Bangladesh Bank Governor Ahsan H Mansur on Tuesday assured readymade garment (RMG) exporters of policy support and the expedited disbursement of outstanding export incentives to help the sector manage a liquidity crunch ahead of Eid-ul-Fitr.
The move is intended to assist factories in settling the wages and bonuses of millions of workers on time.
Mansur gave the assurance during an emergency meeting at the central bank’s headquarters with a delegation from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
The RMG representatives were led by BGMEA Senior Vice President Inamul Haq Khan and Vice President Md Shihabuddoja Chowdhury.
Industry in ‘deep crisis’
BGMEA officials described the ready-made garment sector, the nation’s primary source of export earnings, as being in the grip of a “deep crisis.”
They explained that the production cycle for February was reduced to just 19 effective working days, down from the usual 28, due to public holidays for the national election and Language Day. This contraction has severely disrupted shipment schedules.
The industry is further strained by sluggish international demand, falling product prices, and rising production costs, all exacerbated by global geopolitical instability.
With the shortened production window, factory owners face a “monumental challenge” in meeting their obligations for timely wage and Eid bonus payments.
Proposals for stability
To safeguard industrial stability and prevent potential labour unrest, the BGMEA submitted several proposals to the central bank.
The association urged the authorities to fast-track the release of approximately Tk5,700 crore in pending cash incentives for the 2025-26 fiscal year, which are currently stalled due to audit processes.
The BGMEA also requested that small and medium-sized (SME) factories receive preferential treatment during the disbursement of these funds to ensure their survival.
Additionally, the association sought a special wage-support loan facility equivalent to two months of salaries, proposing a three-month grace period and a 12-month repayment schedule.
Further requests included the reintroduction of Packing Credit at a 7 percent interest rate and an expansion of the Pre-shipment Credit Scheme from Tk5,000 crore to Tk10,000 crore, with the scheme’s tenure extended until 2030.
Central bank response
Governor Mansur acknowledged the urgency of the situation, stating that the central bank would take “positive steps” to address the liquidity shortage. He emphasised that prioritising cash incentive releases for SME factories would be a key focus.
Ensuring that workers are paid on time to maintain peace in critical industrial zones is a top priority for the central bank, the governor added.
This intervention highlights the central bank’s ongoing effort to balance financial discipline with the need to protect employment in Bangladesh’s most vital export industry amidst intensifying global market volatility.
