International Business Forum of Bangladesh (IBFB) organized a discussion session on “Industrial Growth and the Role of Financial Institutions”. This session was held on 5th September 2007 at Pacific Sonargaon Hotel, Dhaka

The session was chaired by the IBFB President Mahmudul Islam Chowdhury and the keynote paper was presented by Mr. Khondkar Ibrahim Khaled, the former deputy governor of Bangladesh Bank. The Secretary of Industries Dr. Md. Nurul Amin addressed the session as the Guest of Honor.

Amongst the others the presentation were made by Mr. FRM Hafiz Ul Islam, Managing Director, Bangladesh Shilpa Rin Sansgtha, Mr. A. Quadir Chowdhury, Managing Director, Phoenix Leasing and Investment Ltd, and Mr. Hafizur Rahman Khan Chairman, Runner Automobiles Ltd. and Director, IBFB

The objective of organizing this session was to identify barriers faced by private level entrepreneurs in accessing long-term finance for industrial projects from the financial institutions and to propose solutions to overcome the barriers for overall industrial growth in Bangladesh.

The followings recommendations came out from the discussion:

1. Government to take a policy and strategy to reduce the interest rate and transaction cost for long term industrial finance

2. Commercial Banks should go for long term industrial finance in addition to short term working capital finance

3. Government should corporatize or privatize the Nationalized Commercial Banks and Financial Institutions that are not making profits for a long

4. The specialized banks should be made more effective and strengthen to expedite industrial finance

5. Commercial banks should encourage and offer lucrative schemes for attracting long term deposits in order to finance industrial projects

6. The banks officials should be more trained in credit appraisal, distributing and managing long term loan for industrial ventures

7. Universal banking concept should be made popularized amongst the financial institutions to strengthen coordination amongst them for more industrial financing

8. A block allocation should be made from Government for long term project financing in the thrust industrial sector

9. Government should adopt a policy to ensure long term industrial loan to the Small and medium Enterprises (SMEs) with less or no collateral based lending.