[🇧🇩] Monitoring Bangladesh's Economy

[Saif]

NBR looking to expand the base of VAT payers

The National Board of Revenue (NBR) has taken a move to expand its Value Added Tax (VAT) base, with a view to increase revenue collection for the national exchequer. In a meeting chaired by NBR chairman Md Abdur Rahman Khan on Thursday, the field level officials of Dhaka have been asked to be more

thefinancialexpress.com.bd

NBR looking to expand the base of VAT payers
UNB
Published :
Apr 05, 2025 11:00
Updated :
Apr 05, 2025 11:00

The National Board of Revenue (NBR) has taken a move to expand its Value Added Tax (VAT) base, with a view to increase revenue collection for the national exchequer.

In a meeting chaired by NBR chairman Md Abdur Rahman Khan on Thursday, the field level officials of Dhaka have been asked to be more active and sincere for improving VAT collection keeping aside the stories of growth.

An official who was present in the meeting told UNB that the NBR chairman has instructed them to expand the base of VAT.

“I do not want to hear the word growth anymore, I want to see the expansion of VAT net,” the NBR official quoted the NBR chairman as saying.

The NBR boss also asked the officials to change their mind set regarding revenue collection.

“You have to change your attitude, otherwise there is no need to be here anymore,” he warned the officials who were present in the meeting, according to the official who spoke to UNB on condition of anonymity.

The NBR chairman also assured that the good performers will be awarded, although he expressed his depression regarding the poor performance of the VAT wing.

“We are unable to show any good performance till now in VAT collection, you have to conduct combing drives to find new VAT payers, you have to work as the whole nation is depending on the NBR,” he told the meeting.

Abdur Rahman Khan, giving example of people’s eagerness to pay taxes during the 1/11 period, said that at that time people were very much enthusiastic to pay taxes.

“We have to handle the situation like that,” he said.

He also asked the officials not to harass the compliant VAT payers.

Earlier on Monday, while holding a pre-budget meeting with the Economic Reporters’ Forum (ERF), the NBR chairman had said that he had already instructed his VAT officials to conduct combing drives in a small area first to make all business people pay their VAT.

“No one will be left out from this drive, each and every shop owners will pay their applicable VAT, there will be no discrimination in this regard,” he said.

He said that the NBR is moving towards that direction.

The government on January 9 had issued the "Value Added Tax and Supplementary Duty (Amendment) Ordinance, 2025" and "The Excises and Salt Act (Amendment) Ordinance, 2025" imposing increased VAT rate on more than hundreds of different kinds of items aiming to strengthen the country's economic base.

But later, facing strong protest and criticism the NBR has issued several notifications by re-fixing the rates of VAT, Supplementary Duty and Excise Duty on a number goods and services, which were increased on January 9.

Now the NBR wants to impose a single, flat rate of VAT for all goods and services in the country, if the business people agree to that.

The NBR chairman has already said that the VAT is currently mired in total indiscipline.

He said that if input VAT credit and standard VAT rate can be imposed properly, then for many business entities the rate would be less than one percent.

He mentioned that for a long time the VAT Law has been distorted. In this connection he said that the new VAT Law was introduced in 2012 which was amended in 2019 after some major distortion.

He said that the power of VAT was accounting based and invoice based, it has been destroyed. As a result it is not growing right now, the main strength of VAT has been uprooted.

“We want to bring discipline in VAT,” he said in the pre-budget meeting with the ERF on Monday.​

 

[Saif]

https://www.thedailystar.net/business/news/global-investors-set-attend-investment-summit-amid-fdi-concerns-3864206

Global investors set to attend investment summit amid FDI concerns
The event is scheduled to begin in Bangladesh on April 7

The Bangladesh Investment Summit 2025 is set to begin at the InterContinental Dhaka on April 7, taking place at a critical juncture when foreign direct investment (FDI) inflows have plunged to a six-year low, raising concerns about the country's investment climate.

Chief Adviser Prof Muhammad Yunus, in a message to global partners, extended a warm invitation to the summit, calling it an opportune moment to explore Bangladesh's investment potential.

