BB wants out-of-court settlement too
Dhaka is likely to propose an out-of-court settlement, in a major policy shift, for the recovery of the rest $66 million of the country’s stolen reserve fund from Manila. Officials, quoting a latest position paper of the Bangladesh Bank, said that finance minister AMA Muhith at a meeting with his Philippine counterpart scheduled for today would urge the Philippine government to ‘consider possibilities of an out-of-court settlement with agencies and individuals concerned.
Expats send over $1.2b in remittance in April
The country received $1.218 billion in remittance from April 1 to 27 this year, reports UNB. In March, the total inward remittance was $1.299 billion. Bangladesh Bank officials said the data on remittance of three other days of last month (April 28-30) is not available. Once the data is available, the total amount will obviously increase from $1.218 billion. Bangladesh Bank’s available statistics show six state-owned commercial banks – Agrani, Janata, Rupali, Sonali, BASIC and BDBL – received $299.91 million from expatriate Bangladeshis while two state-owned specialised banks – BKB and RAKUB – received $10.51 million. The maximum remittance came through private commercial banks as they received $895 million and the nine foreign banks $12.95 million. Among the private commercial banks, Islami Bank Bangladesh Limited (IBBL) topped the chart as it received $248.97 million, followed by Dutch-Bangla Bank’s $62.08 million.
Capital machinery imports refuse to slow down
Capital machinery imports continue to soar amid concerns of money laundering by way of over- and under-invoicing centring on the national elections, due to be held at the end of the year. In the first eight months of the fiscal year, import orders for capital machinery soared 30.36 percent year-on-year to $4.42 billion, according to data from the Bangladesh Bank. Capital machinery imports enjoy zero to 7.5 percent tariff depending on the industries and the location of the factory. Typically, in an election year, businesses hold off from making a fresh investment because of the uncertainty, so capital machinery imports should not increase. Furthermore, private investment to GDP ratio is stagnant, according to AB Mirza Azizul Islam, a former finance adviser to a caretaker government. Hence, he suspects money laundering by exploiting the zero tariff facility for capital machinery. Money laundering usually increases in an election year, said Syed Mahbubur Rahman, managing director of Dhaka Bank. “But it is difficult to say if instances of money laundering marked a rise in recent months. If yes, bankers must take the responsibility for it.” He, however, said businesses have recently imported capital machinery to set up new industrial units in the garment, textile, power, and liquefied petroleum gas sectors.
Private credit growth cools down in March
Private sector credit growth finally hit the brakes in March on the back of the central bank’s efforts to curb aggressive lending by banks. In March, the credit growth stood at 17.93 percent, down 0.56 percentage points from the previous month, according to data from the central bank. The growth though was higher than the central bank’s target of 16.3 percent set for the second half of fiscal 2017-18. At the end of March, the total outstanding private sector credit was Tk 8.71 lakh crore. Banks have tightened their credit activities to bring down the loan-deposit ratio to lower than 85 percent as per the central bank’s directive, said Faruq Mainuddin Ahmed, managing director of Trust Bank. “But we got here in the first place because banks had lent beyond their limit. This prompted the central bank to fire off the directive.” Following the Bangladesh Bank directive, banks that lent aggressively calmed down, which resulted in the decline in credit growth, he added.
Govt to review savings tools interest rate: Muhith
Finance minister AMA Muhith on Sunday said that the government was considering reducing interest rate of the national saving certificates. He also hinted at cutting the corporate tax rate during a pre-budget discussion with the leaders of Dhaka Chamber of Commerce and Industries at secretariat. Led by president Abul Kasem Khan, DCCI placed before the minister a number of demands including cut in corporate tax rate to up to 25 per cent from the present highest rate of 45 per cent, borrowing facility at single digit interest rate and higher allocations for research and development and export diversification. Muhith said that change in the corporate tax rate could be expected in the new budget. He, however, did not say how much rate would be cut.
