350,000 for the next five fiscal years; presently, the exempted income is BDT 250,000. In the year 2020-21 National Board of Revenue has increased the threshold up to BDT 300,000. Exemptions limit for a disabled person has also been increased to 500,000, and earlier, it was 400,000 BDT.

Reduction of Advance Tax

BUILD proposed reducing Advance Tax to give relief to businesses to import raw materials at lower costs. In Finance Bill 2020, the Advance Tax (AT) on imported raw materials for manufacturing industries have been reduced from the existing 5% to 4%. At the same time, NBR also reduced Customs Duty on import of 10 Agricultural Machinery/Parts to 1% from the existing 5-10% CD. These reforms would help encouraging investors to run their business.

Wet Blue Leather Export Is Allowed by the Government

BUILD recommended allowing exporting wet blue leather through a study on “Raw Hide Price Fixation for Upcoming Eid-ul-Azha 2020”. This recommendation was also placed to the Ministry of Commerce by BUILD in the meeting on Cash Subsidy on 7 June 2020 at the Ministry of Commerce. The government has decided to allow traders to export rawhide and wet blue hide as part of efforts to keep supply and demand stable after cattle slaughtering during Eid-ul-Azha. The decision was announced on 29 July 2020, through Mass Notice no. 39 of the Office of Chief Controller of Imports and Exports in order to develop the leather sector. In the last season of animal sacrificing, piles of thousands of rawhides were left to rot in the streets after the merchants declined to buy the rawhides from seasonal traders or offered low prices following a dispute with the tanners over dues. It appears that relaxation of the export rules is required to keep the market stable. This approach is expected to avert an impending collapse of the leather industry and to free the tannery owners from a hostage-like situation.

Credit Guarantee Scheme Is Allowed for CMSMEs

Bangladesh Bank has introduced a Credit Guarantee Scheme (CGS) aimed at easing financing support for the cottage, micro and small (CMS) enterprises through a SMESPD Circular no. 3 issued on 27 July 2020. Initially, this scheme facilities will be applicable for Stimulus Packages of BDT 20000 crore as collateral-free working capital loans to support the CMSME sector. BUILD raised this issue of introducing a credit guarantee scheme for the CMSMEs in several platforms and also in a virtual dialogue named ‘Access to Stimulus Package for COVID-19 Affected CMSMEs in Bangladesh’ held on 20 May 2020. The CGS will help expedite the implementation of the government-announced BDT 20000 crore working capital loans for the CMSME. CGS will be used in replacement of collateral issues that CMS is facing for quite a long time. This initiative will ensure more competitiveness of the CMS enterprises in terms of access to finance, and as a result, these COVID-19 affected enterprises will become more vibrant.

Working Capital Limit for CMSMEs Under the Stimulus Package Increased

At the 8th Meeting of the Financial Sector Development Working Committee (FSDWC) of BUILD held on 18 August 2020, via Zoom Web Platform co-chaired by Ahmed Jamal, Deputy Governor, Bangladesh Bank and Shams Mahmud, President, Dhaka Chamber of Commerce and Industry (DCCI), BUILD proposed for subsidised loans for CMSMEs to cover at least 50% of the working capital instead of the present level of 30% for affected CMSMEs. On 31 August 2020, Bangladesh Bank issued a SMESPD circular letter no 07, where the increased ceiling of working capital loan up to 50% from the existing 30% has been approved for manufacturing and service industries. Furthermore, on 28 September 2020, Bangladesh Bank issued SMESPD circular letter no. 10, where Bangladesh Bank allowed 50% subsidy on approved working capital loan for individual commercial banks which was earlier on actual disbursed working capital loan for CMSME.

Individual ETP Allowed for Private Sector

Central Effluent Treatment Plant (CETP) of Tannery Industrial Estate of Saver, Dhaka (TIED) was not in function entirely. To analyse why the CETP is not fully functionalised in TIED, BUILD took up the case while also trying to understand the private sector’s need. BUILD prepared a concept note on “Approval of Effluent Treatment Plant (ETP) in Parallel with CETP in TIED”, where it suggested that Permission for Individual ETP is a key concern for the private sector. From a private sector viewpoint, two large tanneries – Apex and Bay Tanneries – have applied for individual ETP provided that they bear all costs of CETP. BUILD placed this recommendation on the 12th Private Sector Development Policy Coordination Committee (PSDPCC) on 10 February 2020 at PMO. Following numerous follow-up and advocacy of all concerned and BUILD, the Ministry of Industries issued an Order on 23 July 2020 where they allowed Apex Tannery and Bay Tannery to set up individual ETP in Saver Tannery Industrial City followed by some rules and regulation mentioned in the order. A Central Effluent Treatment Plant was supposed to be set up in order to manage the waste of all factories in the tannery industrial city, but the plant has not finished in eight years. Due to the lack of proper waste treatment and drainage, the environment around river Shapeware and adjacent areas is seriously being polluted. Tannery waste management is not only crucial for the environment, but also for commercial reasons. The tannery industry of a country does not receive international recognition if it does not follow proper waste treatment procedures. Big brands do not buy such industry’s leather goods. It is crucial for tannery companies to be certified by the internationally recognised Leather Working Group (LWG) for export.

Preparatory of 14th PSDPCC Meeting Held

A meeting with DG, PMO and Director-1, Anisur Rahman, was held on 29 October 2020 at the office of the DG to discuss the 14th PSDPCC meeting. Zubaida Nasreen, at the outset, wanted to know about BUILD and PSDPCC. CEO, BUILD, gave a brief to the DG about BUILD and PSDPCC and the outcome of the last 13 PSDPCC meetings. The discussion was held on the agenda of the 14th PSDPCC meeting. There was a detailed discussion on the PSDPCC process and how it can be made more workable for the private sector development. Anisur Rahman asked about some of the information included in the BUILD’s presentation regarding poverty issues that quoted a BIDS study. BUILD CEO and Research Associates explained the issue. Regarding special treatment for Cottage and Micro enterprises, BUILD CEO also explained their justification. Concerning BOND Policies, all of them agreed about the discrimination the non-RMG sector is facing.

