Anisul Islam Noor :
The garment factory owners are lobbing with the influential government ministers and officials to get the sovereign guarantee against the foreign loan. But the economists opine that the government usually does not issue sovereign guarantee for any private project.
The government has recently allocated 530 acres of land at Bausia under Gazaria upazila in Munshiganj to set up a garment industrial zone, where as many as 577 factories can be accommodated.
Two Chinese companies have shown their interest to finance for developing the industrial zone.
Hong Kong KRD International Investment Group Limited in December last year also agreed to give loan worth Tk 1,400 crore at low interest rate to the garment factory owners with a condition of sovereign guarantee, garment sector leaders said.
The country’ leading economists have opposed the proposal. They say, it will be risky for the government to give sovereign guarantee for the private sector project, as the government will be responsible for the repayment of the
loan if the garment factory owners become defaulters.
‘I do not support it. Why will the government issue sovereign guarantee against the garment factory owners’ loans?’ Former Finance Adviser to the caretaker government AB Mirza Azizul Islam said.
The government will have to make repayment in case the garment factory owners become loan defaulters, he said.
Former Bangladesh Bank Governor Salehuddin Ahmed said the government should not issue sovereign guarantee against foreign loan for garment factory owners as it is risky.
The government could arrange special loan for the factory owners from local banks to develop the industrial zone, he said.
‘The proposed garment industrial zone is completely a private sector project and there is no reason on the part of the government of taking responsibility of the foreign loan,’ Policy Research Institute Executive Director Ahsan H Mansur said.
He said, the government should be more vigilant about the sovereign guarantee against foreign loan to avoid ‘unnecessary loss’.
The garment factory owners are lobbing with the influential government ministers and officials to get the sovereign guarantee against the foreign loan. But the economists opine that the government usually does not issue sovereign guarantee for any private project.
The government has recently allocated 530 acres of land at Bausia under Gazaria upazila in Munshiganj to set up a garment industrial zone, where as many as 577 factories can be accommodated.
Two Chinese companies have shown their interest to finance for developing the industrial zone.
Hong Kong KRD International Investment Group Limited in December last year also agreed to give loan worth Tk 1,400 crore at low interest rate to the garment factory owners with a condition of sovereign guarantee, garment sector leaders said.
The country’ leading economists have opposed the proposal. They say, it will be risky for the government to give sovereign guarantee for the private sector project, as the government will be responsible for the repayment of the
loan if the garment factory owners become defaulters.
‘I do not support it. Why will the government issue sovereign guarantee against the garment factory owners’ loans?’ Former Finance Adviser to the caretaker government AB Mirza Azizul Islam said.
The government will have to make repayment in case the garment factory owners become loan defaulters, he said.
Former Bangladesh Bank Governor Salehuddin Ahmed said the government should not issue sovereign guarantee against foreign loan for garment factory owners as it is risky.
The government could arrange special loan for the factory owners from local banks to develop the industrial zone, he said.
‘The proposed garment industrial zone is completely a private sector project and there is no reason on the part of the government of taking responsibility of the foreign loan,’ Policy Research Institute Executive Director Ahsan H Mansur said.
He said, the government should be more vigilant about the sovereign guarantee against foreign loan to avoid ‘unnecessary loss’.