Loss in Farm Loan Disbursement: RAKUB seeks Tk 224cr as compensation
Rajshahi Krishi Unnayan Bank (Rakub) has sought compensation of Tk 224 crore from the government for incurring losses from disbursing farm loans at the interest rate set by the Bangladesh Bank. The state-run specialised lender said it had incurred huge losses from fiscal 2013-14 to fiscal 2017-18 as the central bank had slashed the interest rate on farm loans several times. Huge competition now prevails among private banks over funds, which has compelled the specialised bank to collect the deposit at rates as high as 8.50 percent, it said in a letter to the finance ministry on March 3. But, the bank has to disburse farm loans at 9 percent interest rate in line with the central bank’s instruction. The finance ministry forwarded the Rakub’s proposal to the central bank for vetting. A BB official, however, described the demand as illogical as the interest rate on farm loan is still lower than the weighted average rate for lending set by the state and private lenders.
City Bank to expand Amex card service this year
Dhaka Bank City Bank, the lone franchise of American Express (Amex) cards in Bangladesh, aims to expand the credit card service across the country within this year, a senior official of the bank said. “We are working to spread the Amex card business in every district of the country within this year to help facilitate our clients’ day-to-day financial transactions,” Additional Managing Director (AMD) of the bank Mashrur Arefin told the FE recently. The bank is also planning to launch several new Amex products, including business to business (B2B) card, in addition to the existing ones, he added. At present, the bank offers Amex Platinum, Gold, GreenBlue, a co-brand credit card in partnership with Agora supershop, and CityMaxx, with the credit ceiling of up to Tk 1.0 million. Bangladesh Bank statistics show that there are 0.95 million (9,53,780) credit card users in the country as of February this year. Of the total users, more than 0.25 million are Amex clients, according to available data with the City Bank, which introduced the service in Bangladesh in November 2009.
ADB, UK launch fund for regional connectivity
The Asian Development Bank (ADB) and the United Kingdom (UK) have launched a new fund to help Bangladesh and other ADB members address the ‘frontier challenges’ the country faces in improving regional integration. The UK through its Department for International Development (DFID) will initially contribute US$ 30 million to the Asia Regional Trade and Connectivity Fund (ARTCF). The multi-country fund will initially focus on eight central and South Asian countries such as Afghanistan, Bangladesh, India, the Kyrgyz Republic, Myanmar, Nepal, Pakistan, and Tajikistan, the Asian lender said in a statement. The fund was launched at an event on Wednesday at the ADB Headquarters in Manila ahead of the annual meeting of the ADB’s Board of Governors, which begins here Thursday.
Businesses falsify e-BINs for tax evasion: VAT office uncovers misdeeds
Field-level VAT offices have discovered false and incomplete information provided to the database of electronic Business Identification Number (e-BIN), thus creating scope for tax evasion. The VAT officials said the immediate action should be taken to clean up the false and fabricated data in the e-BIN to prevent the loss of revenue arrears. More than 0.1 million businesses have so far obtained the e-BIN by entering the online system under the VAT (Value Added Tax) Online Project. Many of the field-level VAT officials, preferring anonymity, said a number of operational problems surfaced owing to the issuance of online nine-digit electronic BIN without verification. The officials raised the issue in a recent meeting at the NBR, chaired by board chairman Md Mosharrof Hossain Bhuiyan.
Thailand keen to invest in large infrastructure projects
Thailand wants to invest in Bangladesh’s large infrastructure projects as part of efforts to boost bilateral trade and economic ties, a top Thai minister said yesterday. Bangladesh needs more power plants, water treatment plants, highways, seaports, airports and new terminals, said Kobsak Pootrakool, a minister attached to Thai Prime Minister’s Office. Pootrakool looks after economic reforms, National Board of Development and economic zones and Board of Investment of Thailand. “We have a good scope to participate in these big infrastructure projects,” he told reporters after a meeting with the officials of Bangladesh Economic Zones Authority (Beza) in Dhaka.