Limit for the Trading Sector in Stimulus Packages Has Been Increased

Bangladesh Bank issued BDT 20,000 crore stimulus package for CMSME concentrated on the manufacturing and service sector (70%). Only 20% of the loan was allocated for the trading sector. When the SP was introduced for the CMSME sector, it was noticed that a huge number of entrepreneurs are engaged in the trading sector. For this reason, a large portion of them remains outside the benefit from the stimulus package. In the 8th Financial Sector Development Working Committee meeting held on 8 August 2020, it is also recommended that as most cottage industries deal in wholesale and retail businesses, this distribution of SP can be reviewed. BUILD, in collaboration with SheTrade of ITC, has organised a Dialogue on Access of MSMEs and Women Entrepreneurs to Stimulus Package on 22 September 2020; a recommendation was placed where several representatives of CMSME and also the representative of Bangladesh Bank were present. According to SMESPD circular letter no. 12 of 28 October 2020, allocation of SP for CMSME Trading sector has been extended up to 30% from 20%.

Furthermore, BUILD Follow-up this issue on its several platforms. Recently, to increase the proportion of trading up to 35% as the disbursement for trading is high, Bangladesh Bank issued SMESPD Circular Letter no. 16 on 26 November 2020, where they instructed all banks and FIs to allow the limit up to 35% for the Trading Sector. This will be a great help for our present CMSME channel as those cannot be able to apply for the loan under SP due to the bar of trading in previous.

Time Extension for the Disbursement of BDT 20,000 Crore Stimulus Package Scheme for Working Capital for CMSMEs Affected by COVID-19

The private sector has been exposed to severe crisis because of the inauspicious hit by the COVID-19 pandemic. Especially cottage, micro and small enterprises are in the worst situation as they are suffering from a drop in sales, loss of income, unstable value chain and unprecedented shutdown. Bangladesh declared stimulus packages of BDT 20,000 crore with a 5% interest subsidy had been allocated for the benefit of Cottage, Micro, Small and Medium Enterprises (CMSMEs). The total reported disbursement of this stimulus package is BDT 5,882 crore till 6 October 2020. The total disbursement of this stimulus package is 29.41% so far, which is not very high. So, BUILD raised this concern to Bangladesh Bank and sent a letter to Bangladesh Bank to extend the time for the disbursement. Therefore, to realise the need, Bangladesh Bank issued a SMESPD Circular Letter no. 16 on 26 November 2020, where they also extend the time for the disbursement of stimulus packages for CMSMEs worth BDT 20,000 crore up to 31 December 2020. As the disbursement is not enough and from different platform and dialogue, BUILD came to know that many CMSMEs cannot get a loan from SP. Moreover, from one report of Bangladesh Bank, it has been seen that till 30 November 2020, the disbursement amount is only 49.71% which incurred BDT 8,215.44 crore. So, BUILD also pursue Bangladesh Bank to extend the time further for more implementation in December 2020.

Steps of Bangladesh Bank Towards Relaxing Foreign Exchange Regulations for Trade Transactions

Bangladesh Bank via FE Circular No. 49 on 18 November 2020 said that all exporters, irrespective of the sectors, will be allowed a maximum of 210 days to bring their export proceeds into the country due to the inauspicious impact in the wake of COVID-19. The extension will remain effective until March next year. In the earlier circular (FE Circular No. 30) published on 23 July 2020, only exporters of readymade garments and textile sectors were given the opportunity to avail the facility. In the 7th Financial Sector Development Working Committee (FSDWC) meeting of BUILD held on 7 August 2019, a study named ‘Financing Schemes and Available Credit Facilities for Export Competitiveness of Bangladesh’ was presented. The study focused on creating a level playing field for all the country’s exporters to strengthen the competitiveness of the export-oriented private sectors. In the study, BUILD suggested a specific recommendation to ease the trade process and assist the exporters through a stimulus package. Exporters have been facing problems in repatriating their export proceeds on time in the ongoing pandemic. Several foreign buyers reportedly become unable to make their payments against imported items from Bangladesh. The non-RMG exporters, as a result, are facing problems to realise the export proceeds. It is believed that the extension of the tenure of realisation of export proceeds up to March 2021 for all sectors will help the exporters of the country to revive amid the COVID-19 induced crisis.

Reforms in


Bangladesh Bank Rewarded Good Borrowers

The Bangladesh Bank has recently issued an order for offering incentives to its good borrowers in compliance, for which BUILD placed a proposal in the 6th Financial Sector Development Working Committee chaired by the Deputy Governor of BB. BUILD hails this move of the central bank as it will buoy up the borrowers to be regular with their loan repayment.

As the earlier instruction for giving rebates to good borrowers did not ensure good results, on 16 May 2019, the Bangladesh Bank has reissued incentives for good borrowers, meaning the banks will give good borrowers a 10 per cent rebate from total interests on their loans now.

This initiative of the central bank is well appreciated and helpful to those who are trying to be good loan takers. We think this type of incentives of the government should be more public, and in this regard, the banks may pass this information of rebates to their borrowers.

Approval of BDT 100 Crore Paid-Up Capital for Foreign Investors

All limited companies were required to take permission from the commission to increase their paid-up capital to above BDT 10 crore. The existing process of taking permission from BSEC and Registrar of Joint Stock Companies and Firms was cumbersome and time-consuming. Foreign investors are facing several problems and hassle in this process. Hence, at the request of foreign investors, the “Working Group on Improvement of Investment Climate” committee was formed at PMO.

