Exports of 43 sectors to remain eligible

Bangladesh Bank (BB) yesterday announced that 43 products or sectors will be eligible for government stimulus or cash incentives against export receipts for the current fiscal year of 2023-24. 

The same products or sectors were named for the benefits last fiscal year. The incentives range from 1 percent to 20 percent, said a BB circular.

Incentives are paid to exporters for select sectors, mainly to give them encouragement and make them more competitive in international markets.

However, it will not be possible to continue direct cash incentives against export receipts once the country makes the United Nations status graduation from a least developed to a developing nation in November 2026.

This is due to a relevant bar on developing and developed countries, excluding the least developed countries (LDC), by World Trade Organisation (WTO), of which Bangladesh is a member.

As a result, the government has been devising strategies, as in alternatives to payment of direct cash incentives, to incentivise local exporters after the LDC graduation.

However, the government can continue the payment of direct cash incentives up to 2026 prior to the LDC graduation.

In the European Union (EU), the payment of cash subsidy against export receipts can continue up to 2029 as the EU will allow LDC benefits to graduating countries for three more years as a grace period.