VAT cut likely for Power Plants’ Coal Import
The National Board of Revenue is likely to cut value added tax on the import of coal for power plants to 5 percent from present 15 percent in order to facilitate electricity generation at reduced costs, according to a senior official yesterday. The move comes at a time when the construction of three coal-fired power plants in the public sector is on while one in Payra in the southern district of Patuakhali is expected to start producing around 660 megawatts of electricity. Apart from this, four private sector coal-based power plants are in the process of being established, according to the minutes of a meeting between the NBR and the Power Division in August this year. A huge amount of coal would be required once these power plants go into operation. The NBR said there were no customs and other duties for coal import. Some 15 percent VAT, 5 percent advance tax, and 5 percent advance income tax are applied on the fuel’s import, according to the NBR. As coal accounts for nearly 65 percent of the electricity production cost, a reduction in the VAT rate will bring down the cost of generation, according to the meeting minutes. Considering the issue, the NBR has decided to slash the VAT on coal import to help reduce the production cost, according to the official.
Govt focuses more on Bank Borrowing
The Government borrowed nearly Tk 280 billion from the country’s Banking system in more than 100 days of the current Fiscal Year [FY] to meet the budget deficit, partially. A falling trend in sales of national savings certificates along with a shortfall in revenue collection has led to higher Bank borrowing by the Government during the period under review, officials said. Meanwhile, the Government’s aggregate net Bank borrowing stood at Tk 276.34 billion, which was more than 58 per cent of the total target, as of October 21 of FY 2019-2020, according to a Bangladesh Bank [BB]’s confidential report. Of the total, the Government borrowed Tk 256.88 billion from the Scheduled Banks using Treasury bills [T-bills] and bonds, and the remainder Tk 19.46 billion from the Central Bank. The official also said lower revenue collection than the target has also pushed up the Government’s Bank borrowing during the period under review. Revenue collection by the National Board of Revenue fell by Tk 93.17 billion to Tk 296.20 billion in the July-August period of FY’20 as against the target of Tk 389.37 billion. The volume of borrowing may increase by a big margin in December as the Government will have to pay more than Tk 100 billion against maturities of its securities particularly T-bills, according to the official. The Government will be able to borrow up to a maximum amount of Tk 60 billion from the Central Bank of Bangladesh without issuing any securities.
BD’s Cereal output gets thumbs-up from ADB
The Asian Development Bank has lauded Bangladesh for achieving self-sufficiency in rice output, but voiced worry over falling income of the farming community. This progress was largely driven by the Green Revolution technologies that put high yielding seed varieties in the hands of our farmers, according to Takehiko Nakao, ADB president, mentioned in the three-day “Rural Development and Food Security” Forum that opened in Manila on Monday. The advancement was also accompanied by investments in up gradation of rural roads and irrigation, and agricultural extension. Bangladesh’s rice production has tripled to more than 35 million tonnes since 1971 when the country gained independence from Pakistan. The food security situation in the Asian region saw “remarkable” improvement in the last four decades. The region’s share in global food production, crops and livestock, has increased. In Bangladesh, the incidence of poverty more than halved during the last quarter century, thanks to sustained growth, aided by exports, remittances and robust farm output. The economy eked out a growth of 8.1 per cent in the fiscal year 2019, a feat the ADB labelled as the highest in Asia and the Pacific region.
Biman starts Direct Flight to Madina
Biman Bangladesh Airlines launched on Monday direct flight operation on Dhaka-Madina route initially with three flights a week. Madina will be the second destination to Saudi Arabia after Jeddah. Biman deployed its newly purchased Boeing 787-8 Dreamliner with a capacity of 271 seats, including 24 business and 247 economy class to operate the flights on Madina route. Besides, Biman will start flight operation on Chattogram-Madina-Chattogram route from October 31. Initially, Biman will operate flights on Dhaka-Madina-Dhaka route on Saturday, Monday and Wednesday. State Minister for Civil Aviation M Mahbub Ali inaugurated the maiden Dhaka-Madina flight at Hazrat Shahjalal International Airport [HSIA] in the city. The first flight left Dhaka with 241 passengers on board. The return fare for economy class on Dhaka-Madina route will be US$ 605 and on Chattogram-Madina route US$ 622. Besides, he said, the new route will also benefit large number of Bangladeshi expatriate workforce who are residing in Saudi Arabia. By 2020, the Dhaka-Manchester route will open.
English Fashion Brand Lee Cooper enters Bangladesh
British fashion brand Lee Cooper yesterday teamed up with Bangladesh’s Express Leather Products to enter into the growing market of the South Asian nation. Bangladesh is a huge opportunity for us. We were looking for Bangladesh for a long time, according to Wayne Bebb, Global Managing Director at Lee Cooper, after signing the agreement at Pan Pacific Sonargaon in Dhaka. Lee Cooper is expanding its operations a lot all over the world and Bangladesh is a part of our expansion plan. Bangladesh is becoming a significant partner of Lee Cooper. Lee Cooper started its journey in Bangladesh with leather footwear products from today. Lee Cooper came here mainly to grab the young consumers of Bangladesh. The target customers are from the young generation. Around 50 percent of Bangladesh’s population is aged below 25 years. So this is a very big market for them.
