Import bill payment in March surged by 20.46 per cent year-on-year due to a rise in payment of bills for food products imported to meet up demand in the upcoming Ramadan, the fasting month for Muslims. According to the latest Bangladesh Bank data, the total import bill payment stood at $3.74 billion in March this year from $3.10 billion in the corresponding month of 2016. A BB official told New Age on Sunday that businesspeople had increased imports of certain food products in March ahead of Ramadan. The businesspeople are now also importing industrial raw materials as political uncertainty in the country eased significantly in the recent months.
MFS transaction limits taking toll on SMEs, e-commerce
On January 11 this year, Bangladesh Bank issued an order to all mobile financial service providers to comply with the revised mobile banking transaction ceiling, citing abuse of the facility by a section of people. This limitation of the mobile financial service (MFS) transactions has now started taking a toll on users, especially SMEs and small e-commerce entrepreneurs. According to the directive, a maximum of BDT 15,000 can be deposited into an MFS account and BDT 10,000 can be taken out each day. The previous daily ceiling was BDT 25,000 both for cash-in and cash out. An account holder can now make deposits and withdraw amounts twice in a day. Previously, the limit for cash-in was five and for cash-out it was five. Each month, a mobile money customer can deposit a maximum of BDT 100,000, down from BDT 150,000 earlier. The maximum monthly withdrawal limit is BDT 50,000 through 10 transactions at most. Previously, the cash-out limit was BDT 25,000 per transaction and three transactions were allowed at most. The overall cash-out limit used to be BDT 150,000 in 10 transactions a month. The customer also cannot withdraw more than BDT 5,000 within 24 hours after a deposit. To withdraw cash of BDT 5,000 and over, the customer must first show proper verification – national identity card or its photocopy – to the mobile banking agent. Several MFS account holders are now using different SIMs to conduct transactions, leading to an increase in the number of MFS accounts this month. According to a central bank report, though the total number of registered MFS accounts has increased by 18.89% and the number of active MFS accounts has risen by 44.85% to 23.9m in February in comparison with the previous month, however, the total number of MFS transactions has actually dropped by 11.42%.
India relaxes loan conditions for Bangladesh: Finance Minister
The Indian government has relaxed loan conditions for Bangladesh, Finance Minister AMA Muhith has said, reports bdnews24.com. Earlier, Bangladesh had to purchase from India with 75% of the credit, but now the amount has been cut to 65%. In the first phase of the line of credit from India, Bangladesh received USD1.0 billion with 1.7% interest. India cut the rate to 1.0% in the second phase when it gave Bangladesh USD2.0 billion during Prime Minister Narendra Modi’s Dhaka visit in 2015. The rate remained same when the two countries signed USD4.5 billion credit deals during Prime Minister Sheikh Hasina’s recent visit to New Delhi. Muhith spoke about the matter after meeting his Indian counterpart Arun Jaitley on the sidelines of the Spring Meeting of the World Bank Group – IMF. Muhith quoted Jaitley as saying, “The relation between the two countries is very good now. Only one issue has remained unsettled – the water-sharing of the Teesta river. Our prime minister (Modi) has said it would also be resolved. And I am also saying it will be resolved soon.” An agreement on Teesta was not expected during the current visit by PM Hasina, but officials in the Modi government are working closely with West Bengal officials to find common ground to get Chief Minister Mamata Banerjee to agree to the deal that was first worked out during former PM Manmohan Singh’s visit to Dhaka.
NBR Chairman Md Nojibur Rahman has said the upcoming budget would be pro-people and investment-friendly. “The budget is going to be more business-friendly. This time it will be production-oriented as well,” the NBR chief said while addressing a pre-budget meeting with the Chittagong Chamber of Commerce and Industry (CCCI) on Sunday. The CCCI organised the view-exchange meeting at Bangabandhu Conference Hall of World Trade Centre in the city. “We have received a number of directives from Prime Minister Sheikh Hasina for the upcoming budget. We would like to assure you that the forthcoming budget will protect local industries,” Nojibur said, adding that they would continue to give incentives to the export-oriented industries. The revenue boss noted that the upcoming budget would specially focus on generating employment in the country. Referring to the new VAT law which is going to be effective from July 1, he said it would be much more business and investment-friendly. “Now we are making a list of tax waiver. The new VAT law will be implemented protecting the interest of general people. With the implantation of new law, there will be scope of giving incentives to different sectors,” said the NBR Chairman. “There are some flaws in the VAT Act 1991. The new Vat law will be online-based,” said Nojibur. Replacing the existing VAT Act 1991, the VAT and Supplementary Duty Act 2012 has been framed at the prescription of the International Monetary Fund (IMF). The new VAT law envisages a flat 15% value added tax rate, replacing different VAT rates now in force for goods and services. While placing recommendations for the national budget for Fiscal Year 2016-17, Mahbubul Alam, on behalf of the CCCI, proposed to fix the Vat rate at between 7%-10%.
The National Board of Revenue (NBR) has been thinking to launch a mobile app in line with a proposal by the business people to collect VAT. “We’re seriously thinking to launch a mobile app to collect VAT,” said NBR Chairman Md Nojibur Rahman while speaking at the opening session of a workshop on Value Added Tax (VAT) and income tax on Saturday.