"My friends, partners, and distinguished global leaders from around the world, it is my honour and pleasure to warmly invite you to the Bangladesh Investment Summit 2025," Yunus said.

He highlighted the country's recent economic transformations, driven by progressive investment policies, and reaffirmed the government's commitment to ensuring a level playing field for all investors.

"Bangladesh today stands out with its defining strengths -- solid economic fundamentals, globally competitive resources, and one of the highest returns on investment in the region.

"This summit serves as your gateway to data-driven insights into Bangladesh's most promising sectors. Join us and witness firsthand the immense opportunities our nation holds. Partner with us in shaping the future of one of the world's most dynamic economies."

Scheduled to run from April 7 to April 10, the summit aims to draw attention from global investors and underscore Bangladesh's evolving economic landscape.

More than 550 foreign investors from 50 countries have registered to attend, alongside 2,500 local participants.

Against this backdrop of political uncertainty, isolated incidents of labour unrest, and broader economic challenges, the summit is seen as a crucial platform to rebuild investor confidence, highlight economic reforms, and position Bangladesh as a competitive investment destination.

According to the Bangladesh Bank, FDI inflows declined by 71 percent year-on-year in the July–September quarter of FY25, dropping to $104.33 million -- the lowest in six years.

The country's total FDI stock stood at $17.68 billion as of September 2024, with the United Kingdom, Singapore, and South Korea emerging as the top three investors.

The UK leads the way with $3.05 billion -- primarily invested in banking, power, and pharmaceuticals. Singapore follows with $1.78 billion, and South Korea ranks third with $1.6 billion, driven by investments in manufacturing and telecommunications.

Many high-ranking officials and dignitaries are expected to take part in the summit, according to the Bangladesh Investment Development Authority (Bida), including Óscar García Maceiras, CEO of Inditex, Sultan Ahmed bin Sulayem, group chairman and CEO of DP World, Kyeongsu Lee, vice-president of Samsung Construction and Trading Corporation, Jon Omund Revhaug, executive vice-president and head of Telenor Asia, and Han Jun-seokt, CEO of Giordano Korea.

Baroness Rosie Winterton of Doncaster, DBE, the UK's Trade Envoy to Bangladesh, Jarno Syrjälä, under-secretary of state for international trade at the Ministry for Foreign Affairs of Finland, and Mike Orgill, senior director, public policy and government relations, APAC, Uber are also expected to feature.

At a press briefing held at the Foreign Service Academy in Dhaka on March 23, Ashik Chowdhury, executive chairman of the Bida, reaffirmed the government's commitment to fostering an investment environment anchored in economic stability and policy transparency.

He admitted that concerns persist, ranging from policy unpredictability to infrastructure bottlenecks. However, he underscored that Bangladesh's resilient economic growth, diverse industrial base, and ongoing reform measures signal a promising future for long-term investors.

Chowdhury also stressed that policy consistency, infrastructure development, and regulatory simplification will be critical in ensuring sustained investor confidence.

The summit will officially be inaugurated on April 9 by the chief adviser, alongside senior executives from multinational corporations.

The Bida hopes that the event will act as a turning point for investor sentiment, offering a platform to showcase the country's progress while allowing policymakers to engage directly with international stakeholders.​

 

[Saif]

https://www.thedailystar.net/business/economy/news/rising-costs-erode-business-competitiveness-3864336

Rising costs erode business competitiveness

Bangladesh, long regarded as a cost-competitive destination and once hailed as the next Asian tiger, is now grappling with mounting pressure as the cost of doing business is rising sharply across key sectors.

What was once considered the country's strongest advantage – a cheap labour pool -- is now being undermined by persistent infrastructural weaknesses, policy unpredictability, and rising input costs.

The World Bank's latest assessment and regional business surveys reveal that while labour costs in Bangladesh remain comparatively lower than in Vietnam and India, the total cost structure -- encompassing logistics, energy, financing, and regulatory compliance -- has become increasingly unfavourable.

The issue has once again come to the spotlight, becoming highly relevant as the US government has raised the tariff on Bangladeshi products to 37 percent from around 15 percent.

Experts believe that shipments of Bangladeshi goods will experience a significant setback, with the possibility of a decline in exports to the US market due to the reduction in competitiveness.

