Dhaka, Bangladesh, June 22—The country’s jute exporters demanded 30 percent cash incentives to compete in the global market. Currently jute exporters are receiving 7.5 percent cash incentives.
President of Bangladesh Jute Goods Association, Shahedul Islam Helal told The New Nation that the jute sector did not get the priority and the assistance it deserves. He also said that the proposed national budget has given one of the highest priorities to the agriculture sector.
He said that, in the proposed 2004-05 budget announced on June 10, agricultural products have been allotted 30 percent cash subsidy for its export. As jute is also an agricultural product, it deserves the same subsidy, they observed.
He also said that cash subsidy on export is a better method of assisting the jute sector compared to handouts or charity. Nearly 80 percent of total jute goods production of Bangladesh is exported and thus high cash incentive on export should be the highest priority for development of this sector.
“People working in the jute sector are apprehensive that the incentive and the facility allotted for the agriculture may not be passed on to the jute sector,” he added.
Helal further said that jute sector needs generous assistance from the government to increase the share of its export market. Cash incentive on export is an assistance which is performance based. If the cash subsidy was increased jute mills would increase their production to get this benefit. This in turn will help to increase the efficiency level of Bangladesh’s jute industry, he said.
He also said that the present average efficiency level of the jute industry is below 40 percent. It can be increased only by rewarding jute mills based on their export performance, he observed.
Jute sector appreciated the budget policy whereby jute was given equal treatment as garment by reducing the tax base to 15 per cent. An additional 10 percent supplementary duty was added for import of synthetic floor. This will assist jute carpet industry to get a bit higher share of the local market, he said.