Government to import power from Indian company at higher price
The government is going to import electricity from an Indian company at higher price than that of local one, officials said. The 1600 MW coal-based power plant, owned by Adani Power Ltd located at Jharkhand in India, proposed supplying electricity to the power division at BDT 6.89016 per kilowatt hour (kWh). S. Alam Power Plant has proposed the rate at BDT 6.6045 per kWh. But Adani Power Ltd said installation of 90-kilometre transmission line and corporate taxes will increase their capital expenditures than that of the local company. The duration for supplying electricity by Adani Power Ltd will be for 25 years. As part of the move, the cabinet committee on public purchase in its April 26 meeting is going to give approval to the proposal made by the power division for electricity import from Adani Power Ltd. Adani Power Ltd on February 18, 2016 sent a comprehensive techno-commercial proposal to the power division of Bangladesh for supplying electricity from its power plant. Bangladesh and India signed a memorandum of understanding (MoU) on January 11, 2010 for cooperation in the power sector. Bangladesh Power Development Board (BPDB) signed a MoU with Adani Power Ltd on August 11, 2015 for building a dedicated transmission line from Jharkhand to Bangladesh frontier.
The Directorate General of Drug Administration (DGDA) Sunday fixed the coronary stent prices of 37 brands imported by 15 companies. The number of brands was increased from 26 to 37 in the 3rd expert committee meeting, with director general Major General Mustafizur Rahman in the chair. The prices of 26 brands were fixed earlier in a meeting on Wednesday last. Earlier, the importers and hospitals allegedly used to fix the prices of stents according to their whims. A 17-member committee of experts was formed by DGDA to fix the stent prices and, curb the existing unwanted situation and ‘commission business’ while freeing the patients from fraudulent practices adopted by the stent ‘syndicates.’ At present, 21 firms import 47 brands of stents. A list showing the prices of different brands of stents will have to be displayed at every government and private hospitals with immediate effect. In the meeting Sunday, the mark-up prices were reviewed and various proposals came to review the present markup — cost plus 55.0% margin. The stent prices have been fixed as per the mark-up fixed in 2012, a member of the committee told the FE. Once the mark-up is revised, the stent prices will go down further, he added. Although the present prices seemed to be logical as per the invoice price presented by the importers, he said, there were allegations of miscalculation and over-invoicing.
RMG sector future hinges on better worker-owner ties
Speakers at a dialogue in the capital on Sunday pressed for improving relation between the workers and the factory owners as well as ensuring fairness in the supply chain for a sustainable readymade garment (RMG) sector. Experts, diplomats, employers and workers’ representatives at the dialogue titled “Catalyzing Social Dialogue in the RMG Sector of Bangladesh” also emphasised good governance, ensuring workers’ rights including freedom of association, and implementation of labour act in the export processing zones (EPZs). Their recommendations also included ensuring job for the Rana Plaza survivors, follow up treatment of the injured workers, getting fair prices of apparel products, and launching social dialogue in the sourcing countries.
50pc garment units yet to come under safety efforts
AROUND 50 per cent of the readymade garment factories in the country still remain under safety risk as nearly 2,200 units are yet to undergo either any remediation work or safety assessment. Following the 2013 Rana Plaza building collapse that killed more than 1,100 people, mostly garment workers, European retailers formed the Accord on Fire and Building Safety in Bangladesh while North American retailers instituted the Alliance for Bangladesh Workers Safety and the initiatives launched safety inspections at more than 2,300 RMG factories in Bangladesh. At the same time, the government in association with the International Labour Organisation launched a separate inspection programme for the rest of the garment factories which were not on the lists of the Alliance and the Accord. The government-ILO initiative completed its initial safety assessment at 1,549 export-oriented readymade garment factories on November 10, 2015 but the initiative has failed to start remediation work at the units in one and a half years.
Grameenphone Ltd has earned 64.9% growth in data revenue while its voice revenue grew by 7.1% for the first quarter of 2017. The operator reported a revenue of BDT 30.6 billion, an 11.1% growth from the same period last year, Grameenphone said at a press release. The operator disclosed the Q1 financial report on Sunday. In his statement, GP CEO Petter Furberg said the company passed a good quarter with healthy performance to start the year. The market leader of telecom business ended the quarter with 59.9 million active subscribers, registering a 3.3% growth from last quarter. The company also acquired 0.7 million internet users during the period, taking the quarter-end base to 25.2 million. With this, 42.2% of total subscribers are using Grameenphone internet services. According to Dilip Pal, CFO of Grameenphone, the phone company reported healthy earnings driven by top-line growth and operational efficiency initiatives. GP invested BDT 4.5 billion during the quarter for 3G as well 2G coverage expansion and capacity enhancement of voice. It added 238 2G and 776 3G sites, taking the cumulative site numbers to 12,222 for 2G and 11,332 for 3G. With this, the company is covering more than 99% population for 2G and more than 91% for 3G. During the quarter, the company contributed to exchequer BDT 11.8 billion.
S Alam Group to buy 20 ships from Western Marine Shipyard at BDT 2.5 billion
Chittagong-based S Alam Group will buy 20 ships from Western Marine Shipyard at BDT 2.5 billion. Evergreen Shipping, a concern of S Alam Group, signed a deal with WMS in February this year. Yesterday WMS started the construction through a keel-laying ceremony at its shipyard in Patiya upazila of Chittagong. As per the contract, the ships will be delivered within the years. The movement of essential goods through river routes will be cost effective and benefit consumers, he said. The vessels will be built under the supervision of Norwegian-German classification society DNV-GL to ensure global standard. Each ship will be 60.6 meters in length and weigh 1,500 deadweight tonnage. The deal is considered one of the biggest in the country’s shipbuilding history in terms of number of ships being built concurrently, according to WMS officials.
Lack of quality data hinders gauging growth ‘potentials’
The poor quality of data and absence of essential data were the major impediments to estimating growth potentials for formulating policy for higher growth, speakers said Sunday. They said that Bangladesh’s economy performs well below the potential due to structural impediments and proper policy formulation.
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