The country’s businessmen are facing various problems in all sectors including trade and commerce and industry due to the ongoing fuel oil, gas and dollar crisis in the country.
Businesses said they can’t open a Letter of Credit (LC) at the banks to import machinery and raw materials for long days which created an acute crisis of the industrial elements in the factories. On the other hand, the production at the factories has decreased due to the lack of gas and electricity crisis. As a result, a stagnation situation prevails in the country’s trade and commerce. Many businessmen are supposed to go to loan defaulters in this situation.
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) President Md Jashim Uddin told Bangladesh Pratidin that there is no scope to increase the interest rate of the bank loan. If the central bank increases the interest rate, then businessmen and entrepreneurs will face more pressure.
He said the cost of importing raw materials, ship fare and transport costs have already increased due to the Russia-Ukraine war. In this situation if the bank increases the interest rate, then it will put serious pressure as production costs and business expenses will also increase. The situation is not suitable to face such additional pressure during the post-Covid-19 period. An increase in interest rate will create more loan defaulters, he feared.
The FBCCI president also said if production decreases due to the crisis of gas and power, bank customers will fail to pay loans which is a threat to the banks and entrepreneurs.
The government will have to generate coal-based electricity as an alternative solution during the Russia-Ukraine war. Besides, the fuel cost will have to be reduced by the collaboration of the government and private organisations. The cost will have to be reduced besides active banking service to resolve the ongoing dollar crisis, he opined.
Bangladesh Chamber of Industries (BCI) President Anwar-ul-Alam Chowdhury Parvez said the United States and the European Union are the main two markets for the readymade garment industry of Bangladesh. The fact is, inflation has risen in the USA and European countries due to the Russia-Ukraine war. So, they have reduced buying clothes as they spend more on food. That is why the export earnings of the country have decreased significantly and there is no hope to hear good news in this sector.
He said, “The amount of our foreign reserve is decreasing day by day. Now foreign reserve stands at $35 billion which was $48 billion last year. Export earnings and foreign remittance-this two indexes were running our economy. These two indexes have been shocked during the ongoing world economic crisis. The remittance flow has decreased compared to the export earnings. For this reason, our foreign reserve is decreasing continuously.”
Some more businessmen echoed their two top leaders saying their production costs increased and they are suffering from a serious fuel crisis due to the Russian invasion of Ukraine and its impact on the global economy.
Businesses said, at present around 25-40 per cent of production is stopped at their factories due to the gas crisis. The country’s industrial sector is going through a tough time. Policy support is needed to continue industrial production.
The balanced distribution of the dollar in internal resources, and the import of the most important and general products can play an important role to reduce the ongoing dollar crisis, they observed.
They also think the central bank should take stern actions against the culprit banks which are responsible for the dollar crisis.
@ The article was published on print and online versions of The Bangladesh Pratidin on November 6, 2022 and has been rewritten in English by Golam Rosul.
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