BUILD worked on this issue and placed this study “Simplification of Policies for Raising Paid-up Capital for Foreign Investors” in the second meeting of the “Working Group on Improvement of Investment Climate” at the Prime Minister’s Office (PMO) on 20th April 2017, where BUILD proposed that Ministry of Commerce may issue a letter to BSEC to implement a rule that the foreign investors may get an exemption to take permission from the BSEC to raise paid-up capital up to BDT 40 crore provided their accounts are audited by internationally reputed and accepted audit firm. All recommendations were also placed in the 9th Meeting of the Private Sector Development Policy Coordination Committee (PSDPCC) at the Prime Minister’s Office (PMO) on 28th August 2018. From the meeting decision, a committee was formed under the chairmanship of Executive Chairman, BIDA, and a meeting was held on 8th May 2018 where the committee proposed BDT 100 Core for both Foreign and Joint venture.

Based on the above decision, recently, BSEC exempted wholly foreign-owned companies from taking the permission from the commission for hiking paid-up capital up to BDT 100 crore, subject to submission of the encashment certificate of such capital and payment of applicable fees to the commission on 28 November 2018.

Simplification of Sample Export and Import Policy to Increase the Export of Non-Traditional Sectors of Bangladesh

BUILD took the initiative to conduct a study to place some recommendations to PMO and Ministry of Commerce, like the inclusion of the definition of sample items, an increase of yearly value ceiling/maximum amount of sample to be imported, increase of De Minimis value, recommendations for BSTI as well as the procedural simplification to ensure the simplicity of sample import and export process.

BUILD’s recommendation of the study was to raise De Minimis Value up to USD 40. In that context, the government has raised the De Minimis Value to BDT 2,000 (USD 24) in the Customs Act, 2018 (reference: Chapter 6, Section 26, Subsection 1 (b), Customs Act 2018), which was only BDT 1000 (USD 12) as per the Customs Act 1969. This is one of the partial implementations due to BUILD advocacy.

As per another recommendation of this study of BUILD, Bangladesh Standards and Testing Institution (BSTI) takes the initiative to sign MoU with the concerned governments to simplify export and import of 33 accredited it.

BUILD placed some other recommendations through the study titled “simplification of sample import policy and procedure” to be reflected in the upcoming “Import Policy Order 2018-21”. Ministry of Commerce informed BUILD that they would consider these recommendations to be accommodated in the upcoming Import Policy Order 2018-21.

Reforms in


SD Imposed on Plastic/Polythene Bags at Distribution Level

Considering the issue of protecting environmental pollution and limit the use of hazardous plastic products, BUILD proposed the introduction of Supplementary Duty (SD) on single-use of plastic/poly bags at the distribution level in the Budget Proposal 2018-19.

A Gazette/Order has been issued on 7 June 2018 (File No.: 08.01.0000. concerning VAT and SD management issue of 2018-19 Fiscal Year where 5% SD has been imposed on all concerned products under 39.23 HS Code. These are all poly bags made of polyethene, plastic bags (woven) and other packaging materials.

SD has been imposed at the local level, which would make the poly bags a bit costly. In the world, every year, 500 billion polybags are used. From the sources of information in the concerned associations, about 200 factories in operation produce 50,000 polybags daily, meaning that 3.65 billion poly bags are produced annually.

Now, single-use poly bags may be reduced to at least 1% (36.5 million) annually. New opportunities which are environmentally friendly such as bags made of paper and jute, will be opened in the future.

Foreign Investment in Alternative Investment Funds Under NITA Allowed

The foreign fund is allowed under Bangladesh Securities and Exchange Commission (Alternative Investment) Rules, 2015. However, venture capital and fund management organisations and investors have been facing problems for allowing foreign fund in alternative investment because of the absence of a proper financing channel. The alternative investment fund is not associated with exchange or listed in exchange as per the policy. Foreign investors are allowed to open NITA account with the AD of the foreign currency department, but there is no specific direction from Bangladesh Bank (BB) for allowing non-resident or foreign investors to make investments in alternative investment funds as per BSEC (Alternative Investment) Rules, 2015.

BUILD prepared a Reform Policy Paper (RPP) on SME Financing and New Alternative Investment Rules where BUILD proposed some recommendations regarding some policy measures for the SMEs to get the benefits from the present BSEC (Alternative Investment) Rules 2015. One of the key proposals of BUILD was “NITA account holders may be allowed for investing in the VC firm if agreed by BB, and they fulfil the BSEC requirements”. To advocate these issues, BUILD placed those recommendations through its 6th Financial Sector Development Working Committee (FSDWC) meeting on 4 June 2017, at Bangladesh Bank, which is co-chaired by the Deputy Governor, BB and President DCCI.

Bangladesh Bank issued FEID Circular no. 02 on 30 July 2017, where Chapter 9 of the Guidelines for Foreign Exchange Transactions-2018, Vol-1 outlines operational procedures for non-resident investors to make direct and portfolio investment in Bangladesh. Now, foreign investment in Alternative Investment Funds (AIF) registered under Bangladesh Securities and Exchange Commission (Alternative Investment) Rules, 2015 is allowed through Non-resident Investor’s Taka Account (NITA), while the ADs need to follow some specific instructions mentioned in the circular.

Cold Storage Now in "Green" Category

The government has recently included cold storage in the ‘Green Category’ under the Bangladesh Environment Conservation Act, Clause 20. (Source: SRO No 349 Law/2017 dated 21 December 2017 by the Ministry of Environment and Forests). Having reviewed the guideline, this policy reform came into force following the recommendation of BUILD at the 5th Private Sector Development Policy Coordination Committee Meeting at the Prime Minister’s Office.

