Dhaka, Bangladesh (BBN) – Industrial term loan disbursement declined slightly in the last fiscal as against the previous fiscal reflecting an investment slowdown in the backdrop of the ongoing global meltdown.
“Entrepreneurs are following a ‘go-slow’ strategy because of the global economic recession. As a result, the disbursement of term loans has decreased in the fiscal 2008-09 (FY09),” a senior official of the Bangladesh Bank (BB), the country’s central bank, said on Monday.
Besides, some local entrepreneurs could not make fresh investment due mainly for the lack of adequate infrastructure facilities including gas in the country, the BB official noted.
The disbursement of term loan fell by 0.88 per cent to BDT 199.72 billion in FY09 from BDT 201.50 billion of the previous fiscal, according to the central bank provisional statistics.
The estimate includes disbursement of fresh credit, rescheduling of term loans and fund release for balancing, modernization, rehabilitation and expansion (BMRE) of industrial units, according to the BB officials.
The BB official also said disbursement of term loan may pick up in the current fiscal after the introduction of the framework for public private partnership (PPP).
“Private investment in different infrastructure projects will increase through PPP initiatives,” the BB official said, adding that authorities concerned should formulate framework for the PPP immediately.
On the other hand, the recovery of the term loan increased by 19.66 per cent in the last fiscal as the banks and financial institutions intensified their recovery drive in line with the BB directives, the officials said.
In fiscal FY09, the industrial credit recovery was BDT 163.02 billion compared to BDT 136.24 billion of the previous fiscal, the BB’s data showed.
BBN/SS/SI/AD-01September09-1:23 am (BST)
