Raise savings tools’ investment ceiling
Government secretaries have requested the finance minister to raise the ceiling on investment in savings tools to help them during their old age. They made the request at a pre-budget discussion. Presently, a government official can invest up to 45%of his or her retirement benefits in savings tools. The secretaries also suggested reducing corporate tax, raising value added tax (VAT) collection, higher allocation for river dredging, steps for reducing migration cost, protecting the interests of local industry, and rationalizing motorcycle registration fee.
Islamic banks, NBFIs to give loan for green buildings
Entrepreneurs would get loans at lower interest rate for Environment-friendly buildings from the refinancing scheme of shariah-based banks and non-bank financial institutions, a Bangladesh Bank master circular issued on Thursday said. The master circular that revised a number of conditions said that the shariah-based banks and NBFIs that had already signed agreement with the central bank would have to sign deal with BB again within three months of the circular. Bangladesh Bank in 2014 introduced the Islamic Refinance Fund Account for the Shariah-based banks and NBFIs from the additional funds the entities keep with the central bank with a view to circulating the idle fund for productive purposes. Bangladesh Bank has so far allowed the shariah-based banks and NBFIs to award the refinance facility to 51 types of environment-friendly ventures. The central bank master circular came to expedite plan of Bangladesh: 2010-2021, National Sustainable Development Strategy 2010-2021, seventh five-year plan and sustainable development goal, and to ease the refinance scheme facility. Under the newly issued circular, BB relaxed some condition for the green industries to get the loan facility, a BB official told New Age.
BB asks banks to keep Ctg port-associated branches open round the clock
Bangladesh Bank on Sunday asked all the scheduled banks to keep their branches at Agrabad area in Chittagong open for round the clock every day of a week with a view to support export and import activities at the Chittagong port. The central bank issued a circular in this regard on the day that was sent to all the chief executives of all scheduled banks. The BB circular issued following an instruction from the Prime Minister’s Office that said that the banks’ branches associated with the Chittagong port and customs would have to keep their branches open for 24 hours a day in 7 days a week.
Move underway to withdraw Rupali Bank shares from Pak Summit Bank
After a three-year lull, the government has moved forward to withdraw existing shares of state-run Rupali Bank from Pakistan-based Summit Bank, officials said. To this effect, they said, a high-powered committee formed by Rupali Bank will visit Pakistan soon. When contacted, deputy managing director of Rupali Bank Hasne Alam said, “A four-member team will go to Pakistan soon for selling our shares in Summit Bank.” He added: “In this connection, we have sent a letter to the finance ministry for approval. We will have to get permission from the State Bank of Pakistan and Securities and Exchange Commission of Pakistan for selling the existing shares.” “The State Bank of Pakistan is very slow. We have some funds in our account. But we are yet to bring back the funds from that country due to lack of required response from the regulatory authorities despite repeated attempts,” said Mr Alam, also chief of the committee. A senior official of Rupali Bank said, “There has been no development even after a change in the management of the Pakistani bank.” Officials concerned said the government in March 2015 took decision to sell 1.84 per cent or 32.77 million shares of Rupali Bank in the Pakistani bank. To this effect, the board of directors of Rupali Bank formed a four-member high-powered committee to withdraw shares and realise all dues from Summit Bank.
BRAC Bank, IFC sign deal to facilitate offshore banking
BRAC Bank Limited and International Finance Corporation (IFC), a World Bank Group concern, signed an agreement for the support and funding of the International Trade and Lending program for its Offshore Banking clients, reports BSS. Under this agreement, BRAC Bank will receive $40 million from IFC as Working Capital Solutions, said a media release yesterday. Selim RF Hussain, Managing Director and CEO of BRAC Bank Limited, and Wendy Werner, Country Manager of IFC Bangladesh, exchanged documents of the agreement at BRAC Bank’s Head Office.
‘Banks should reduce lending rate’
Economists said interest rate should come down to single digit soon as the recent downward adjustment of cash reserve requirement (CRR) and decision to keep 50 per cent of the funds of state agencies in private banks will meet liquidity crisis in the banking sector, report BSS. Talking to news agency, they suggested Bangladesh Bank (BB) to take pragmatic measures including strengthening its monitoring activities and maintaining transparency in the banking sector for the sake of the economy. “There is the scope for banks to cut lending rate as the government has already reduced CRR rate, which will help meet the liquidity crisis in banking sector,” said former finance adviser to the caretaker government Dr Mirza Azizul Islam. He said there is liquidity crisis in the banking sector because the growth of deposit has dropped recently. So, banks need more deposits to meet their liquidity crisis, he added. “But what is more important is that the central bank has reduced CRR rate, which will help banks meet the liquidity crisis to a large extent,” said Mirza Azizul Islam. In a recent circular, BB has re-fixed the CRR at 5.5 per cent for commercial banks on bi-weekly average basis from 6.5 per cent. The government has also taken a decision to allow state agencies to deposit 50 per cent of their funds to deposit in private banks, up from the ceiling of 25 per cent, to tackle the liquidity crisis in the sector. Bankers highly appreciated decisions on CRR and deposit of the funds of state agencies to private banks but said it will take time to bring down the interest rate to single digit.