BUILD CEO Ferdaus Ara Begum hails this effort of the Ministry of Environment and Forests and the Department of Environment that enables the sector’s entrepreneurs to contribute more to the country’s agri-business economy. Bangladesh has limited post-harvest storage infrastructure such as Cold Storages (current capacity 2.4 million MT in 393 cold storages all over the country against the demand of 4.5 million MT). The shortage contributes to 40% post-harvest losses worth USD 430 million a year- borne mainly by the farmers, also discouraging processors from investment (valued at USD 64 million). In comparison, Bangladesh needs at least 6.5 million MT or 1,244 cold storages to strive to reach 10% cold storage infrastructure by 2022 (IFC Study).

Previously cold storage was under the “Orange B” category of the Environment Policy 1992 and Environment Conservations Act 1995, Environment Conservation Rules 1997 and Environment Court Act 2000. Cold storages used to require 13 different licenses, permits, and clearances to set up and operate, including an Environmental Clearance Certificate that also required Feasibility study of cold storage, Initial Environmental Examination including process flow diagram and Pollution minimisation plan including an emergency plan for adverse environmental impact. As well as cold storages, CNG/Autogas filling, solar power centre, bio fertiliser, LPG bottling plant have also come under the “Green” category.

Policy Reform by BUILD for 2018-19 Through National Budget

BUILD has proposed some specific proposals for accelerating the investment growth and promoting targeted private sector development as a budget proposal for 2018-19. The proposals (102) were placed with analysed findings from different research conducted by BUILD’s five working committees.

Among the placed proposals, fifteen were agreed and implemented through the recent budget for 2018-19; reforms are: revision of clause 30(h) of ITO 1984 in regard to giving relief to new industries for repatriation; corporate Income Tax on publicly and non-publicly traded banks was reduced to 37.5% and 40% consecutively; in case of widening tax network virtual business; and online advertising platforms have been incorporated in existing VAT law; to promote manufacturing in Bangladesh it has agreed to exempt VAT on local motorcycle and parts manufacturers; a separate HS code has been announced for “Open Cell” which will simplify the import of Television component and raw materials, VAT was exempted on coriander seed at import stage; duty on UPS has been increased to protect the industry, in case of sustainability and safety issue the duty on hybrid and Electric cars duty reduction, inclusion of “seamless pipe” in duty exemption list, imposing supplementary duty on single-use polythene bags are notable to mention.

Implementation of SME Financing Reforms

As per the Master Circular of SMESPD, Bangladesh Bank (paragraph 2.3), the minimum SME financing portfolio for the manufacturing sector is 15% for the service sector and a minimum of 55% for trade. BUILD proposed for enhancement of financing limit for the manufacturing SMEs and reduce limit for trading SMEs. Accordingly, the allocation for manufacturing SMEs has been increased from earlier 30% to 40%, and for trading, it has been reduced to 35% from the earlier 55%.

The SMESPED Circular no. 3; dated 29 June 2017, reflected the reforms as follows: by 2021, to finance the sustainable SME sector, a minimum of 40% to the manufacturing, a minimum of 25% to the service sector, and a minimum of 35% have to be provided to trade. The Women SME entrepreneurs do not get enough necessary financing. BUILD pleaded for increasing allocation for financing for SME Women Entrepreneurs (WEs). Accordingly, the above circular has increased the financing portfolio for SME WEs to 15% from the earlier level of 10% to be effective from 2021.

The SMESPED Circular no. 3; dated 29 June 2017, reflected the following reform:
10% of the total SME financing portfolio has to be provided to women entrepreneurs, and by 2021 it has to be increased to 15%. To bring mobility in the cottage, micro, small and medium sector, BUILD proposed reforms to increase facilities for SME WEs. The SMESPD Master Circular no. 1, dated 7 January 2016, mentioned a refinancing scheme for WEs.

BUILD recommended that up to BDT 25 lacs be lent to women entrepreneurs as a collateral-free loan. Accordingly, SMESPD Circular no. 1, dated 2 April 2017, reflected the following reform: Under the Refinancing Scheme of Bangladesh Bank, up to BDT 25 lacs will be provided as collateral-free loan considering their personal guarantee as collateral.

Allocation of SME Loan and Manufacturing Portfolio Increased

At the 8th meeting of the Private Sector Development Policy Coordination Committee (PSDPCC) at PMO on 13 January 2016, which the Principal Secretary, PMO, co-chaired, BUILD presented a reform policy paper on “Simplification of Financing Policies for Women Entrepreneurs”. In the meeting, BUILD proposed a specific recommendation on the refinancing scheme: a significant percentage of loans should be earmarked for the financing of manufacturing WEs. This proposal was also reviewed in the Review Meeting of Financial Sector Development Working Committee (FSDWC) Meeting on 27 August 2017, which was co-chaired by Deputy Governor, Bangladesh Bank. According to the decision of that meeting, a circular will be issued.

In this respect, Bangladesh Bank issued a circular (SMESPED Circular no. 3 on 29 June 2017. As per the issued circular, the allocation of SME finance has to be increased up to 25% with 1% increase per year. The allocation of the SME loan portfolio will be a minimum of 40% for manufacturing, a minimum of 25% for service and a minimum of 35% for business (trading) in 2021.

Bangladesh Bank Published Guidelines for FE Transactions

In the 6th Private Sector Development Policy Coordination Committee (PSDPCC), at PMO on 9 December 2014, which the Principal Secretary, PMO, co-chaired, BUILD proposed some recommendation to revise the Foreign Exchange Guideline 2009 and again in 9th PSDPCC meeting on 27 August 2017. Bangladesh Bank informed the committee that this guideline would be published soon, so there was a decision to publish the revised Foreign Exchange Guideline online.

To advocate these issues, BUILD placed those recommendations on the last three PSDPCC meetings and also the review meeting of the Financial Sector Development working Committee on 19 October 2016. BUILD also proposed some specific recommendations, some of which are implemented in regard to Value Addition, EDF and Supplier’s Credit Report. Presently in FE Circular no. 08 on 4 March 2018, Bangladesh Bank has changed and circulated the Guidelines for Foreign Exchange Transactions, 2018, Volume 1 and 2 on the Bangladesh Bank website.

