Mobile cash jumps 47.0% in January

Transactions through mobile phones rose 47.7% year-on-year to BDT 167.4 billion in January thanks to increased economic activities at the grassroots level, according to Bangladesh Bank data. The amounts were BDT 113.3 billion in January last year and BDT 71.5 billion in the same month of 2014. Average transaction per active account stood at BDT 12,282 in January this year, up from BDT 10,257 in the same month last year. The market for mobile financial services is yet to pick up, and the banking regulator is unhappy with the current transaction patterns, most of them being cash-in or cash-out transactions. In the last few years, low-income people started taking part in economic activities seriously, which resulted in a rise in the volume of mobile transactions, said Subhankar Saha, executive director of the BB. Person-to-person transaction, salary disbursement and utility bill payments are not increasing much, revealing how immature the sector still is, said Saha, who is also the spo kesperson for the central bank. In January, cash-in transaction volume was BDT 69.7 billion, about 41.6% of the total transactions, while cash-out transactions were BDT 61.3 billion or 36.6% of the total.

Source: http://www.thedailystar.net/business/mobile-cash-jumps-47pc-january-1200265

Balance of Payments surplus widens 58.0%

The balance of payments surplus widened about 58.0% in the first seven months of the fiscal year from a year earlier on the back of less spending on petroleum and reduced trade credit for imports. At the end of January, the overall surplus stood at USD 2.7 billion in con trast to USD 1.7 billion a year earlier, according to central bank statistics. The surplus increased mainly due to slower growth in import compared to exports in the first seven months of fiscal 2015-16. In the same period, exports grew 7.11% and imports 6.73%. Typically, Bangladesh spends a large sum on petroleum imports every year. But this fiscal year, petroleum imports dropped almost 30% year-on-year in the first seven months, according to LC settlement statistics. Another cause for the slowing import is the continued sluggish trend in the manufacturing sector, as reflected in raw material imports, which increased only 2% during the period.

Source: http://www.thedailystar.net/business/bop-surplus-widens-58pc-1200259

Dividend payments by state entities to come under legal framework

The government has initiated a move to bring the payment of dividends/profits by the state-owned entities under a legal framework with the objective of boosting its revenue income, officials said. The ministry of finance (MoF) is now attaching utmost importance to the issue, they said. Dividend/profit is an amount that is fixed every fiscal for each state-owned entity on the basis of its operating profit/surplus. Currently, there is no particular clause in the charters of most of the agencies about payment of dividends/profits to the government exchequer. This deprives the government of a satisfactory amount of revenue, a high official of the MoF said. It is observed that a good number of state entities are reluctant to give dividends this fiscal year as they are paying corporate tax, he said.

Source: http://print.thefinancialexpress-bd.com/2016/03/25/137447

National Board of Revenue (NBR) won’t lower 15.0% uniform tax rate in new VAT law

The revenue board is unlikely to lower the 15% uniform tax rate in the new VAT law despite oft-repeated demand of the business community to bring down the rate to single digit. “The NBR is going to implement the new VAT and Supplementary Duty Act-2012 from July 01, 2016. By that time, there will be no plan to change anything incorporated in the law,’ National Board of Revenue (NBR) chief Nojibur Rahman said Thursd ay. The NBR chairman told this while speaking to newsmen after a luncheon meeting of the Foreign Investors’ Chamber of Commerce and Industry (FICCI) at a city hotel Thursday. He said the revenue board is framing a transition plan for next three months before the implementation of the new VAT law. The NBR will monitor the required changes and give special attention to implementation of the new law by replacing existing VAT law, he added. The finance minister and the NBR chairman will hold meeting with the stakeholders including the apex chamber and other trade bodies before finalizing the transition plan, he said.

Source:
http://print.thefinancialexpress-bd.com/2016/03/25/137437
http://www.thedailystar.net/business/new-vat-law-remain-unchanged-nbr-chief-1199170
http://newagebd.net/214780/nbr-chairman-rules-out-changing-uniform-vat-rate-of-15pc/

Bangladesh Association of Pharmaceutical Industries against NBR move to hike raw material duty

Bangladesh Association of Pharmaceutical Industries has taken stance against the National Board of Revenue’s move of increasing customs duty on import of a raw material used in producing essential antibiotic medicines. BAPI, the association of drug manufacturers, has recently demanded that the revenue board rather reduce duty on import of the pharmaceutical ingredient— azithromycin dehydrate— used in producing antibiotics. The Compiled by: Research & Development Unit, Dhaka Bank Limited association claimed that the quality of the raw material produced by a local company was not parallel to the latest international standards. Currently, 10% customs duty is applicable on import of the item. The company– Active Fine Chemicals Ltd– will also not be able to meet the demand of the local drug manufacturers, it said in a letter sent to NBR chairman Md Nojibur Rahman on February 15. The current demand of the item is 95 metric tons while the production capacity of the company is only 9 metric tons, it said.

Source: http://newagebd.net/214792/pharma-assoc-against-nbr-move-to-hike-raw-material-duty/

Construction sector sluggish despite props

Despite having a favorable environment, the country’s construction industry could not make a turnaround to its previous state even in a year and is still struggling. Prices of all construction materials remained within people’s purchasing capacity for a long period and low-cost financing was also available but their sales are continuing to see a bearish trend. However, Real Estate and Housing Association of Bangladesh (REHAB) vice president Liakat Ali Bhuiyan said sales of flats and plots are increasing slightly. Some businessmen have blamed siphoning off of a significant amount of money from Bangladesh for low investment in construction and real estate sector. According to the central bank data, presently the average rate of interest of bank loans for housing sector hovers between 9.0% and 16%. The weighted average rate of interest for loans for apartment purchase is 9.93%. Besides, good borrowers are given 10% rebate on interest rate of loans. According to officials, the government late last year introduced housing loans for non-resident Bangladeshis and migrant workers on 50-50 ratio to inject fund flow into the sector. Besides, the banks are allowed to provide as high as BDT 1.20 billion as loans for housing under consumer financing schemes.

