Garment exporters using local yarn to get 5% cash incentive

Only readymade garment exporters using domestically produced yarn will qualify for revised rate

The government has raised the alternative cash incentive for the textile sector from 1.5 percent to 5 percent, boosting support for garment exporters using locally produced yarn and fabric.

Bangladesh Bank had announced in a circular on Jul 5 that exporters would continue receiving the previous fiscal year's 1.5 percent incentive for export-oriented garments made with locally sourced textiles during the 2026-27 fiscal year.

Less than two weeks later, the central bank revised the policy on Sunday in place of bonded warehouse and duty drawback facilities.

Bangladesh Bank officials said the higher incentive was introduced in response to demands from textile sector businesses.