Reforms in


Simplification of the Policies for Repatriation

At the 9th meeting of the Private Sector Development Policy Coordination Committee (PSDPCC) at PMO on 28 August 2017, which was co-chaired by the Principal Secretary, PMO, BUILD presented a reform policy paper on “Simplification of the Policies for Repatriation”. In the meeting, BUILD proposed a specific definition of “domicile”. That is, the word “domicile” would need to be rephrased.

Foreign Exchange Policy Department, Bangladesh Bank issued a circular (FE Circular no. 40) on 15 November 2017. As per the issued circular, (1) foreign nationals who are resident in and have income in Bangladesh are permitted to make monthly remittances to the country of their domicile out of their current savings up to 75% of their net income to cover their commitments abroad, and (2) it has now been decided that besides their country of domicile, such monthly remittances may be sent to other countries where family members of them live in as declared by them in the prescribed application form.

Reform for Boiler Production

BUILD proposed the removal of the requirement of renewal of the approval of the drawing and design of a boiler for continued production of the same article. Renewal of approval at regular intervals is time-consuming and hampers the production process. Getting approval from the Boiler Board in the Ministry of Industries takes about a month. Hence, removal of the requirement of renewing approvals would save time and cost for the entrepreneurs. The current provision requires securing approval every time, even if the design and drawing are precisely the same. The issue was raised in the working committee meeting of SME Development co-chaired by the Secretary of Ministry of Industries and referred to the Private Sector Development Policy Coordination Committee. In the 9th PSDPCC meeting, the issue was discussed elaborately, and instructions were given to the chief of the Boiler Board.

The issue was again discussed in an exclusive meeting at the Boiler Office in the presence of the concerned sectoral entrepreneurs. It was then decided that if an entrepreneur agrees to provide more than one maker’s number in the drawing and design and willing to submit examination fees separately for the production each time, then the approved drawing design could be used for repeated production of Boilers. In order to establish a Boiler Association, the office agreed to provide advice – according to another proposal by BUILD.

Bangladesh Bank has a policy for providing cash subsidy/cash incentives for different export-oriented products. Diversified jute products are one of the products that enjoy these benefits. However, for diversified jute products, there was a condition of the contribution of Jute of 75% (FE Circular no. 8, dated 1 July 2015). BUILD proposed that the government reduce the percentage from 75% to 40%-50%. The government has implemented the provision and enacted Jute Act 2017. As per the provision of the Act, the jute goods producers will be qualified to get a cash subsidy by ensuring 50% of jute elements in the produced jute goods.

Besides, as per FE Circular no. 19, dated 16 November 1998 and FE Circular no. 22, dated 3 December 2000, diversified jute goods producers, such as Espadrill, would need to be qualified to have a jute mill. For having this, they also need to be a member of the Bangladesh Jute Mills Association (BJMA). As per the requirement of getting membership of the association, producers of Espadrill would need to have 40 breading machines for preparing shoe soles made of jute yarn. Given that the private sector was facing tremendous problem while these jute goods have tremendous export scope abroad. The government has now decided that upon getting a certificate from JDPC, the exporters will proceed for exporting diversified jute goods and would be qualified to get a cash subsidy.

Presently for approval of a design of a specific configuration of a boiler, the entrepreneur has to get permission for each time. BUILD proposed that the concerned ministry provides an exemption to the boiler producer from taking permission to produce more than one boiler from the same design. The government has now decided to get approval at the time of producing repeated boiler of the same design from the Boiler Office. BUILD also proposed allowing more inspection agencies in the inspection list to reduce inspection time from the entrepreneurs. The Boiler Office is now going to revise the inspection list for supporting the private sector so that it does not take so much time to get the inspection issues done within a specific time frame.

BUILD's Reform Initiatives for 2017-18

BUILD proposed rationalising the corporate Income Tax at 10% from the announced rate of 14% on “Green Industry” in the budget for FY2017-18. The government has decided to reduce the CIT for Green Industrial establishment to 10%, which is aligned to SDG 12(Sustainable Consumption and Production). Incentivization of the green factory would reduce the industrial footprint to climate change and help to step ahead towards the global agenda 2030by United Nation.

BUILD suggested including foreign workers in a tax network of Bangladesh. It has been announced in the Finance Act 2017 that each and every foreign national has to pay 30% income tax against their annual income. As a result, around 5 lac foreign nationals would be in the income tax network in the upcoming fiscal year, and USD 150 million revenue would be added to the revenue volume.

Guidelines for Audit

BUILD prepared and presented a study on “simplification of audit policy (income tax)” in the 2nd TWC meeting on 3rd February 2016 at NBR. In that meeting, BUILD proposed a detailed Guideline with all related information for the taxpayers to prepare fully not to face Audit, which is creating hassles for running their businesses. In responses, NBR informed there is a guideline for audit used by the allied department of NBR but for the taxpayers as such, there are no public guidelines.

On 19th February 2017, the audit intelligence investigation unit of NBR has prepared a guideline as per ITO 1984, section 82BB (1) and in case of return submission 82BB (3) for 2016-17. This Guideline will be helpful for the taxpayers. BUILD also requested publishing the tax audit guideline through the website of NBR.

Risk-Based Auditing

Similarly, in the case of desk-based auditing, a circular was made on 1st December 2016 for the commissioners to handle the desk-based process as per ITO 1984, 82BB (2) for 2016-17. BUILD recommended a risk-based audit system so that taxpayers were not harassed for paying taxes.

It was decided that a risk-based audit system could be introduced with some criteria which are in the process after full automation of the taxation system by July 2017 with the announcement of the National Budget.

