Supply chain extortions rise by up to 50% after July uprising: DCCI
It urges ‘zero tolerance’ for corruption and renegotiation of ‘sovereignty-threatening’ US trade deal
Highlights
- Factory-level extortions surge by 20% to 50% in several regions
- Govt urged to show 'zero tolerance' against corruption
- US trade deal compromises economic independence
- The deal risks relationships with other major trading partners
- Shortening loan classification grace period to be detrimental
- Call for reversal of 41% hike in Ctg port
Extortion at the factory level and within domestic supply chains has surged by 20% to 50% in certain regions following the July 2024 uprising, the Dhaka Chamber of Commerce and Industry (DCCI) said yesterday.
It urged the newly elected government to adopt a zero-tolerance policy to revive what it described as an "ailing economy."
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Presenting the chamber's annual action plan, titled "Road to Revival," DCCI President Taskeen Ahmed warned that economic progress would remain an unattainable dream unless criminal activities and public sector corruption are suppressed "overnight with a heavy hand."
He also criticised a trade deal regarding the reciprocal tariffs signed by the interim government with the United States under a non-disclosure agreement.
Terming the deal a threat to economic sovereignty, the DCCI chief said it binds Bangladesh to purchase $15 billion worth of LNG from the US over 15 years and restricts its ability to offer subsidies.
"Our RMG sector contributes 13% to the GDP, and trade with the US is less than 2% of our GDP. To secure a 1% tariff reduction, we cannot compromise our broader economic interests or our relationships with other major trading partners," he stated, urging the incumbent government to strategically renegotiate the agreement.
On the logistics and energy fronts, the DCCI demanded an immediate reversal of the 41% hike in Chattogram Port service tariffs and called for offshore gas exploration to bridge a daily gas supply gap of 925 MMSCFD.
While the chamber welcomed the government's target to raise the tax-to-GDP ratio to 8%, it insisted on 100% automation of the National Board of Revenue to prevent harassment.
The DCCI also lauded the government's recent formal request to the United Nations to defer Bangladesh's LDC graduation by at least three years, citing the economic setbacks from the pandemic and recent political transitions.
Expressing deep concern over the financial sector, Taskeen noted that private sector credit growth plummeted to a 22-year low of 6.49% in the 2024-25 fiscal year.
He also criticised the central bank for shortening the loan classification grace period from nine months to three months. He argued that the move artificially inflated non-performing loans (NPLs) to Tk6.44 trillion, representing 36% of total loans.
With lending rates soaring to 16-17%, the DCCI chief called for a reduction in the policy rate and the introduction of subsidised credit lines for genuine businesses.
He argued that the move is penalising genuine businesses that are suffering from working capital shortages due to massive currency devaluation and high borrowing costs.
"While wilful defaulters must face strict punishment, genuine SMEs and businesses need breathing room. We urge the government to reconsider the loan classification rules, reduce the policy rate, and introduce subsidised credit lines to lower borrowing costs," Taskeen said.