Agent banking most useful for financial inclusion: analysts
Agent banking is the most useful channel when it comes to providing financial services to the extreme poor, speakers told a national seminar at Amari Dhaka yesterday. Development entities such as non-government organisations and micro-finance institutions (MFIs) are working to link clients with agent banking to provide better financial services, said Tania Sharmin, national technical co-coordinator of CARE Bangladesh. The MFIs can work as agencies of banks in localities for greater financial inclusion, she proposed while addressing a panel discussion titled “Market system approach for financial inclusion of the extreme poor”. Collateral is the major challenge faced when the rural poor try to get loans, so agents of banks, MFIs in this case, can act as guarantors inside localities, helping to provide loans at low interest, she said. Working as a bank’s agent, CARE Bangladesh disbursed around Tk 1.60 crore in loans through a card usable for select purposes only, in effectively reducing borrowers’ non-business expenses, said Sharmin in a presentation. Bangladesh Bank data shows that the number of agent banking accounts more than doubled to 12.14 lakh in 2017 from that a year earlier. Of those, 62 percent were with Dutch-Bank Bank.
Govt to levy tax on dividend only once
National Board of Revenue (NBR) chairman Mosharraf Hossain Bhuiyan Sunday said simplification of the relevant process is on to ensure that any dividend income is taxed only once. The NBR is trying to find out a formula to avoid taxation of dividends that are transferred by the main or principal companies to their subsidiaries, said Mr. Bhuyian at a pre-budget meeting with the Metropolitan Chamber of Commerce and Industry (MCCI) at the Board premises. Currently, tax is levied on dividend at every stage of distribution or transfer. He hinted at the possible changes in relation to dividend taxation in the upcoming budget following a proposal mooted by the MCCI’s tariff and taxation subcommittee chairman Hasan Mahmood. In the meeting, the MCCI leaders proposed withdrawal of the provision of penalising an employer for non-submission of income tax return by an employee, withdrawal of the provisions of disallowances of perquisite paid to an employee in excess of Tk 4,75,000, increase in allowable expenses on royalty, technical knowhow etc from 8.0 per cent of disclosed profit to the actual account as certified by the invoice for the purchase of the relevant term, or at least 6.0 per cent of turnover as prescribed by Bangladesh Investment Development Authority (BIDA) and foreign exchange regulations of Bangladesh Bank (BB).
India to provide Tk 640m grant for three projects
The government of India will provide around Tk 640 million as grant to Bangladesh for the implementation of three small projects related to primary education, CHT region and road infrastructures, reports BSS. “India will provide Tk 640 million grant assistance to Bangladesh against three projects and the grant agreements are likely to be signed on Monday (today),” an official at the Economic Relations Division (ERD) told BSS on Sunday. The official said that ERD Secretary Kazi Shofiqul Azam and Indian High Commissioner Harsh Vardhan Shringla are likely to ink the instruments at the State Guest House Padma in the capital. Of the amount, Tk 250 million will be utilised for a project titled ‘Establishment of computer and language labs in 509 primary schools in Bangladesh’ under which computers, necessary accessories and furniture would be provided to the selected schools, said the ERD official. And Tk 139.2 million Indian grant will be utilised for the ‘Setting up of Chattogram Hill Tracts community complex’ project under which a complex would be built in Rangamati, having an institute and an auditorium. Besides, the Indian government will provide Tk 250 million for the ‘Rehabilitation and improvement of different roads under Rangpur City Corporation’ project to improve the road infrastructures.
Industries sector driving record GDP growth
Standing on the shoulders of the country’s industries sector, Bangladesh is on the verge of achieving a new record in GDP growth for Fiscal Year (FY) 2017-18. According to Bangladesh Bureau of Statistics (BBS) data, Bangladesh will achieve a GDP growth of 7.65% in the current FY, exceeding an earlier prediction of 7.4%. The data also confirmed that the industries sector is the key driver of this projected growth. On Tuesday, Planning Minister AHM Mustafa Kamal highlighted the growth in the industries sector during at a meeting of the Executive Committee of the National Economic Council (Ecnec). The growth of the industries sector for this fiscal has been predicted to be 11.99%, according to data presented by the minister at the meeting. BBS data show that the industries sector had witnessed 10.22% growth the previous fiscal year.