ERQ Increased up to USD 25,000

A string of proposals for simplifying foreign exchange policies for the pharmaceutical sector in Bangladesh were presented at the 3rd Financial Sector Development Working Committee meeting in 2014. Bangladesh Bank agreed to implement some of the recommendations placed in the meeting.

Recently, by announcing a circular (FE Circular No. 05, dated 05 February 2017), Bangladesh Bank has decided to enhance the limit of advance payment from Export Retention Quota (ERQ) up to USD 25,000 or its equivalent from USD 10,000. This is a significant step implemented by the Bangladesh Bank, which will help this sector grow.

It is also noteworthy that on 27 May 2015, Bangladesh Bank had also announced a circular (FE circular no. 05) in which ERQ for exports of high domestic value-added merchandise has been increased to 60 per cent from the existing 50 per cent, while the ERQ for merchandise exports of high import contents (like apparels using woven fabric) has been raised to 15 per cent from 10 per cent.

Separate Economic Zone for Women Entrepreneurs

Many women entrepreneurs in the country want to expand their business, but due to lack of land, they cannot. For that reason, a proposal on “Requirements for Separate Economic Zone (EZ) for Women Entrepreneurs (WE)” was presented in the 8th PSDPCC meeting at PMO held on January 13, 2016. To implement the decision of the 8th PSDPCC meeting, recently, BEZA decided to allocate 100-acre land for women entrepreneurs at Mirsarai Economic Zone, Chittagong. In that respect, BEZA will make an agreement with relevant organizations.

Reforms in


Trade License Fee Reduced

The trade license collection fee and registration fee were increased on March 2, 2015, as per SRO no. 44/Act/2015 for doing business in city corporation areas. Trade license fees were increased exorbitantly, e.g., the rise of fees for any confectionary or any fast-food shop in Dhaka city increased to BDT 2,000 and BDT 4,000 from BDT 300 of 2002 (SRO no. 295/Act/2002/Powro-1/2M-04/2002). The business stopped renewing licenses because of the increase in fees. On 31st January at last, the local government ministry decided to reduce the trade license fees and accordingly issued an SRO (no. 13 Act 2016) revising the fees. The businesses can now get licences or renew licences at a reduced rate. Worth mentioning that this issue was raised in the 7th PSDPCC meeting at PMO, and BUILD initiated a study. Now it has been implemented.

Minimum Tax Reduced

As per Income Tax Ordinance 1984 (16 CCC), imposition of minimum tax is allowed based on company classification of firms. Irrespective of profit and loss, the minimum tax rate at the rate of 0.03% is to be paid by those companies earning more than BDT 50 lacs. In 2015-16, a new provision was included to reduce the tax rate further to 0.10% for those who are engaged in manufacturing industries for at least three years. BUILD conducted a study on “Charge of Minimum Tax (Turnover Tax) according to the ITO 1984” in 2013 and proposed some reforms.

Simplification of Financing Policies for Women Entrepreneurs

A proposal on “Simplification of Financing Policies for Women Entrepreneurs” was presented in the 4th SME Development Working Committee Meeting and 8th PSDPCC meeting at PMO. Ministry of Industries and Bangladesh Bank has agreed to all the recommendations placed in the meeting. A definition of Women Entrepreneurs was included in the Industrial Policy 2016. Bangladesh Bank issued a fresh circular allowing the collateral-free loan to the amount of BDT 25 lac for women entrepreneurs on 7 January 2016.

High Priorities Sectors in the National Industrial Policy 2016

Based on the impact of trade, jobs, demand, the country’s endowments and investment outlook, BUILD initiated the study to identify high-priority sectors from the list of the 32 thrust sectors included in the National Industrial Policy 2010 so that those sectors with the highest potential receive proper policy attention. The reform paper was presented in the 2nd PSDPCC meeting held on 26 July 2012. The SME cell of the Ministry of Industries (reference letter of January 27, 2013) informed that these sectors are to be included in the NIP 2016. In the NIP 2016, these sectors have been included as high-priority sectors, and some policy incentives have also been arranged to develop these sectors.

Importance of International Commercial Terms (Incoterms)

A proposal on “Import Policy Regime: Business to Bangladesh” was presented in the 4th Trade and Investment Working Committee and 6th PSDPCC meeting at PMO. The Ministry of Commerce has agreed to all the recommendations placed in the meeting. One of the proposals was the maintenance of the Incoterms by importers and ADs to be mandated through policy. It is crucial for complying with the Trade Facilitation Agreement at the 9th WTO Ministerial Meeting in Bali. The government has included “import through Incoterms” in the Import Policy 2015-18 (Chapter 2, Clause 5).

ADR Resolving Time Reduced

In recent time, ADR is getting popular, and a number of cases are being resolved through the ADR process. A study on Alternative Dispute Resolution-Implementation and Policies’ was presented at the 2nd Taxation Working Committee Meeting of BUILD. BUILD proposed reducing the time frame of resolving ADR cases. The Finance Act 2016 has reduced the time from 60 to 50 days now. This policy will help business entrepreneurs to get more and quick services from ADR.

Taxpayer's Time to Respond to the Notice Increased

In the present policy, a taxpayer needs to apply for ADR within ten working days if any judgment, show cause requirement related notice and price fixation as per Clause 5 is not in his/her favour. The time has been now increased to 20 days, which will help the applicant be ready to make a final decision. BUILD proposed these changes through its study on alternative dispute resolution implementation and policies and presented at the NBR.

Tax Policy Reform Implementation

BUILD prepared a study on Simplification of Tax Policy for the electrical and electronics sector and presented in its Taxation Working Committee meeting for rationalizing tax policy and addressing hassles for importing raw materials, and maintaining standard and quality issues for some selected electrical and electronic products. NBR accepted a significant number of proposals for this study.