The new US tariff on Bangladeshi products has created uncertainty, which is not helpful for a developing country like Bangladesh.

According to the Comprehensive Report on the Logistics Sector of Bangladesh, prepared by the Economic Relations Division of the Bangladesh government, logistics alone account for 15-20 percent of production expenses, significantly higher than Vietnam's 9-11 percent.

This sharp gap is mainly attributed to poor road infrastructure, congestion at major ports such as Chattogram, and outdated logistical facilities.

In contrast, Vietnam's investment in deep-sea ports and modern transport networks has helped reduce delivery times and lower logistics costs, boosting its competitiveness.

Energy is another major hurdle.

Bangladesh's reliance on expensive imported liquefied natural gas (LNG) and furnace oil has exposed businesses to volatile and elevated electricity prices.

Vietnam and India, by comparison, have successfully expanded renewable energy capacity and secured stable, long-term energy supplies, reducing production uncertainty.

Cambodia, despite its economy being smaller, benefits from affordable hydropower imports from its neighbours.

The situation is further aggravated by the rising cost of finance.

The recent adoption of the SMART interest rate regime has driven business lending rates above 13 percent.

In comparison, Vietnamese firms enjoy borrowing rates between 7 to 9 percent, while India's recent monetary easing has brought small and medium enterprise lending rates to around 8 to 10 percent.

Policy inconsistency is also becoming a serious impediment.

Frequent changes to tariff structures, regulatory delays, and a lack of predictability in key business policies have diminished confidence among both foreign and domestic investors.

By contrast, Vietnam and Cambodia have pursued stable, investment-friendly regulatory environments.

A comparative study by the Policy Research Institute (PRI), titled "Vietnam's Superb Export Performance: Lessons for Bangladesh" and conducted in 2021, shows that Vietnam now attracts nearly $27 billion in annual foreign direct investment (FDI).

Meanwhile, Bangladesh struggles to reach even $3 billion.

Even Cambodia, with a far smaller economy, performs better than Bangladesh in FDI inflows per capita.

Selim Raihan, executive director of the South Asian Network on Economic Modeling, observed that Bangladesh was caught in a web of deep-rooted structural problems.

"We are stuck in several fundamental areas," he said. "Logistics, business finance, and the high cost of capital have become significant constraints. Our only sustained advantage has been low labour costs -- and even that is now under threat."

Raihan warned that unless Bangladesh addresses its critical weaknesses in infrastructure, port management, business finance, and skills development, the country's ambitions to diversify beyond ready-made garments would remain elusive.

Raihan said Bangladesh urgently needs policy reforms, robust infrastructure development, and skilled workforce training to enhance its export competitiveness.

It is essential to formulate supportive policies to attract foreign investment and expedite the implementation of free trade agreements (FTAs), he said.

"Efforts should also be undertaken to reduce tariffs and diversify exports. Active participation in bilateral, multilateral, and regional cooperation is crucial for global trade," he said.

He emphasised that immediate initiatives were vital to addressing upcoming challenges following Bangladesh's graduation from least developed country (LDC) status.

M Masrur Reaz, chairman of Policy Exchange Bangladesh, echoed similar concerns.

"The issue is no longer confined to the garment sector. The entire business environment is under pressure due to high costs and structural inefficiencies," he said.

"Geopolitical shifts, rising protectionism, and automation are reshaping global value chains. Countries with stronger fundamentals are taking advantage of this transition, while Bangladesh is falling behind," he said.

Reaz underlined the urgent need for reforms to enhance trade facilitation, modernise logistics, strengthen infrastructure, and build human capital.

"Without timely and coordinated actions, Bangladesh's position as a competitive manufacturing and export hub will continue to weaken," he said.

Adding to these concerns, Asif Ibrahim, a leading exporter of the readymade garments sector, said Bangladesh's exports to the US would face challenges following the hiking of the tariff on imports from Bangladesh.

"This tariff will be a significant burden for Bangladesh's overall exports to the United States, especially when some of the countries that Bangladesh compete with for US market share have been imposed with lesser tariffs," Ibrahim said, referring to India.

He urged policymakers to address this challenge on an urgent basis by reducing import tariff of the main export items of the US to Bangladesh.

