Old Dhaka’s small businesses demand speedy disbursement of stimulus funds

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Businesses in Out of date Dhaka yesterday demanded speedy disbursement of the government-announced stimulus bundle for cottage, micro, little and moderate enterprises (CMSMEs).

These entities, a large number of which are found in Old Dhaka, have been struggling to survive in being badly impacted amid the Covid-19 fallouts.

The require came at a virtual appointment organised by the Dhaka Chamber of Commerce and Industry (DCCI) on the existing situation of Old Dhaka's businesses.

Some 13 million CMSMEs take into account 25 % of Bangladesh's GDP and 35.5 % of total employment, explained Shams Mahmud, the DCCI president, while moderating the function.

Their contribution to export revenue also range between 75 per cent to 80 % but the sector has been hit hard by the pandemic while banks are reluctant to disburse loans from the stimulus package.

The CMSMEs sometimes face challenges in usage of finance, marketplace linkage, product standardisation, modern tools and training and for too little skilled manpower, according to a statement from the DCCI.

Small entrepreneurs even now want to pay VAT and tax nonetheless they want to avail instalment facility to cope with losses, said Mahmud. "Moreover, we need to learn alternative sources of funding besides banks," he stated.

The DCCI plans to sit with the banks to try to find out the procedures SMEs have to take to qualify for loans from the stimulus package, informed Mahmud.

He also urged the federal government to announce 2021 due to the entire year of the CMSMEs sector. "You want to arrive out of this example. We are in need of SME linked FDI plans to create CMSME sector grow even more," he added.

Small enterprises get together to create a major conglomerate and large companies are mostly reliant on SMEs, said Hossain Khaled, managing director of the Anwar Band of Industries.

"We must create employment opportunities as it is usually the key concern now in a country like Bangladesh. As a result of Covid-19 pandemic our product sales attended down by 35 %, that will have negative ripple effects," he said.

Unbanked SMEs might not be able to take advantage of the stimulus, that is a challenge, this individual said. "We must bring the unbanked entrepreneurs in the banking channel," he added.

Terming Out of date Dhaka the centre of business, he said lowering the cost of carrying out business was necessary for survival at the moment. Making 25 % of the government's e-procurements from CMSMEs ought to be built mandatory, he emphasised.

"Our making sector is more often than not import based, Khaled said, underscoring the necessity for easing complex procedures of import.

During this crisis, SME Base now should be more vigorous and Bangladesh Bank can present a refinancing scheme with a 1.5 per cent to 2 % interest for the SME sector, he said.

"We were not in a position to sell any product during this time period of pandemic," stated Md Alauddin Malik, president of Regional Garments Manufacturers Association.

"This sector offers been struck hard. We are as well not getting satisfactory support from banking institutions to get loan from the stimulus bundle." Dyeing and embroidery traders are associated with this sector therefore they also need school funding, he said.

Due to unbearable traffic congestion, Aged Dhaka is certainly losing customers daily, he added, requesting to make shops remain open up till 8:00pm rather than 7:00pm.

There are 120 commercial units in Keraniganj BSCIC commercial area and closures prompted many employees to go home, most of whom are however another, said Hossain A Sikder, president of Dhaka Shilpa Malik Samity.

Some 80 % of export-oriented industrial devices in the BSCIC area are closed because of too little demand, he said.

Additionally returnee migrants will set strain on the existing unemployed workforce. At this time, economical support from the banking institutions will help simplicity the crisis, he added.

Md Abdur Razzaque, president of Bangladesh Engineering Market Owners' Association, requested the federal government to defer VAT and electricity bill payments for a calendar year. This association represents 40,000 members.

He also known as for waiving VAT on locally made capital machinery and businesses providing mending services. Aside from fiscal support, a few non-fiscal assistances may also support SMEs, he added.

A lot of the CMSMEs found in Old Dhaka do not have lender accounts, said Mohammad Jalal Uddin, president of the Bangladesh Loaf of bread Biscuit and Confectionery Manufacturers Association. He said 95 per cent of SMEs were very good borrowers and efficiently repaid their loans.

He called after banks to provide loans to CMSMEs without bank accounts based on tips of the respective business bodies. There are 5,000 bakeries in Bangladesh out which simply 270 are functioning.

Without fiscal assistance, tiny industries in Old Dhaka will face a major problem, he said.

Jalal informed that 1,000 bakeries in Dhaka generated employment for 2 lakh people.

The primary problem in Old Dhaka is traffic congestion, he added. He as well requested the government to permit CMSMEs to fork out all utility bills through equal instalments within the next six months.

Almost all of the CMSMEs cannot fulfil most requirements of banking institutions, said Md Golam Mawla, president of Bangladesh Edible Essential oil Wholesalers Association. He as well said entrepreneurs of the sector were yet to get fiscal support from banking institutions.

Entrepreneurs engaged in making consumer items need large investments and they also want financial support at the moment, he said.
Source: https://www.thedailystar.net

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