Government finally cuts oil prices
The government cautiously cut prices of major petroleum products, ranging from 4.41% to 10.41%, around two years after the start of global oil slump. As per an executive order issued Sunday by the Ministry of Power, Energy and Mineral Resources (MoPEMR) the downward adjustment applies to pump prices of diesel, kerosene, petrol and octane. The prices of octane and petrol have been lowered by BDT 10 per liter to BDT 89 per liter and BDT 86 per liter respectively. The price of diesel and kerosene has been cut by BDT 3.0 each to BDT 65 per liter. But the price of furnace oil, which was reduced by BDT 18 to BDT 42 per liter on March 31, remained unchanged. “The new prices will take effect after midnight on Sunday,” says the gazette notification. The government last made changes to prices of these petroleum products on January 04, 2013 when it raised the rates up to 11.47% to offset the losses being incurred by the BPC back then.
Power tariff hike likely again
Government’s power entities have moved again to raise power tariffs despite a drastic fall in electricity generation and supply costs following global oil slump, officials said. People are already paying high prices due to previous raise in the electricity tariff rates, said critics, who see little logic behind the fresh move on the back of cuts in oil prices. The average electricity-supply costs, which include generation and transmission expenses, of the state-run power entities have fallen by around 13.6% to BDT 5.40 per unit (one-kilowatt hour) over the past one year due to sharp fall in oil prices on the international market, said an industry expert involved with analyzing tariff structure. He sees chances of the cost going down further to around BDT 5.20 per unit from next fiscal year (FY) 2017 following the cut in furnace-oil price on the domestic market. The average electricity-supply cost of the power-distribution companies was BDT 6.25 per unit during FY2015. Currently around 3,300 megawatts (MW), or 44.0% of the country’s overall electricity generation of around 7,500 MWs, are generated through oil-fired power plants.
New entity to pay BDT 5.0 billion for using Airtel’s spectrum
The new entity after the merger of Robi and Airtel will have to pay more than BDT 5.0 billion in fees for using Airtel’s existing spectrum in the 1800 band, according to a proposal of the telecom division. Additional charges and fees were also proposed for the merger. The recommendations that are currently under the consideration of the prime minister, who is also the line minister for telecom, seek additional payments to adjust the spectrum prices with those in 2011, a senior official of the telecom division said. The Prime Minister’s Office may apprise the High Court of a decision on June 2. Airtel, for BDT 3.4 billion, bought 15 MHz spectrum in the 1800 band for fifteen years in 2005. This translates to BDT 15.1 million per MHz per year in spectrum price for the license duration. However, Robi and other operators got spectrum for a higher average price in 2011 — BDT 1.5 million for 15 years — meaning per MHz spectrum price a year was BDT 100.0 million. “Now if the merged entity wants to retain this spectrum, it will have to pay the rest to match the price of 2011,” the official of the telecom division said, asking not to be named.
Ceramic lobbyist group pushes for continuing protection
Ceramic wares manufacturers have proposed the tax authority to continue protecting the local industry in the forthcoming budget to help them sustain. The Bangladesh Ceramic Wares Manufacturers Association (BCWMA) and Bangladesh Beverage Manufacturers Association (BBMA) demanded that the government continue 60% supplementary duty on import of tiles, table wares and sanitary wares in the new law. The Value Added Tax and Supplementary Duty Act will be enforced from July 1, 2016. The ceramic wares manufacturers also demanded checking the under-invoicing on import of finished ceramic wares, saying it causes uneven playing field for local manufacturers. The association leaders made the plea at a pre-budget meeting with the National Board of Revenue (NBR) at its office Sunday. NBR member (VAT policy) Jahangir Hossain, who chaired the meeting, said the authority will continue nominal protection for local industries, although effective rate of protection is still high.
Summit subsidiary starts power production for Barisal region
Summit Barisal Power Ltd (SBPL) has started supplying around 110.0 megawatts (MW) of electricity to the national grid to meet the staggering demand for electricity in the southern region, the company said. The commercial operation date of the plant was on April 5, two months ahead of the proposed schedule as per the contract signed between the state-owned Bangladesh Power Development Board (BPDB) and the SBPL. SBPL, an independent power producer (IPP), is located on the northeastern bank of Kirtonkhola River in Barisal and equipped with seven latest and highly-efficient heavy fuel oil (HFO) engines made by Wartsila Finland, the company said in a statement. Summit Oil and Shipping Company Limited (SOSCL) will import and supply the fuel for the plant. A 7,000 ton on-site capacity storage tank facility has been constructed to store HFO, which will be sufficient to run the plant for 15 days at a stretch, the company statement added. The fuel would be unloaded to the plant’s own jetty constructed by SOSCL adjacent to the plant.
Economists fret over shortage of farm laborers
Shortage of laborers, decline in arable land and water sources and changing climatic condition are holding back the desired growth of the country’s agriculture sector, economists said Sunday. The observations came at a working session titled ‘Revisiting the Role of Agriculture’ of the concluding day of the two-day long ‘Critical Conversation 2016: The Bangladesh Journey,’ organized by state think-tank Bangladesh Institute of Development Studies (BIDS) in the city. Research Director at BIDS Dr Rushidan Islam Rahman presented the key-note, which revealed that agricultural growth contributes to poverty reduction and employment generation, while higher agricultural income has generated demand for non-farm consumption goods. “Wage of farm laborers increased, unemployment in both urban and rural areas declined”, it said. The paper showed farm laborers now comprise 45.0% of the total workforce, which was more than 60.0% a decade back.
Suppliers’ reforms progressing: H&M
Remediation in factories from which Swedish retail giant H&M sources has progressed significantly, the company said in a statement. H&M, which is the largest apparel buyer from Bangladesh, purchases about USD 5 billion of products annually from 255 factories. Remediation was initially delayed, partly due to import delays of upgraded safety equipment as well as a shortage of technical expertise needed to conduct detailed engineering assessments, planning and submissions of drawings and installation of technical equipment. “However, now the remediation is showing progress,” H&M said, adding that it is now working closely with Industrial, a global union federation, to further speed up the process. As of March 31, all locking features as well as collapsible, rolling shutter and sliding doors have been removed from the factories. Some 46 factories have installed new upgraded fire doors at every exit, enabling a safe evacuation.
World Stock and Commodities
|Index Name||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)*||$43.11||(0.62)||(1.42%)|
|Crude Oil (Brent)*||$44.61||(0.5)||(1.11%)|
|Dow Jones Industrial Average||18,003.75||+21.23||+0.12%|
|USD 1||BDT 78.41*|
|GBP 1||BDT 113.15*|
|EUR 1||BDT 88.14*|
|INR 1||BDT 1.18*|
*Currencies and Commodities are taken from Bloomberg.