"This is crucial for protecting Bangladesh's long-term trade interests and for ensuring sustained economic growth," he added.

With the upcoming LDC graduation in 2026, Bangladesh's competitiveness will be tested further as preferential trade treatments begin to phase out.

Without significant reforms, the rising cost of doing business could become the biggest obstacle to Bangladesh's future growth.​

 

[Saif]

Trade deficit dropped by $632m in eight months as exports grow more than imports

Bangladesh’s trade deficit continues to decline in the 2024-25 financial year (FY25) as export growth surpasses import expansion. The deficit fell by 4.41 per cent in the first eight months of FY25. The July-February period of the fiscal saw a year-on-year decrease of $632 million, accordin

thefinancialexpress.com.bd

Trade deficit dropped by $632m in eight months as exports grow more than imports
Published :
Apr 06, 2025 23:51
Updated :
Apr 06, 2025 23:51

Bangladesh’s trade deficit continues to decline in the 2024-25 financial year (FY25) as export growth surpasses import expansion.

The deficit fell by 4.41 per cent in the first eight months of FY25.

The July-February period of the fiscal saw a year-on-year decrease of $632 million, according to the latest Bangladesh Bank data released on Sunday.

The central bank said the trade deficit in the FY25 from July to February stood at $13.70 billion from $14.32 billion in the same period of the previous fiscal year.

Exports grew by 9.10 per cent in the first eight months of the current fiscal year and amounted to $30 billion, up from $27.54 billion in the same period last year.

On the other hand, imports rose by 4.5 per cent and in the current fiscal stood at $43.73 billion from $41.87 billion in the previous fiscal.

An analysis shows that the trade deficit has narrowed due to the increase in imports along with exports.

According to the balance of payments data, the current account deficit has declined by 68.90 percent in the first eight months.

The current account deficit during the period stood at $1.27 billion, down from $4.7 billion in the same period of the previous fiscal year.

Again, in the July-February period of the current fiscal year, the financial account stood at $1.42 billion, up from $654 million in the same period last year.

That means an increase in the surplus of over 116 per cent.

Former World Bank chief economist for Bangladesh Zahid Hussain told bdnews24.com, “The fiscal balance has improved a bit from before. Remittances topped $3 billion in March. It is expected that the balance of payments in March will be better than this month."​

 

[Saif]

Gross foreign currency reserves increase to $25.63b

Foreign currency reserves have crossed the US$25.6 billion mark at the end of March thanks to a record inflow of remittances this month. The country’s gross reserves have risen to $25.63 billion, according to data released by the Bangladesh Bank (BB) on Sunday. The surge came after a signif

thefinancialexpress.com.bd

Gross foreign currency reserves increase to $25.63b
FE Online Desk
Published :
Apr 06, 2025 20:10
Updated :
Apr 06, 2025 20:10

Foreign currency reserves have crossed the US$25.6 billion mark at the end of March thanks to a record inflow of remittances this month.

The country’s gross reserves have risen to $25.63 billion, according to data released by the Bangladesh Bank (BB) on Sunday.

The surge came after a significant increase in remittance inflows, which reached $3.29 billion in March, the highest for any month in the country’s history, reports BSS.

However, as per the International Monetary Fund (IMF) methodology under the Balance of Payments and International Investment Position Manual (BPM6), Bangladesh’s net reserves currently stand at $20.46 billion.​

 

[Saif]

IMF notes some progresses on BD economic front

Some positive notes in the latest IMF review of Bangladesh's economic situation raise hope in government high-ups for release of a stalled loan tranche together with the next one by June. "We are optimistic," Finance Adviser Dr Sale

thefinancialexpress.com.bd

IMF notes some progresses on BD economic front
Govt expects two loan tranches' release by June
FE Report
Published :
Apr 06, 2025 23:58
Updated :
Apr 06, 2025 23:58

Some positive notes in the latest IMF review of Bangladesh's economic situation raise hope in government high-ups for release of a stalled loan tranche together with the next one by June.

"We are optimistic," Finance Adviser Dr Salehuddin Ahmed told reporters when asked whether he remains hopeful about receiving the fourth installment of the US$4.7-billion credit after he had a meeting with the visiting IMF team members Sunday at the secretariat.

