FEPD Circular No. 26: Export subsidy/Cash incentive for financial year 2018-2019

Foreign Exchange Policy Department
Bangladesh Bank
Head Office
Dhaka
Ref. No. FEPD-Circular-26
Bhadra 26, 1425
FEPD Circular No. 26 Date: -------------------- September 10, 2018 To All Approved Dealers engaged in foreign exchange transactions.

Regarding provision of Export Subsidy/Cash Incentive against exports in the fiscal year 2018-2019.

In order to encourage the country's export trade, the government has taken a decision to provide export subsidy/cash incentive for certain products in the export sector during the current fiscal year 2018-2019. Accordingly, against the export of the following goods shipped from July 01, 2018 to June 30, 2019, export subsidy/cash incentive shall be payable at the respective rates mentioned alongside:

S.No | Name of Export Product | Applicable Rate ---|---|---

1. Cash incentive as an alternative to Bonded Warehouse and Duty Drawback in the domestic garment industry oriented towards export | 4.00%
2. Additional benefit for Small and Medium Industries in the garment sector (as per prevailing rules) | 4.00%
3. New Product/New Market (Garment Sector) Expansion Assistance (excluding America/Canada/EU) | 4.00%
4. Special additional assistance of 2% over the existing 4% for garment exporters in the Euro region | 2.00%
5. Cash incentive in the export sector of hand-made products made from Hogla, straw, sugarcane bagasse etc. (including products produced from coconut husk fiber) | 20.00%
6. Export Subsidy in the export sector of agricultural products (vegetables/fruits) and processed agricultural products (Agro-processing) | 20.00%
7. Export Subsidy against the export of intestines, tripe, horns and sinews of cows/buffaloes (excluding bones) | 10.00%
8. Export Subsidy in the export sector of Light Engineering Products | 15.00%
9. Export Subsidy in the export sector of 100% Halal Meat | 20.00%
10. Cash incentive in the export sector of Frozen Shrimp and other fish:
    (a) Ice glazing rate in frozen shrimp export:
    Less than 20%: 10.00%
    Above 20%: Less than 30%: 9.00%
    Above 30%: Less than 40%: 8.00%
    Above 40%: 7.00%
    (b) Ice glazing rate in frozen other fish export:
    Less than 20%: 5.00%
    Above 20%: Less than 30%: 4.00%
    Above 30%: Less than 40%: 3.00%
    Above 40%: 2.00%
11. Cash incentive in the export sector of Leather Goods
    (Ceiling limit will remain unchanged as in the previous year) | 15.00%
12. Export Subsidy against the export of Raw and Finished Leather produced in factories located in Savar Leather City and factories having their own ETP located outside Savar | 10.00%
13. Export Subsidy against ship export | 10.00%
14. Cash incentive in the potato export sector | 20.00%
15. (a) Export Subsidy against PET Bottle-Flakes export
    (b) Export Subsidy against Polyester Staple Fiber produced from PET Bottle-Flakes export (payable under the existing circulars for the PET Bottle-Flakes sector) | 5.00% 10.00%
16. Export Subsidy against furniture export | 15.00%
17. Export Subsidy against seed of grains and vegetables export | 20.00%
18. Export Subsidy against Carbon produced from Jute stick export | 20.00%
19. Export Subsidy against Plastic goods export | 10.00%
20. Export Subsidy in the export of paper and paper-based products produced in the country | 10.00%
21. Export Subsidy against Agar and Attar export | 20.00%
22. Export Subsidy against Software, ITES (Information Technology Enabled Services) and Hardware export from Bangladesh | 10.00%
23. Export Subsidy against Active Pharmaceutical Ingredients (API) export | 20.00%
24. Export Subsidy against Accumulator Batteries (HS Code: 8507.10 and 8507.20) export | 15.00%
25. Export Subsidy against footwear made of synthetic and fabric mixtures export | 15.00%

Continued on Page-2

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26. Cash Subsidy in the export sector of Jute goods:
a) Jute Yarn (Yarn and Twine) b) Final Jute Products (Hessian, Sacking and SBC) c) Diversified Jute Products (As per the definition of diversified jute products mentioned in the Jute Act 2017, minimum 50% value of jute must be used) | 7.00% 12.00% 20.00%

2. Besides the above-mentioned products, it has been decided to provide Export Subsidy/Cash Incentive for the following export products starting from the fiscal year 2018-2019:

S.No | Name of Export Product | Applicable Rate ---|---|---

1. Pharmaceuticals Products | 10.00%
2. Chemical Fertilizers | 10.00%
3. Motorcycles | 10.00%
4. Chemical Products (Chlorine, Hydrochloric Acid, Caustic Soda and Hydrogen Peroxide) | 10.00%
5. Razors and Razor Blades | 10.00%
6. Ceramic Items | 10.00%
7. Caps/Hats | 10.00%
8. Crabs and Prawns (Frozen and Softshell)
   (Subject to obtaining permission from the Environment and Forest Department) | 10.00%
9. Dried Fish/Dried Shrimps (Dried Shrimp Paste, Dried Shrimp Powder and Shrimp and Dried Shrimp) | 10.00%

Export subsidy/cash incentive can be availed for the 9 products listed in Serial No. 2 above from the date of issuance of the circular in the export sector.

3. In the matter of providing Export Subsidy/Cash Incentive, all other instructions of the relevant FEPD Circulars/Circular Letters including the conditions specified in FEPD Circular No. 24 dated September 20, 2016 and FEPD Circular No. 31 dated August 17, 2017 shall remain unchanged as usual.

All concerned parties are requested to take note of this.

Yours faithfully,
(Md. Harun-Ar-Rashid)
Deputy General Manager
Phone: 9530625