Amidst the complexities pertaining to loan payment and interest liability of the factories, the Commerce Ministry is reportedly figuring out ways to liquidate around 133 ailing apparel manufacturing units.
According to media reports, a tripartite committee consisting officials and members from the RMG sector, the central bank (Bangladesh Bank) and ministries has already been formed to evaluate possibilities of liquidation under a facility offered by the Government in this direction in the budget for the fiscal year 2013-2014.
As per reports, around 146 manufacturing entities have managed to liquidate their units availing the benefits but rest of the 133 factories, many of which are closed now, failed to do so.
Considering the existing scenario, the concerned ministry reportedly held a meeting on 5 October in which it was decided to examine reasons as to why the factories could not avail the benefits under which the Government has proposed loan write-off and waived interest facilities for a total of 279 units.
It may be mentioned here that the garment makers’ body, BGMEA (the Bangladesh Garment Manufacturers and Exporters Association) has called upon the Government to consider the role of the units in the apparel sector in the initial years of investment in the industry and demanded a bailout package waiving loans and interest for the sick factories, amounting to Taka 686 crore.
Following the BGMEA request, Finance Ministry’s Financial Institutions Division sought the opinion of the central bank on writing off the loans and interest of these factories, in reply to which the Bangladesh Bank has reportedly underlined that the Government would have to pay more than Taka 686 crore to the banks that provided loans to these 131 manufacturing units.
