The Prime Minister's Office in a letter on September 29 asked the finance ministry to take initiatives for disbursing the aid for rehabilitation of the apparel units.

The PMO also instructed the finance ministry to exempt the bank loan interest of the units and help them reschedule their loans. A similar PMO directive was sent to the commerce ministry as well.

When contacted, a high official of the Monitoring Wing of the Finance Ministry said it is a tough job for the ministry to allocate the fund to the sick factories, as the government did not earmark the fund in the budget.

Despite the limitations, the ministry is working hard to follow the PMO directive, he added.

Meanwhile, a former director of BGMEA (Bangladesh Garment Manufacturers and Exporters Association) alleged the selection of the sick units was done on political considerations.

"At least 75 out of 100 sick units selected for the aid are owned by people who are close to the ruling BNP," said the former director, who sought anonymity.

BGMEA President SM Fazlul Hoque however denied the allegation, saying there had been no bias during the selection process.

Industry sources said there are around 1,900 sick RMG units, which are plagued with Tk 574 crore bad loans. The interest of the loans now stands at Tk 521 crore.

The sick units owe Tk 394 crore in interest and Tk 351 crore in principal amount of loans to eight public commercial and specialised banks. The units also owe Tk 126 crore in interest and Tk 183 crore in principal amount of loans to 21 private banks.

A high-powered committee on resumption of the sick export-oriented garment units headed by a joint secretary was formed on February 28, 2005.

The committee in its report suggested resumption of the sick factories in phases.