Bangladesh is at a crossroads where the past meets the present and the future is forged.    

The private sector’s foreign debt decreased by 4.3 per cent, or more than $1 billion, in the second quarter of the current fiscal year following Bangladesh Bank’s strict measures to control imports.

Bangladesh is going through a period of economic slowdown and this weakening of the economy will be looming large for the entire period of 2023. The biggest problem for the common people now is inflation. It has increased the living cost and decreased the actual income.

Bangladesh has averted a potential major crisis by reaching out to the International Monetary Fund (IMF) in a timely manner, said Kaushik Basu, a former chief economist of the World Bank.

The record subsidy allocation of Tk 82,745 crore is set to be topped up with another Tk 27,360 crore in the revised budget in the face of demands from ministries even after the notable price hike of gas, electricity and fuel.

By removing the floor price for nearly half of the companies listed in the country in December while retaining the regulatory measure for the rest, the Bangladesh Securities and Exchange Commission (BSEC) has effectively moved to a dual system. 

Bangladesh’s stock market had a lackluster year in 2022 after posting double-digit returns for the previous two years. Dhaka Stock Exchange (DSEX), the broad market index of the country, fell 8.1 per cent in 2022, while daily average turnover fell by 35 per cent.

IMF loan cannot be the only factor behind much-needed structural changes

The ongoing dollar shortage in the banking sector is posing a threat to local textile millers and spinners as they are in trouble in opening letters of credit (LCs) to import raw materials and cotton to feed the country’s readymade garment industry. 

The government is expecting the shrinking foreign currency reserves will buck the trend and hit $37.7 billion by June thanks to lower imports and budget support from development partners.

It seems the government is doing an about-turn from the austerity stance taken at the start of the fiscal year.

Bangladesh should be careful about falling into the middle-income trap, said Axel van Trotsenburg, the World Bank’s managing director of operations.

Bangladesh’s balance of payments (BoP) deficit would widen massively in the current fiscal year than the central bank had earlier projected owing to escalated imports, lower remittances and export receipts, and higher accumulation of debts.

The Bangladesh Bank is yet to take any visible measure in line with a commerce ministry directive aimed at asking banks to earmark a portion of their foreign currency holdings to open letters of credit to import essentials ahead of Ramadan. 

We are told that taka is available, and then it’s not there anymore.

Bangladesh’s $4.5 billion loan programme with the International Monetary Fund is expected to get the final approval on January 30, said the lender’s visiting top official yesterday.

Bangladesh Bank yesterday unveiled a wishy-washy monetary policy for the next six months that will prove to be ineffective in tackling the headwinds passing through the economy.

There would not be any further negotiations on the $4.5 billion loan programme during International Monetary Fund’s deputy managing director Antoinette Monsio Sayeh’s forthcoming visit to Bangladesh.

The World Bank yesterday delivered yet another bad news for the economy as the Washington-based multilateral lender pared back Bangladesh’s growth forecast for this fiscal year by 1.5 percent to 5.2 percent.

This year was always supposed to be a celebration of Bangladesh’s economic progress with the opening of Padma bridge and Dhaka metro rail and 100 percent electrification.