As per proposals of BUILD to support domestic 10-120 MVA transformer manufacturers (HS code 8504.23.90), the import duty has been increased from earlier 5% to 10%. This will help domestic manufacturers to be self-sufficient in supplying the transformer at the domestic level and increase export.

About 5-6 domestic UPS manufacturers are operating in the country, but a significant amount of raw material is required to be imported from overseas, of which motherboard is a significant one for UPS.NBR has agreed to reduce the duty on the motherboard accessories imported under a single HS Code from the present level of 25% to 10%.

Optical fibre cable is one of the sectors growing faster. Bangladesh is almost self-sufficient in producing this product. However, a number of raw materials used for this sector are imported, such as polyester tape (HS code 3919.10.00), jelly compound (HS code 3824.90.90). NBR considers duty reduction of these raw materials that are not produced in the country to support this sector.

Reform Implementation of ADR

A study on “Alternative Dispute Resolution-Implementation and Policies” was presented at the 2nd Taxation Working Committee Meeting of BUILD. BUILD proposed reducing the time frame of resolving ADR cases. ADR resolving timeline has been reduced to 0 days from 60 days (SRO no. 53-AIN/2012/632/VAT). For applying against any notice, the time duration for the applicant is 20 working days now instead of 10 working days (SRO no. 53-AIN/2012/632/VAT). BUILD proposed for enhancement of time for getting the applicant ready to reply to the notice.

Reform Implementation of Tax Policies

BUILD placed few issues regarding overhead costs of establishing branch offices for Banks through its 4th Financial Sector Development Working Committee (FSDWC) Meeting held on 29 December 2014, and in response, Bangladesh Bank revised the issues and brought the following changes. The maximum space criterion has been extended to 6000 sqft from 5000 sqft for the urban branches vide BRPD Circular Letter no. 09, dated 26 July 2016.

The maximum space criterion has been extended to 3000 sqft from 2000 sqft for the rural branches vide BRPD Circular Letter no. 09, dated 26 July 2016. Maximum expenses other than IT for branch set up was at BDT 1500/sqft for moving existing branch, and the amount was set at BD 1000/sqft vide BRPD Circular Letter no. 01, dated 16 January 2014. Analysing the market data, BB still thinks the current limit should remain unchanged. BB will continue to keep an eye on this issue and modify the limits as and when they felt necessary.

Tax on Vehicle Registration

BUILD placed an issue regarding a specific law to collect tax on vehicle registration in Income Tax Ordinance (ITO) 1984 (presently it is done by issuing an SRO every year) through its Budget Proposals by Taxation Working Committee (TWC). In response, NBR approved the issues, and by the Finance Act 2016, they inserted a new section 68 B in the ITO 1984 regarding advanced tax for the owner of the private motor car.

Trademark Registration for SMEs in Bangladesh

A proposal for Trademark Registration for SMEs in Bangladesh was presented in the 4th SME Development Working Committee. The Ministry of Industries agreed to implement the recommendations placed in the meeting. Some significant recommendations included the inclusion of service mark rules in the new Trademark Rules 2015 and journal publication through the DPDT website. The government has already incorporated service mark in the new Trademark Rules 2015 and journal publication through the DPDT website.

Reforms in


ERQ Quota Enhanced

Following the BUILD proposal placed at the 5th Private Sector Development Policy Coordination Committee at PMO, the Foreign Exchange Policy Department of Bangladesh Bank has enhanced the Exporter’s Retention Quota (ERQ) on 27th May 2015. BB revised its section IV, chapter 13 of the Guidelines for Foreign Exchange Transactions 2009 (GFET), which permits exporters to retain specified parts of their export earnings in foreign exchange.

Exporters use ERQ for business expenses, including maintenance of offices abroad, fair participation and promotional activities. The RMG and pharmaceutical companies are the genuine beneficiaries of the ERQ to increase their exports.

Corporate Income Tax Reduced

BUILD set out a proposal to reduce CIT to NBR. Following the proposal, the government in the budget agreed that the CIT difference between publicly and non-publicly traded companies would be 10%. In the last fiscal year, the non-publicly traded company’s rate has been reduced to 2.5% to maintain a 10% difference; the publicly traded company should be allowed to pay 25%.

Environmental Clearance Certificate for Cold Storage

BUILD set out a recommendation at the 5th PSDPCC meeting to review the guideline and industry category for environmental risk and include Cold storages in the “Green” and “Orange A” category instead of the existing “Orange B”. Department of Environment under the Ministry of Environment has already reviewed and accepted the proposal. Now Cold Storages Industry belongs to “Komla Ka”/”Orange A” instead of “Komla Kha”/”Orange B” in the classification made for obtaining an Environmental Clearance Certificate. However, the private sector believes cold storages should be in the “Green” category, and the 7th PSDPCC requested examination of the possibility for re-classification of this sector to the Green category.

GSP Automation System Expanded to Non-RMG

A study presented in the 4th Trade and the investment Working Committee and placed in the 6th PSDPCC meeting requested to extend the benefits of the automated GSP certificate for both RMG and non-RMG sector and to the non-EU country as well. As a result, the Export Promotion Bureau (EPB) extends its GSP automation services beyond Dhaka so that more exporters can enjoy these benefits. Automated software for GSP supported by the EU is in practice since January 2015 to make business more accountable and transparent and enable the exporters to enjoy speedy access to the automated GSP System.

List of Registered Factory Names Now on DIFE Website

BUILD conducted research to simplify the Factory plan approval procedure for the Department of Inspection for Factories and Establishments (DIFE) and presented it to the third Private Sector Development Policy Coordination Committee (PSDPCC). BUILD proposed for the expansion of this department, graduation to a Directorate and the virtual platform establishment to accomplish tasks conveniently. DIFE has been graduated to a Directorate. It has recently established a website ( to provide stakeholders with important information on acts, rules, inspection procedure, sectoral information of industries, contact information and current activities.