IPDC to focus more on Digital Platform-based Financial Service
IPDC Finance Limited, a leading Non-Bank Financial Institution [NBFI], will focus more on digital platform-based and gender-sensitive financial services in the coming days. The financial institution will also launch a retailer financing scheme to facilitate retailers getting low-cost and collateral-free fund for their businesses by the beginning of next year and a consumer goods financing scheme by the middle of 2020. The vision was disclosed at the NBFIs ‘Investors meet’ held at a hotel in the capital’s Gulshan area on Sunday. IPDC is currently working with IBM to develop a blockchain-based supply chain platform, first of its kind in the country. Apart from industrial finance, the organization will focus more on providing affordable housing loans, building women-sensitive business model, and SME [small and medium enterprise] and retail financing. The loans and advances of the NBFI stood at Tk 47.90 billion till date, up from Tk 44.32 billion in the last year, registering a growth of 8.10 per cent. The company made an operating profit of Tk 846 million [18.8 per cent], net profit of Tk 446 million [55.9 per cent year-on-year growth] and saw a revenue of Tk 1.53 billion till date this year.
DSE Forms Body to review IPOs
The premier bourse has formed a high-profile committee to review the IPO [initial public offering] proposals in a bid to ensure quality of the listings on the country’s stock exchanges. The board of the Dhaka Stock Exchange [DSE] formed the body at a meeting held at its office in the city on Monday. The initiative of the DSE came after the Bangladesh Securities and Exchange Commission [BSEC] gave an assurance on Thursday that it would evaluate the DSE’s observations while approving IPO proposals. Two or three members from the expert panel will be assigned to assist the review committee in scrutinizing each IPO proposal, according to a DSE official. The review committee has been asked to prepare the Terms of Reference [ToR] for review of IPO proposals and other relevant proposals within next two working days.
Transforming Ride-Sharing into sustainable Business
The concept of Demand Responsive Transportation [DRT] services, commonly known as ride-sharing services, is comparatively new in Bangladesh. Although traditional forms of on-demand transportation system were always available in several forms like car or truck rental, Bangladesh didn’t see ride-sharing services driven entirely by technology till 2016. By now, a few local and foreign ride-hailing services providers, namely Uber, Pathao, Shohoz Rides, Obhai, and PickMe are operating in Dhaka and Chittagong city. The ride-sharing industry is worth about Tk 2,200 crore, which is 23 percent of the transportation sector of the country, according to media reports. The current market size and its potential for further growth attracted many foreign investors to the DRT services industry. For example, Jakarta-based ride-sharing firm Gojek invested $2 million in Pathao. This consequently resulted in an influx of app-based transportation services providers for food delivery, parcel delivery, motorbike, car, truck, and CNG hailing services. Modern DRT systems run only through Global Positioning System [GPS]-enabled smartphones with high speed internet. About 90.05 million people are using internet that made Bangladesh to be among the top five countries in Asia in terms of the number of internet users.
Jashore Farmers succeed in growing Turmeric
Confidence Cement has recommended stock dividend, though a listed Favorable weather conditions for turmeric cultivation this year in Jashore are making farmers hopeful of reaping a good harvest. After making continued profits from the crop in past several years, turmeric farmers in all eight upazilas of the district are increasingly getting more confidence in investing in the crop again. This year, turmeric will be grown on more than 645 hectares of land all over Jashore and the crop is likely to be harvested within the next fifteen days, according to Department of Agricultural Extension [DAE] sources in Jashore. A large number of farmers who usually grow other crops in the region are also being drawn to grow turmeric in recent years. Besides, different spices including turmeric grow well in the region for its moderate rainfall as well as its suitable atmosphere and soil. According to DAE’s agriculture officer in Monirampur upazila, compared to other crops, profit margin in turmeric cultivation is very high as around Tk 30,000 can be made in profit from one bigha of land where nearly 100 maunds of turmeric can be harvested at a cost of Tk 30,000. Farmers are now selling each maund of the produce for Tk 6,000 at wholesale markets while each kilogram of dried turmeric now sells for Tk 100 at retail markets.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
|↑ 132.66 ||↑ 0.49%|
|FTSE100||7,331.28||↑ 6.81 || ↓ 0.09% |
|Nikkei 225||22,975.13 ||↑ 107.86 ||↑ 0.47%|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 55.66 ||↓ 0.15 ||↓ 0.27%|
|Crude Oil (Brent)||$ 61.48 || ↓ 0.09 ||↓ 0.15%|
|Gold Spot||$ 1,492.55 ||↑ 0.04 ||0.00% |
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 83.2015|
|GBP 1||BDT 106.834|
|EUR 1||BDT 92.2800|
|INR 1||BDT 106.834|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.<