Dhaka, Bangladesh (BBN)- Industrial credit disbursement recorded a significant rise by over 29 per cent in the fiscal 2009-10 (FY10) against that of the previous fiscal despite shortage of gas and power supply, officials said.
The disbursement of industrial term loans stood at BDT 258.75 billion in FY10. A total of BDT 199.72 billion was disbursed in FY09, according to the central bank 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.
“BMRE and capital machinery import have contributed to increasing the flow of credit to the industrial sectors,” a senior official of the Bangladesh Bank (BB) said, adding that the central bank expects the disbursement of term loans will increase further in the current fiscal as the government has announced the framework for public-private partnership (PPP) scheme.
Opening of letters of credit (LCs) for capital machinery imports scaled up by over 55 percent to $1.918 billion in FY10 from $1.234 billion of the previous fiscal year while settlement of LCs increased by 3.95 percent to $1.459 billion against $1.403 billion.
The energy and power, telecommunications, pharmaceuticals, textile, housing, construction and transportation sectors have received the lion’s share of the credit, bankers said.
They, however, expect that the flow of industrial credit will increase during this fiscal year if the government ensures better supply of gas and electricity to the industrial units across the country.
On the other hand, the recovery of the term loan increased by 16.44 percent in the last fiscal as the banks and non-banking financial institutions intensified their recovery drives in line with the BB directives, the central bank officials said.
In fiscal FY10, the industrial credit recovery was BDT 189.82 billion compared to BDT 163.02 billion of the previous fiscal, the BB’s data showed.
BBN/SI/AD-30Aug10-12:36 am (BST)