VAT Exempted Limit Extended

BUILD submitted budget proposals on VAT, Income Tax and customs to NBR. Among the given proposals, Turnover TAX, local procurement and simplification of drawback system are significant considering the economic impact. Proposals made by BUILD for the turnover tax module can ensure that Eligible SMEs and Cottage Industries can avail Turnover Tax benefits. FBCCI submitted some proposals to NBR, which their standing committee validates. One of the proposals is that the VAT exempted limit should be increased from 24 lacs to 36 lacs that BUILD endorsed and included in its Budget proposals for 2015-16. The government accepted the proposals which were announced in the budget.

Reforms in


No Permission Required from Central Bank for ATM Booths

Banks need not Bangladesh Bank’s prior permission for setting up ATM booths. In response to the circular (no. 18 issued on 19 November 2012) of Bangladesh Regulation and Policy Department (BRPD), Bangladesh Bank issued a circular (letter no. 2) on 13th January 2015. The circular said all scheduled banks would require their respective boards’ approval meeting the expenses of rent and booth installation cost. This proposal was placed by BUILD through its Financial Sector Development Working Committee.

Several reform updates were received at the 6th Private Sector Development Policy Coordination Committee (PSDPCC) Meeting held on 9 December 2014 at PMO. Bangladesh Bank, DIFE (Department of Inspection Financial Establishment) of MOLE (Ministry of Labour and Employment) and NBR sent their updates in writing in response to the reform proposals suggested by BUILD at the 4th and 5th PSDPCC meeting. The updates are as follows:

Bangladesh Bank will issue a new EDF Master Circular shortly to address the changes made so far so that the exporters can acquire all the updated information for availing Export Development Fund (EDF).

The subsequent amendment of Guidelines for Foreign Exchange Transaction (GFET) will include all the necessary information detailing value addition, eligibility criteria, and maximum limits. Bangladesh Bank will inform BUILD after the inclusion in the subsequent amendment. Bangladesh Bank will inform the stakeholders whenever the threshold of Export Retention Quota (ERQ) for payment of foreign exchange transaction will be revised from the present level of USD 10,000.

As per the request of the fifth Meeting of the PSDPCC, the Department of Inspection of Factories and Establishments (DIFE) has implemented several reforms, one of which is updating the website of the organization to post all related information of established companies.

Exporters use ERQ for business expenses, including maintenance of offices abroad, fair participation and promotional activities. The RMG and pharmaceutical companies are the genuine beneficiaries of the ERQ to increase their exports.

Obtaining an Ad Hoc IRC from BOI Just Got Easier

BUILD’s Trade and Investment Working Committee (TIWC) proposed recommendations to make the process of getting an ad hoc IRC easier and faster. So, the Board of Investment (BOI) has implemented BUILD’s recommendations through work orders based on BOI’s executive committee meeting decisions. As a result of this, significant improvements came into practice in the process of ad hoc IRC issuance. The overall issuance time has been reduced to just ten days from 34-63. This includes a seven-day reduction in inspection time and a further five-day reduction in internal proceedings.

Now applicants are also provided with a checklist with their application form to prepare themselves for inspections. Furthermore, the English version of the application form is now available on the BOI website. In addition to this, the regional entrepreneur will now have the information they need to apply for ad hoc IRC through regional BOI offices on the BOI website. BOI expects that the process would be fully automated by the end of this year, and delivery would become more efficient.

Separate Section in the Upcoming Export Policy for Deemed Export

To achieve optimum national growth through the increase and diversification of Export, BUILD conducted a study on Deemed Export in 2013. BUILD found that policy interventions can be made through minor revisions in the Export Policy. In order to ensure the legal entity of the deemed exporters, BUILD suggested that there should be a separate section in the Export Policy for deemed exports, which can also include the guidelines for deemed exporters backed with a government gazette notification.

Ministry of Commerce has approved this reform proposal by BUILD, and they have decided to include a separate chapter for deemed export in the upcoming Export policy. BUILD is now advocating for the other reforms proposed on the issues, which includes-increasing the Export Retention Quota to at least 15 per cent from the existing quota of 10 per cent for export of goods having high import content and extending the timeline to 90 days from the existing clause of 30 days, for the compulsory encashment of export proceeds other than back-to-back L/C.

CCI&E Simplified the Procedures for Export-Cum-Import

Office of the Chief Controller of Imports and Exports (CCI&E) simplified documentation requirements for export-cum-import. Earlier, eleven documents were required for export-cum-import, which has been reduced to only five now. This will reduce the hassle and cost of doing business.

Some Upcoming Process Simplification Through FEG

Bangladesh Bank will issue a new Master Circular shortly to address the changes in the circulars issued for EDF. So far, so that exporters can acquire all the updated information for availing EDF.

The following amendment of FEG will include all the necessary information, detailing value addition, eligibility criterion and maximum limits. Bangladesh Bank would also issue a circular whenever they allow the renewal fee payment from the exporters’ local currency account. Bangladesh Bank has in principle agreed to extend the ERQ Account amount from the present level of USD 10,000.

Reforms in


Credit Report Thresholds Go Up

Foreign Exchange Policy Department of Bangladesh Bank has recently raised the thresholds for confidential reports (supplier’s credit report in light of a BUILD study presented during its Financial Sector Development Working Committee on 11 April 2013). Collection of confidential reports on the exporter (foreign supplier) costs between USD 75-150 as per the latest Dun & Bradstreet (D&B) fees schedule. To reduce the cost burden on the local importers, it has been decided that Authorized Dealers (ADs) should obtain confidential reports of the exporters in all cases where the LC/contract exceeds USD 10,000 (earlier it was BDT 5 lac) in cases where proforma invoices are issued directly by foreign suppliers, and USD 20,000 (earlier it was BDT 10 lac) in cases where local agents of the foreign suppliers issue indents.

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