Published: 09:10 AM, 03 May 2026
‘Govt to cut interest rates to be lowered to boost investment’
Commerce Minister Khandaker Abdul Muktadir on Wednesday said the government plans to bring down double-digit lending rates to make them more investment-friendly, particularly for key industrial sectors. “Industries like textiles cannot survive with high-cost financing under double-digit interest rates,” he said while inaugurating the Bangladesh International Textile, Knitting and Garment Industry Exhibition (BTKG Expo 2026) at the International Convention City Bashundhara (ICCB). The four-day expo, jointly organised by the Bangladesh Knitwear Manufacturers and Exporters Association and Inforchain Digital Technology Co Ltd, will continue until 2 May, showcasing machinery and technologies for the textile and garment sectors. The minister said the industrial sector, especially the garment industry, plays a vital role in driving economic growth through investment and employment generation.
However, he noted that energy shortages and high lending rates—currently ranging between 13% and 14%—remain major challenges. “With such high funding costs, labour-intensive and low-margin industries like textiles cannot sustain operations,” he said, adding that while such rates may suit capital-intensive sectors, they are not viable for primary industries.
Highlighting the energy situation, he said Bangladesh requires around 4,300 MMCFD of gas daily, while domestic production ranges between 1,700 and 2,300 MMCFD, supplemented by about 900 MMCFD through imported LNG—leaving a deficit of 1,400 to 1,700 MMCFD. He said the government is willing to increase LNG imports, but infrastructure limitations, including the capacity of existing floating storage and regasification units (FSRUs), pose challenges. Plans are underway to invite tenders for additional FSRUs to boost gas supply and support industrial growth. Emphasising energy security, the minister warned that any disruption in fuel supply could severely impact industrial production and overall economic activity. In the long term, the government is prioritising renewable energy and aims to fast-track the generation of 10,000MW of solar power. He also said steps are being taken to simplify business procedures, including licensing, to encourage investment.
“At present, obtaining around 25 to 26 licences can take months or even years, discouraging investors. We are working on a system to provide provisional clearance immediately after application, allowing businesses to begin operations while full approval continues,” he said.
He added that efforts are underway to streamline bond and tax procedures and reduce harassment through digitalisation, with a focus on expanding the tax base rather than increasing tax rates.
Currently, the country has two floating storage and regasification units with a combined capacity of around 1,100 MMCFD, operating at about 90 per cent efficiency. The government plans to invite tenders for additional FSRUs to expand gas supply and support gas-based industries, he added. Emphasising the importance of energy security, he said any disruption in fuel supply would severely affect industrial production and overall economic activity.
‘We are working on a system where, upon application, businesses will receive provisional clearance immediately, allowing them to start operations, while the full approval process continues in parallel,’ he added. The minister also said that efforts are underway to streamline bond and tax-related procedures to make them more business-friendly and reduce harassment.
On revenue, he said the country needs higher tax collection to support infrastructure development and public investment, but the focus will be on expanding the tax base rather than increasing tax rates.
Presided over by Mohammad Hatem, the programme was also addressed by exhibition convener Fazlee Shamim Ehsan and Inforchain Executive Director Spencer Lin. Around 900 exhibitors from nearly 28 countries are participating in the event, featuring about 1,200 booths across a 20,000-square-metre area. Participants from countries including Canada, China, Taiwan, Belgium, France, Hong Kong, India, Indonesia, Japan, Vietnam, Malaysia, Turkey and the United Arab Emirates are showcasing their latest products and technologies.