He said the International Monetary Fund (IMF) is primarily concerned about Bangladesh's low revenue generation.

"The main focus of today's (Sunday) discussion was on how much revenue can be generated, the size of the upcoming budget, and the expected deficit," he told the reporters.

He said making a law to deal with non-performing loans and related issues also came up for consultation.

Dr Ahmed stressed the need for continuing improving governance in the banking sector.

Asked wherein the IMF's emphasis lies regarding the disbursement of the fourth and fifth tranches of its conditional package loan, the finance adviser said, "The key issues are increasing tax revenue, stabilising the foreign-exchange rate, and reducing the budget deficit."

To another question, he said both the exchange rate and foreign-exchange reserves were discussed under the review of the country's macroeconomic health.

The adviser quoted the IMF team as saying that they would return to Washington, review the situation, and then give their opinion.

"We are scheduled to meet again on April 19, and a review meeting is expected around May-June," Dr Ahmed told the reporters.

He said the final decision regarding the loan would be made after that review. "They will provide recommendations based on their assessment."

In response to a question about IMF views on the country's economic situation under the current interim government, Dr Ahmed said Bangladesh's economy is currently stable and heading in the right direction.

Asked whether the IMF was demanding sacrifices or offering flexibility, he said, "We are doing what is necessary for us. We have already shown our good intentions. Now, it's their turn to demonstrate goodwill."

The custodian of exchequer feels reforms are essential regardless of IMF support.

"We must take action-not because the IMF says so-but because it's vital for our economy. We need to reform the banking sector, address bad loans, and boost revenue generation. These are fundamental things we have to do anyway."

On the revenue sector, Dr Ahmed said there are revenue leakages that need to be addressed. "The tax-to-GDP ratio must improve. The tax net has to be expanded. Many people file returns declaring zero income, despite having earnings. This practice must be curtailed."

Quoting the visiting team he said Nepal and Sri Lanka perform better than Bangladesh does in terms of tax-to-GDP ratios.

To a query on introduction of a single VAT rate, the finance adviser said, "We will try to move toward a single rate, but it cannot be implemented right this moment."

Meanwhile, the International Monetary Fund team, in another meeting on the day with the central bank of Bangladesh, noted that the existing managed floating exchange rate still remained a concern to the IMF and suggested that the regulator go for market-driven exchange system, meeting sources said.

Seeking anonymity, a Bangladesh Bank (BB) official said the IMF representatives in the meeting hailed various macroeconomic progresses in terms of boosting NIR or net international reserves and modernisation of monetary-policy framework.

The central banker, who was present at the parleys, said the exchange rate is still managed floating one which needs to be flexible and market-centric--one of the major lending conditions set by the global lender. The BB official said the IMF representatives observed that the economic growth started rebounding and the inflationary pressure easing. Under such circumstances, they said, the banking regulator can consider further flexibility in exchange rate and cutting down the policy rate (now 10 per cent).

In response, the sources said, BB Governor Dr Ahsan H. Mansur said the inflationary burden keeps dropping because of various prudent policy interventions and the exchange rate remains stable for the last few months.

"Once the inflation comes down to our projected level in the coming months, we would probably consider more exchange-rate flexibility and adjustment of the policy rate," the governor was quoted as saying.

Simultaneously, the IMF team members enquired about the current state of the liquidity crisis-hit commercial banks and their revival strategy.

Earlier, the IMF had deferred the release of the fourth tranche of the loan until June instead of March as Bangladesh could not meet some preconditions.