Source: http://print.thefinancialexpress-bd.com/2016/03/26/137518

Yarn makers benefit from falling cotton prices

Yarn market in Bangladesh remained stable in the last one year thanks to the declining cotton prices worldwide, industry people said. Each kilogram of the widely consumed 30-carded yarn was sold at between USD 2.60 and USD 2.70 yesterday in local markets and the price was almost the same in the last one year. Cotton traded between 54 cents and 55 cents a pound yesterday in international futures markets. The price of a pound of the white fibre was between 60 cents and 64 cents four months ago. “The domestic yarn market is stable now as the cotton prices declined worldwide,” said Momin Mondol, managing director of Mondol Group, one of the leading garment exporters of Bangladesh. About a year ago, cotton was traded at nearly USD 1.0 a pound in the global market when yarn was sold for USD 3.3 to USD 3.4 a kg in Bangladesh. “However, yarn prices declined now and we have received ample work orders from international retailers,” said Mondol, who exported USD 273.0 million worth of garments, mainly knitwear items, in 2015.

Source: http://www.thedailystar.net/business/yarn-makers-benefit-falling-cotton-prices-1199191

Bangladesh refiners pocket windfall profits despite international oil woes

When many an oil-and-gas company in the USA and other parts of the world went bankrupt, a dozen private refineries in Bangladesh made windfall profits from their fuel sale to a captive customer, market analysts said. The selling rates of these fortunate business firms to the state-run Bangladesh Petroleum Corporation (BPC) remained unchanged at high level for over a year, as of 2015, although global oil prices hit rock bottom. Economists are of the view that people have to pay the price for the profits the companies pocket as the BPC passes on the agreed procurement cost to the members of the public under such a marketing policy. The prices of natural condensate used as raw material by the refineries owned by private entrepreneurs also dropped drastically apace with fuel prices on the international market. The market fall started in the middle of 2014. As of Thursday in the past week, the prices of condensate stood at USD41 a barrel on the international market and Bangladesh’s domestic market. The Petrobangla is the marketing authority of the liquid hydrocarbon. The rate was more than USD 100.0 a barrel in 2014 and then it went on a climb-down, ultimately crashing below USD 35.0 a barrel.

Source: http://print.thefinancialexpress-bd.com/2016/03/26/137525

Land scarcity forces Reliance to downsize power project

Indian conglomerate Reliance Group will now set up a 750-mega-watt gas-fired power plant instead of 3,000mw it originally planned due to land constraint. On the other hand, another Indian firm Adani Group will set up a 3,000-mw power plant in India and sell its electricity to Bangladesh instead of its previous offer for setting up 1,600-mw coal-fired power plants in Bangladesh, reports UNB. According to the latest development, official sources said the Reliance Group will set up its 750-mw LNG-based power plant in Meghnaghat and set up a floating storage and re-gasification unit (FSRU) at Moheshkhali to import gas to supply to its own plant. “Actually, Reliance’s initial proposal was to set up 3,000-mw LNG-fired power plant. Such a gigantic project needs a big tract of land, which is not available with the government right now,” said an official at the Power Division. He said there is only one piece of land available at Meghnaghat near Dhaka to house the 750-mw power plant.

Source: http://print.thefinancialexpress-bd.com/2016/03/26/137528

Dutch shows interest in Paira port project

The Netherlands has expressed its interest in Paira port project in line with the government initiative to build a deep seaport at Paira in Patuakhali. Bangladesh Ambassador to the Netherlands, Sheikh Mohammad Belal, recently told the Dhaka Tribune that the issue had been discussed when Prime Minister Sheikh Hasina visited the Hague last year. “The prime minister [Hasina] noted the Dutch interest in deep seaport projects and assured the Dutch side of her government’s due consideration for the port project propositions,” he said. The ambassador said the Dutch companies have considerable interests in different sectors of Bangladesh including water resources management, i.e. waste water treatment, dredging, etc, port development, agriculture, textiles and leather, ICT, mobile telecommunication and energy.

Source: http://www.dhakatribune.com/business/2016/mar/25/dutch-shows-interest-paira-port-project#sthash.hnpCXYtR.dpuf

Three mobile operators see 69.0% rise in data revenue

Data revenue of three mobile operators — Grameenphone, Banglalink and Robi — increased about 69.0% year-on-year to BDT 16.9 billion in 2015. Income from data business of the three operators, which have a combined market share of around 90.0%, got a boost with the launch of 3G services two years back. Around 10.0% of their revenue came from data services in 2015, up from 5.0% in 2014 and 2.0% in 2013. Data revenue information of three other operators — Teletalk, Airtel and Citycell — is not publicly available. Of these three, Teletalk and Airtel offer 3G services. Grameenphone’s data revenue is growing fast due to heavy investment in 3G technologies, a rise in the number of subscribers and increased smartphone penetration, said Nehal Ahmed, director for communications of the operator. Average data consumption per user incr eased over time, fuelled by access to a wide range of digital lifestyle solutions, social media and other applications, he added. In 2015, Grameenphone saw BDT 104.8 billion in revenue, and BDT 8.5 billion of the amount came from data revenue, according to its financial statement.

Source: http://www.thedailystar.net/business/telecom/three-mobile-operators-see-69pc-rise-data-revenue-1199200
Source: http://print.thefinancialexpress-bd.com/2016/03/23/137273

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