The entrepreneurs and businessmen, who took loans from banks, are seeking exemption from payment of interest till December as COVID-19 has taken a heavy toll on investors as trade and economic activities have stalled during the global pandemic.
If borrowers are not relieved of the burden of loan interest, many of them might face bankruptcy, they said.
Earlier, Bangladesh Bank (BB) asked the scheduled banks not to realise monthly loan interest from borrowers till June. But they will have to pay all the dues afterwards.
Businesses affected by the crisis said mere delaying the payment of installments is not enough and exemption from the interest till December is needed to save the entrepreneurs.
They said that the government should bear the loan interest for the period to save the businesses and industries --- the lifeline of the country’s economy.
Tapan Sengupta, deputy managing director of Bangladesh Steel Re-Rolling Mills Ltd (BSRM), said they have already sought some banking supports from the government.
“The government should provide loan interest waiver for a specific period. Without government support, entrepreneurs cannot survive this crisis” he said.
As businesses and trade remain stagnant and the impact of the coronavirus crisis is likely to continue in the coming months, banking support is a must for survival of this sector, he added.
Md Shahidulla, managing director of Metrocem Cement, thinks that the government should extend the loan classification facilities till December.
“We don’t have working capital right now. We have to pay salaries to employees although our production remains halted. In the wake of such an unprecedented situation in business caused by the coronavirus crisis, we need financial support like interest-free loans,” he said.
Md Shahidulla, also the vice-president of Bangladesh Cement Manufacturers Association, said cement and steel sector employs a large number of workers. Any negative impact on this sector will affect the entire economy.
Bangladesh Cement Manufacturers Association (BCMA) president Md Alamgir Kabir earlier in a statement sought policy support from the government, such as tax waiver and loan flexibility, to help the sector navigate this crisis.
Interest on the loans taken as working capital and for procuring project machinery is increasing at compounding rates, he mentioned.
Habibur Rahman, the owner of R Automobiles, also said they are heavily dependent on bank loans. In this situation, their businesses remain totally shut and the situation might remain sluggish for the next few years.
In this situation, the facilities given by central bank are required to be extended till December to save businesses, he said.
Rahman, also a former general secretary of Barvida, said they will also need bank loans at lower rates.
It has been learnt that the entrepreneurs spend a lion share of profit for paying salaries of the employees.
The government has succeeded in hiking literacy as educated youths are getting employed. The private sectors and corporate bodies have turned out to be a destination for lucrative jobs.
All leading business conglomerates and small and medium investors are facing a setback due to corona as business activities have come to a halt.
The traders, who seem to be unable to meet the operational costs, are overburdened with wages of the employees and loan installment.
Hundreds of thousands of people have lost jobs due to the closure of shopping malls and other business houses.
Despite all odds, many leading conglomerates and trading bodies are trying to protect the jobs of their employees. This is a good initiative from the part of local companies although a large number of companies abroad have reportedly gone for cost-cutting, experts said.
The government should stand by the affected businessmen to protect the livelihoods of crores of people dependent on different industrial sectors.
Bangladesh has made significant socio-economic progress during successive Awami League rules led by Prime Minister Sheikh Hasina.
The country has graduated from LDC status to developing one during this term. Bangladesh is ahead of many other South Asian countries including India in terms of GDP growth and per capita income.
Businessmen have a major contribution to the successes. The country has made a u-turn from bottomless basket due to the contribution of investors.
All success of the country will be marred and jeopardized if the economic sector doesn’t get policy support from the government during this crisis.
Source: daily sun
BDST: 1237 HRS, APR 25, 2020
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