Bangladesh faces stiffest tariff in US
Bangladesh pays the highest import duties out of all the 232 exporting nations to the US because of its substantial trade in apparel and footwear — items that the US generally taxes highly. Pew Research Centre, a Washington-based think-tank, analysed data from the US International Trade Commission and found that Bangladesh faces the highest import duties. “Nearly all Bangladeshi imports were subject to US duty and the tariffs on them were 15.2 percent of the total value of the country’s shipments to the US — the highest such average rate among the 232 countries, territories and other jurisdictions in the ITC database.”
Telcos seek VAT waiver on 4G service revenue sharing
Association of Mobile Telecom Operators of Bangladesh has sought exemption from payment of value-added tax on revenue sharing with Bangladesh Telecommunication Regulatory Commission for 4G services. As per licensing conditions, mobile operators pay 5.5 per cent of their gross revenue as revenue sharing to the government, represented by BTRC. VAT at the rate of 15 per cent is applicable on revenue sharing under 4G (fourth generation mobile technology) licences, said National Board of Revenue officials.
Women entrepreneurs seek three-year tax holiday
The Bangladesh Women Chamber of Commerce and Industry (BWCCI) has proposed granting a three-year tax holiday for the startups run by women while the India-Bangladesh Chamber of Commerce and Industry (IBCCI) suggested reducing corporate tax in the upcoming budget. Representatives of both the organisations made the recommendations during a pre-budget meeting with NBR Chairman Md Mosharraf Hossain Bhuiyan at the NBR conference room in the city on Sunday. The IBCCI also suggested that the NBR (National Board of Revenue) should broaden the tax net but keep the tax rate at a tolerable level in the budget for the 2018-19 fiscal year (FY). It also stressed the need for increasing the flow of foreign direct investment (FDI) for massive industrialisation in the country to turn it into a developed one by 2041.
Tourism industry spurts employments
Employment opportunities in the country’s tourism industry have increased following an expansion of the domestic tourism market, according to a report of the World Travel and Tourism Council (WTTC). According to the WTTC report—‘Travel & Tourism Economic Impact 2017, Bangladesh’—travel and tourism generated 10,57,000 jobs directly in 2016 (1.8% of the total employment) and this is forecast to grow by 1.8% in 2017 to 10,76,000 (1.8% of total employment). This includes employment offered by hotels, travel agents, airlines and other passenger transportation services (excluding commuter services). It also includes, for example, the activities of restaurant and leisure industries directly supported by tourists. By 2027, travel and tourism will account for 11,38,000 jobs directly, an increase of 0.6 per cent over the next ten years. According to tour operators, 50 per cent of these employments will be created centred on Cox’s Bazar and the rest in Dhaka, Chittagong, Sylhet, the Sundarbans in Khulna and Satkhira, and some tourist spots in North Bengal.
Govt to procure 10 lakh tonnes of boro rice this year
The government on Sunday announced that it would procure over 10.5 lakh tonnes of Boro rice this year with the price of paddy at Tk 26 per kg and husked rice at Tk 38 per kg. ‘We have decided to procure 9 lakh tonnes of husked rice and 1.5 lakh tonnes of paddy,’ food minister Md Qamrul Islam told a news briefing after attending a meeting of the food planning and monitoring unit of his ministry at the Secretariat.
ACI launches Premio Plastics and invests BDT 487 million in its subsidiary Premiaflex Plastics
Premiaflex Plastics, a subsidiary of ACI Limited, will manufacture and market household plastic products like furniture and other allied plastic articles. The ACI Limited, the parent company of Premiaflex Plastics and one of the largest business conglomerates in Bangladesh, holds 87.32%stake in the subsidiary. Initial investment in the new company would be BDT 486.88 million with a projected sales target of BDT 1,301 million in 2018-2019, BDT 1,893 million in 2019-2020 and BDT 2,011 million in 2020-21, according to the disclosure. Meanwhile, ACI Limited launched the ACI Premio Plastics at ACI Centre of Tejgaon industrial area in the capital, according to a statement. ACI Premio Plastics has started its journey with 200 premium design and quality home and furniture plastics goods.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 62.31||↑0.25||↑0.40%|
|Crude Oil (Brent)||$ 67.41||↑0.30||↑0.45%|
|Gold Spot||$ 1,332.53||↓0.50||↓0.04%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 83.75|
|GBP 1||BDT 118.02|
|EUR 1||BDT 102.76|
|INR 1||BDT 1.29|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.