Indian Line of Credit: Priority on completion of projects in election year
With the general elections in Bangladesh slated for later this year, Bangladesh and India are in talks to fast-track implementation of the development projects under the second and third lines of credit totalling seven billion dollars. Before the general elections in India due early next year, the two countries have turned their focus on projects related to power, connectivity and river dredging, sources told The Daily Star. Bangladesh has conveyed to India, through government as well as political channels, the development projects in their list of priority and diplomats of the two countries have stepped up their engagement for this, they said. Indian Foreign Secretary Vijay Gokhale is reported to have called back India’s Ambassador to South Korea, Vikram Doraiswami, to lead the drive to complete as many projects as possible.
Land acquisition process for Araihazar EZ at final stage
The land acquisition process to set up Araihazar Economic Zone (AEZ) in Narayanganj district is now at the final stage, an official said. “We are working on it. We hope we will be able to finalise the land acquisition process for Araihazar Economic Zone shortly,” General Manager Investment Promotion of Bangladesh Economic Zones Authority (BEZA), Md Moniruzzaman, told the FE. Initially, the BEZA earmarked a total of 540.77 acres of land located at Panchrukhi and Panchgaon Mouzas under Araihazar upazila of Narayangaj for the proposed AEZ, dedicated to Japanese entrepreneurs for setting up different types of export-oriented factories. The project (economic zone) will be implemented by BEZA which is under the Prime Minister’s Office (PMO). The financial cost for implementing the first phase of the project is estimated at more than US $145 million ($145,883,747) which will be financed by Japan International Cooperation Agency (JICA).
Four ‘fast-track’ projects of transport sector not ‘on-track’
The four ‘fast-track’ projects of the country’s transport sector have fallen behind their respective completion target due to tardiness in their implementation process, officials said on Wednesday. They said among the total 10 ‘fast-track’ projects, the government has given utmost priority to four transport sector projects. These are — Tk 287.93-billion Padma Bridge construction, Tk 349.88-billion Padma railway link, Tk 219.85-billion Dhaka Mass Rapid Transport (MRT Line-6), and Tk 180.34-billion Dohazari-Ramu-Cox’s Bazar-Ghundum project.
Scanning at Ctg Port: Govt settles for costlier option
Scanning operation is a sensitive job for any port around the world. It examines imports through misdeclaration and the presence of explosives that could jeopardize national security. Once released, there is little scope for reexamining the containers. Yet the Chittagong Custom House (CCH) is relying on private operators for the delicate job as it failed to establish a permanent scanning department of its own to do this. While the government is losing money in the process, it also poses a threat to national security, port sources have said.
Survey on Ethical Compliance in Apparel: Bangladesh tops China, India
Bangladesh overtook China and India in ethical compliance in apparel segment on the back of improved workplace safety following pressure from international inspection and remediation agencies, according to a new survey. “In particular, ethical scores in Bangladesh rose by an average of 15 percent during the past 12 months,” said AsiaInspection in its first quarterly report of 2018 released last month. This was likely reflecting the continuous pressure to improve put on Bangladesh’s textile and apparel manufacturers by the industry groups formed after the Rana Plaza collapse in 2013, it added. Hong Kong-based AsiaInspection is a global leading quality control and compliance service provider that partners with brands, retailers, and importers around the world to secure, manage and optimise their supply chain.
Seven textile cos get increased institutional investment in March
Seven listed companies of textile sector received increased institutional investment in March this year amid their mixed performance displayed during January-March, 2018. The companies are Saiham Textile Mills, Stylecraft, Alif Manufacturing Company, Simtex Industries, Dragon Sweater and Spinning, Paramount Textile and Alltex Industries.
