Cash incentive lowered for exporters to prepare for post-LDC era

The government has cut the export subsidy for almost all sectors to reduce the pressures on Bangladesh's coffers and bring down rates gradually since the country can't provide such subsidies once it becomes a developing nation. 

In their immediate reactions, economists welcomed the move while exporters expressed sheer disappointment. 

Bangladesh used to give cash assistance ranging from 1 percent to 20 percent on export earnings in order to encourage exporters and make them more competitive in international markets, thus raising the income from the biggest foreign currency earning sector of the country.

Now, the maximum rate has been set at 15 percent and the minimum at 0.5 percent and it would be applicable for January 1 to June 30 this year, the central bank said in a notice today.