Dhaka needs to pay $460m to join New Development Bank
Bangladesh will have to pay about $460 million in subscription fee to become a member of the New Development Bank (NDB) or BRICS Bank, a new international lender looking to mobilise resources for infrastructure and sustainable development projects. Of the sum, $92 million shall be contributed to the bank’s paid-up capital payable in seven annual instalments, according to a letter of the High Commission of India (HCI) in Dhaka. The government will now move to discuss the membership issue with the management of the NDB. The lender began its official journey on July 21, 2015, with an initial capital of $50 billion. The total capital of the bank is $100 billion. The rationale for membership expansion of the NDB is to increase capital base, improve credit rating, and make it a truly global development financial institution. The management has shortlisted 20 targeted countries for consideration for membership. Current members of the new bank are Brazil, Russia, India, China and South Africa. Each of the current members is scheduled to nominate two countries into the bank, according to the Economic Times newspaper of India. So far, the bank has approved more than 50 projects involving over $15 billion within BRICS countries. The expected financial commitment from new members would be relatively small in relation to direct lending and procurement benefits. Based on current authorised capital, each 1 per cent of shareholding at the NDB would correspond to $1 billion of capital, of which $200 million shall be contributed to the paid-up capital.
High food prices weighing on the vulnerable: FAO
High prices of rice and other important food items, including soybean oil and loose palm oil, have severely constrained the purchasing power for a large section of the vulnerable population above the poverty line in Bangladesh. The UN agency said prices of rice in the Dhaka market increased steadily throughout 2020, reflecting tight market availabilities, exacerbated by an upsurge in domestic demand due to the Covid-19 pandemic. It said overall prices of rice were more than 35 per cent above their year-earlier values and at their highest level since October 2017. Monthly prices data of Dhaka city compiled by the FAO showed that prices of coarse rice soared 38 per cent year-on-year to Tk 44.4 per kilogramme in January this year, the highest since September 2017. Medium grains rose 39 per cent year-on-year to Tk 50.81 each kg, data showed. The UN agency said prices of mostly imported wheat flour decreased in the first part of 2020, reflecting adequate market supplies from the bumper output harvested in April and above-average imports. Starting from August, prices have been generally increasing, supported by trends in the international markets. Overall, prices in January 2021 were slightly above their year-earlier levels. Citing an official estimate, the agency said 29.5 per cent of the total population was poor as of June 2020, up from 20.5 per cent in June 2019 The FAO said Bangladesh hosts about 8,60,000 Rohingya refugees from Myanmar, most of whom were residing in the Cox’s Bazar district. Overall, the 2020 aggregate paddy production is estimated to be at 5.48 crore tonnes, up marginally from 5.47 crore tonnes the previous year.
Govt-fixed soybean oil rates fall on deaf ears
Retailers and wholesalers in Chattogram market are continuing to charge Tk 3 to Tk 4 higher than the Tk 115 fixed by the government as the retail price of each litre of loose soybean oil four days ago. According to the sellers, loose soybean oil is selling for Tk 110 per litre at mill gates and at Tk 117 to Tk 118 at retail, although the government had fixed Tk 108 for the former and Tk 115 for the latter last Wednesday. Wholesale traders at Khatunganj market, one of the country’s largest wholesale commodity hub, say loose soybeans was being sold at mill gates for Tk 4,300 per maund (40.90 litres) at the beginning of last week. However, on Saturday the price was hiked to Tk 4,500. The main reasons being supply shortages and price hikes in international markets. According to the Chattogram Custom House data, more than 9.18 lakh tonnes of edible oil, including crude soybean and refined palm oil, worth Tk 5,539 crore were imported in the past seven months from July to January of the current fiscal 2020-21. Some 13.13 lakh tonnes of edible oil worth Tk 6,386 crore was imported in the same period of FY 2019-20. On Wednesday, the commerce ministry fixed the price of loose soybean oil at Tk 115 per litre at the consumers’ level, Tk 110 per litre at the distributor level and Tk 107 per litre at the mill gate. Bottled soybean oil has been fixed at Tk 135 per litre at the consumers’ level, Tk 127 per litre at the distributor level and Tk 123 per litre at the mill gate.
Delta Life to appoint US actuary firm to assess health
Delta Life Insurance is going to appoint a foreign actuary firm to get an independent assessment of the health of the insurer, which came into the spotlight for breaching rules and making bribery allegation against the head of the industry regulator. After appointing an administrator in the company, the Insurance Development and Regulatory Authority (IDRA) ordered special audits into Delta Life Insurance to ascertain the authenticity of allegations from stakeholders. The IDRA appointed Mollah as the administrator on February 11 to protect policyholders’ interests and submit a report on the company’s situation within four months. Earlier, Delta Life Insurance accused IDRA Chairman M Mosharraf Hossain of seeking Tk 50 lakh in bribes for giving approval to the reappointment of the company’s chief executive officer and renewing the actuarial valuation basis. The insurer complained against Hossain with the Anti-Corruption Commission (ACC) on December 7, 2020. On December 9, it sent another letter to the commission, alleging that he demanded the bribe. The IDRA ran a special audit through Howladar Yunus & Co in 2019 and then an investigative audit through Fames & R Chartered Accountants to verify allegations from shareholders and policyholders.
Pandemic wreaks havoc on car sales
Passenger vehicle sales fell by around 26 per cent in 2020 compared to the previous year due to the ongoing coronavirus pandemic and imposition of additional road tax. Passenger car sales were at its lowest in the past seven years as a total of 12,403 units were sold in 2020 while it was 14,681 units in 2014. Until the last fiscal, the owners of cars or jeeps with up to 1,500cc engine capacity had to pay Tk 15,000 as road tax while those with up to 2,000cc engine capacity paid Tk 30,000. The rates of taxes for these vehicles increased to Tk 25,000 and Tk 50,000 respectively in the current fiscal. Meanwhile, a car or jeep with an engine capacity of 2,000-2,500cc now has to pay 50 per cent more at Tk 75,000. Similar vehicles with an engine capacity of 2,500-3,500cc will have to pay 25 percent more. Car sales have come down to 41 units per day in 2020 while it was 56 units in 2019 and 61 units in 2018. The government brought down the maximum depreciation on imported reconditioned vehicles from 45 per cent in fiscal 2015-16 to 35 per cent in 2018-19.