BTCL urges ministry to scrap new int’l call termination rate
Bangladesh Telecommunication Company Limited has urged posts and telecommunications ministry to scrap a Bangladesh Telecommunication Regulatory Commission’s latest directive on international call termination rate. BTRC on February 22 increased international call termination rate thus allowing international gateway operators’ to share lower amount of revenue with the government. As per the notice, IGW operators were allowed to bring international calls at 2.5 US cents (Tk 2 considering the exchange rate) per minute from 2 US cents per minute while operators were asked to share revenue with the government at 1.75 US cents (Tk 1.4) per minute. The state-owned entity issued the letter as it found that the BTRC-set directive was impractical considering the declining volume of international calls through legal channel due to the rise of mobile application base phone calls, an official of BTCL told New Age on Monday.
Edotco to be eligible for tower co licence once Robi sells off its stake: BTRC
Robi Axiata Limited, the second-largest mobile phone operator in the country, will have to offload its stake in edotco so that the latter becomes eligible to get tower sharing licence, said a Bangladesh Telecommunication Regulatory Commission clarification notice issued on Monday. The BTRC clarification issued under the tower sharing guidelines by its deputy director SM Golam Sorwar on Monday also said that besides Robi, in case of any other mobile phone operator having ownership in any proposed tower sharing company, will have to discharge their ownership to make the company eligible for the licence. Apart from that, a proposed tower sharing company and mobile network operator or broadband wireless access operator should not have same direct shareholders, it said. At present, Robi has 20 per cent ownership in edotco, running with government’s no-objection certificate, while the rest 80 per cent shares of the entity is owned by Malaysia-based edotco Group while Axiata, the parent company of Robi by holding 68.7 per cent share, is also the parent company of edotco Group by holding 63 per cent shares.
Rice prices finally declining
Rice prices have finally started dropping off in the face of ample supply brought about by huge imports and arrivals of the fresh staple from the Boro harvests, said farmers and traders. In the last two weeks, the prices of fine rice declined 1.54 percent to Tk 60-68 a kilogramme and that of coarse rice 3.65 percent to Tk 38-44 per kilogramme, according to data from the Trading Corporation of Bangladesh. Newly harvested paddy prices also marked a decline owing to increasing supply and speculation of good harvest if weather remains favourable over the next three-four weeks.
Plea for ensuring sustainable production to cut pollution
The level of pollution jumps by 12 per cent if the industry increases only one per cent as the production process is not sustainable or environment-friendly despite the fact that 74 development activities take place through the private sector, experts said at a discussion on Monday. They also said degradation of the environment and disasters are the major concerns that creep in alongside the development. So, sustainable consumption and production are crucial to tackling the catastrophe. If the private sector cannot ensure a sustainable production process, Bangladesh will not be able to achieve the goal 12 of SDG by 2030 as environmental degradation and misuse of resources take place during the production process, they added. ActionAid Bangladesh, MACOMM and the University of Liberal Arts of Bangladesh jointly organised the discussion titled ‘Driving Sustainable Consumption and Production: The Role of the Private Sector’ at a city hotel.
Solar power improves livelihood of char people
By virtue of solar power, the lifestyle of around 0.2 million people, living in some 200 remote and hardly reachable riverine char villages of all five districts in greater Rangpur region, is changing fast. Government officials and NGOs executives said the char people are getting uninterrupted power supply using over 28,000 solar power units set up in char villages of Rangpur, Nilphamari, Kurigram, Lalmonirhat and Gaibandha districts in the region. Different NGOs and the government through the Ministry of Disaster Management and Relief and Infrastructure Development Company Limited (IDCOL) are distributing solar panels to the people living in remote areas.
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)||$ 67.82||↓0.11||↓0.16%|
|Crude Oil (Brent)||$ 73.20||↓0.16||↓0.22%|
|Gold Spot||$ 1,308.36||↑3.40||↑0.26%|
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 84.15|
|GBP 1||BDT 114.37|
|EUR 1||BDT 100.77|
|INR 1||BDT 1.26|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.