New Export Target and To-Do-List

The Draft Export Policy 2021-2024 that was approved by the Cabinet Committee on Economic Affairs on Wednesday demonstrates the government’s eagerness to boost the country’s export earnings to a higher level. While the government is not directly involved in export business, it has enormous passive roles in facilitating the private sector towards boosting exports and achieving the target. The Export Policy target is not like the targets the government typically sets each year for revenue earnings, or that of Import Policy Orders generally framed for every three years. If framing the export policy is not a routine work as far as the role of the government is concerned, it is the government policies on fiscal and monetary fronts that can play a vital role in augmenting export incomes by the private sector.

The target set for 2023-2024 fiscal year in the proposed export policy is $80 billion, up by 57 per cent from the current fiscal year’s expected amount. The target is, however, ambitious and unachievable if not supported by fiscal tools and pro-business policies of the government. Finance Minister AHM Mustafa Kamal in the virtual meeting of the Cabinet Committee on Economic Affairs said that the government would do whatever it takes to achieve the $80 billion export target. Our export earnings are rebounding despite the threat of the virus. The momentum could be further accelerated if the government is keen to translate the dream of $80 billion into a reality. As long as the major portion of the country’s export basket depends on imported raw materials and intermediate goods, competitive prices for our exporting goods will not be that easy.

According to different media reports published on Thursday, the proposed policy will treat exports through e-commerce as direct exports, by ensuring policy support. E-commerce and freelancing will get an efficient banking system to bring home export earnings directly through banking channels. Strategies to meet the high export target, the proposed export policy advocates providing similar benefits, which the apparel sector is enjoying, to non-RMG export sectors, such as food processing, leather and leather goods, light engineering, pharmaceuticals, agricultural products, jute products, and halal products. Besides, manmade fibres, halal fashion, recycled products, freelancing, software, and IT-enabled services sectors have been added to the list of priorities in achieving the target of export earnings.

The policy suggested offering all kinds of support to exporters manufacturing green and organic products. The government will set up an international standard testing certification and accreditation system to ensure that investments in these sectors are tax-exempt for a fixed period, to provide them with soft loan facilities, and to ensure product quality.

All the features in the proposed policy are encouraging and demonstrate the commitment of the government towards earning more from the export sector. The government has to increase the handling capacity of Chittagong port, control inflationary trends, and reduce import dependence on raw materials.

Raising export earnings after buying raw materials at high prices from international markets is not an easy task. Rather, we need more value addition to ensure the benefits of export earnings. Besides, towards expanding foreign markets for local goods the policymakers must make sure that low cost finance is available for entrepreneurs and incentives are provided against export receipts across the board. Brushing aside the revenue loss fear, it is high time the nation opts for free trade area agreements with a number of potential countries and trade blocs to open new markets for goods from Bangladesh. The traditional trade outlook process without taking into account the best available examples of trade pacts will not benefit the country for long. Over-dependence on a few export products cannot take the nation to the $80 billion target mark. Potential items like light engineering, electronics, and digital devices have huge potential to grow and capture foreign markets. Dedicated policies and attention are of foremost importance to come out from the traditional product list and diversify export items.