DHAKA, Feb 17, 2024 (BSS) - Speakers at a seminar today said that non RMG product diversification is now the demand of time for post-LDC export readiness.

They made the remarks while addressing a seminar on "Bangladesh's Export Readiness: post LDC graduation perspective" organized by the Dhaka Chamber of Commerce and Industry (DCCI).

In the open discussion session, the speakers demanded for subsidy on utility services and development of backward linkage industry.

They also said that large conglomerates should come up with investment in high-end industry. Moreover, they proposed for arranging more international trade fairs. They also termed agro-processing industry, the most potential billion dollar industry for Bangladesh in future.

DCCI president Ashraf Ahmed said that the concerned entrepreneurs do not have much time for export readiness as Bangladesh is going to graduate from the LDC status in 2026 which is knocking at the door.

"It's true that the government is firmly committed to support the business community by all means to create a commendable position in the international market, but the private sector needs a sustainable policy reforms in the days to come," he added.

Ashraf also said that the more conducive business environment can be created, the faster it would be possible to achieve the 'strategic bets approach' to have more products on its basket. He also reiterated the need for easy access to finance for export-oriented industries and reliable exchange rate.

Dr. Selim Raihan, executive director, SANEM made a power-point presentation and said that LDC graduation would create many opportunities for Bangladesh but to grab those, there is a need to do massive pragmatic policy reforms.

He also said that the country's export basket is still RMG oriented, but there is a need to have export diversification. "For export readiness after LDC graduation, he suggested for harmonization of monetary policy and fiscal policy, regulatory efficiency and regulatory quality, reducing NPL, ensuring long term financing from capital market," he said.

"Moreover, we're lagging behind in trade logistics," he added.
Selim also underscored the importance on labour productivity by skills development. "And for that public expenditure in education sector is important," he further said.

He also highlighted that private sector investment is stagnant as well as FDI inflow is low. "Right at this moment, we have to make our economic zones fully ready as soon as possible," he added.

Asif Ashraf, director, BGMEA said that the special incentives to the RMG sector has been scaled down recently. He raised a question to the authority that why this decision is taken before 2026.

"Still our export is dominated by the RMG sector... the non-cotton market is the most potential sector which is still untapped by the Bangladeshi manufacturers," he said demanding for a conducive exchange rate for being competitive in the international market.

Mohammed Mahbubur Rahman Patwary, managing director, Sonali Aansh Industry Ltd. said that there is a need to incentivize the other non-RMG but potential products to grow.

"After graduation, most of incentives will not be effective in that case we may examine the examples of those countries who are already graduated that how they are managing their main export basket," Mahbubur said urging for policy consistency, bond facility and reducing cost of doing business.

In his welcome remarks, DCCI's senior vice president Malik Talha Ismail Bari said Bangladesh needs to diversify its industries by establishing new sectors like FMCG, Plastic goods, Light-engineering, IT&ITES, and Halal products, while simultaneously maximizing the potential of high-priority Billion-Dollar frontier industries like Leather and Footwear, Agro-processing, Jute and jute products, Pharmaceuticals, and home-textile, replicating the successful RMG model.

"Banks need to provide sector specific tailored export financing, like credit insurance, export development fund, and working-capital loan to address export-related financial challenges," he added.

DCCI vice president Md. Junaed Ibna Ali and members of the board of directors were also present at the seminar.