Dhaka, Bangladesh (BBN) – The central bank of Bangladesh has relaxed regulations in support of the ICT (information and communication technology) sector helping it achieve the target of US$5.0 billion software exports by 2021.
Under the relaxations, the banks are now allowed to remit from $25,000 to $30,000 on behalf of IT or software firms in a calendar year, the Bangladesh Bank (BB) said in a notification issued on Sunday.
“Within the limit of $30,000, international cards may be issuable for $6,000 instead of $2,500, which may be refilled subject to the availability of the limit,” it noted.
Talking to BBN, a senior official of the Bangladesh Bank (BB) said the facility is not linked to the Exporters’ Retention Quota (ERQ) account and is remittable through wire transfer and/or international card within the limit.
He also said the central bank enhanced the remittable limit for the Bangladesh Association of Software and Information Services (BASIS) members IT/software firms to help meet their genuine expenses in a calendar year. “It will also help new businesses in the sector.”
The BB also increased the limit of ERQ to 70 per cent from 60 per cent earlier to facilitate exports of ICT services.
“To promote exports of ICT services, it has now been decided that ICT-related service exporters may retain 70 per cent of their repatriated exports receipts in ERQ accounts,” the central bank said in another notification on the same day.
The central bank, however, simplified declaration on ‘Form-C’ for inward remittance for the purpose of ICT-related services to assess the actual exports earnings from the ICT sector.
The BB also advised the banks to extend all-out cooperation to the exporters so that inward remittance can be encashed/credited to the relevant accounts within reasonable time.
“Definitely, we have welcomed the BB’s latest moves. It will help achieve software exports target of $5.0 billion by 2021,” Mustafa Jabbar, president of the BASIS, said in his initial reactions.
He also said the BASIS members will be able to cross the target if the government continues its support.
The government and the BASIS had earlier set the export earnings target considering overall business performance of the ICT sector.
The BASIS is the national trade body for Software and IT Enabled Service industry of Bangladesh.
Established in 1997, the association is dedicated to developing vibrant software and IT service industry in the country.
Meanwhile, Bangladesh’s software exports have seen more than 14.50 per cent rise to nearly $152 million in the fiscal year (FY) 2015-16 compared to the same period in the previous year
According to the Export Promotion Bureau (EPB) data, in the last fiscal year, Bangladesh earned $151.83 million, a 14.55 per cent up over $132.554 million a year ago.
The figure is 4.71 per cent higher against the target of $145 million for the period.
The industry insiders, however, claimed that Bangladesh actually earned around $700 million in the FY 16.
“The official export earnings figure was lower than actual ones mainly due to the lack of proper reporting system,” an insider explained.