Dhaka, Bangladesh (BBN)- Foreign industrial enterprises operating in Bangladesh will not require taking prior approval from Bangladesh Bank to bring interest-free short-term loan with up to one year tenure from their parent companies and shareholders abroad.
“Foreign owned/controlled industrial enterprises in Bangladesh have indicated occasionally arising urgent necessity of short term borrowing for business needs other than inputs procurements, for which working capital financing from the local market has not yet been lined up,” the central bank said in a circular, issued on Wednesday.
Talking to BBN, a senior official of the Bangladesh Bank (BB) said foreign enterprises usually plunge into difficult situation to get an instant short-term loan from the local market as they are yet to develop a good relation with the banks.
Against the backdrop, the BB decided that the foreign industrial enterprises would get access interest-free loans from their parent companies and shareholders without any prior approval from the central bank, the BB official explained.
Repayment of these loans will likewise require no prior approval, but the foreign enterprises will have to report on loans and repayment to the foreign exchange policy department of the BB, the circular added.
BBN/SSR/AD-14Mar14-4:54 pm (BST)