As per the latest developments, the IMF might release both the fourth and fifth together in June, which could amount to more than $1.0 billion, upon fulfilling conditions.​

 

[Saif]

NBR's reluctance to comply with IMF

The National Board of Revenue's (NBR's) flat refusal to go by the recipe the International Monetary Fund (IMF) advanced for the Bangladesh tax authority to pursue a revised target for collection of an additional amount of revenue of Tk570 billion for the fiscal year 2025-26 is evidently a departure

thefinancialexpress.com.bd

NBR's reluctance to comply with IMF
FE
Published :
Apr 09, 2025 22:51
Updated :
Apr 09, 2025 22:51

The National Board of Revenue's (NBR's) flat refusal to go by the recipe the International Monetary Fund (IMF) advanced for the Bangladesh tax authority to pursue a revised target for collection of an additional amount of revenue of Tk570 billion for the fiscal year 2025-26 is evidently a departure from its traditional soft stance. Although the NBR hopes that the intent of non-compliance expressed in a meeting between it and a visiting IMF team would not stand in the way of the latter's release of fourth and fifth tranches of $4.7-billion loan package, there is no certainty of this happening. The release of the fourth tranche has been delayed because of non-fulfilment of certain conditions. How the matter would shape is likely to depend on the outcome of the negotiations in second round of meeting between them held yesterday.

The NBR reposes its hope on policy changes and implementation of the existing laws for improvement in its performance but in the first meeting with IMF, it could not brief the latter of the transformative programmes for tax collection. Now the important point here is if this can be convincingly presented for the IMF consideration, will it be enough for the multilateral organisation to relax pressure on the NBR to raise the tax collection to its prescribed level? The policy framework has so long remained quaint and ineffective leaving much to be desired. One of the most important aspects is the tax-GDP ratio which is one of the lowest in the world and even in the South Asian region. In 2024, this ratio was a meagre 7.4 per cent and to everyone's concern, it has been declining over the recent years. Not only the IMF but the well-meaning citizens of this country has long been urging for expanding the tax net and raising the tax-GDP ratio.

Sure enough, the NBR cannot defend its performance. No matter under which regimes ---autocrat or pro-people---the tax authority runs the revenue operatives, at the end of the day the state's incomes are indicative of its economic health and source of the country's development finance and overall progress. The IMF's insistence that the NBR raise the tax-GDP ratio from the current 7.4 to 7.9 per cent is not at all misplaced. In the next fiscal year, this ratio should be pushed to 9.0 per cent, according to the IMF. Does it prove to be a herculean job for the NBR? If the unearned money accumulated by the likes of ACC's Motiur Rahman, former IGP Benazir Ahmed and other corrupt elements ---both in civil, judicial and military services---not excluding the NBR, are taken into account, it exposes the huge revenue those staggering figures would generate had the money been in regular circulation.

Now that the misappropriation of that outrageous scale cannot be expected, closer monitoring of business transaction, government procurement, various public expenditures etc., should help identify tax dodgers and undervalued income sources, undue tax exemptions and other such irregularities and malpractices to expand the tax bases of both individual and corporate taxpayers. When digitisation has made information available, even the cash receipts and cashless transactions can be tracked down with the help of electronic weighing scale, barcode scanner and label scale etc. A concerted campaign for everyone to keep the record straight can certainly improve the regime of revenue income.​

 

[Saif]

Bangladesh must diversify exportable products, markets; reform tariff structure: Hoe Yun Jeong

Asian Development Bank (ADB) Country Director for Bangladesh Hoe Yun Jeong on Wednesday said that Bangladesh must diversify its products and markets in the medium- and long-term perspective to brave the impacts of the US reciprocal tariff. “There are possible ways to mitigate the potential d

thefinancialexpress.com.bd

Bangladesh must diversify exportable products, markets; reform tariff structure: Hoe Yun Jeong
Published :
Apr 09, 2025 19:08
Updated :
Apr 09, 2025 19:08

Asian Development Bank (ADB) Country Director for Bangladesh Hoe Yun Jeong on Wednesday said that Bangladesh must diversify its products and markets in the medium- and long-term perspective to brave the impacts of the US reciprocal tariff.

“There are possible ways to mitigate the potential downfall. Yes, Bangladesh needs to consider proactively engaging and negotiating with the US while this has already begun,” he said.

The ADB Country Director was responding to queries of reporters during the launching of the Bangladesh chapter of the ADB’s latest report, the Asian Development Outlook (ADO), April, 2025 held at its Bangladesh Resident Mission office in the capital’s Agargaon area, reports BSS.

The United States has already announced a 37 percent tariff on imports from Bangladesh as part of President Donald Trump’s sweeping new “Reciprocal Tariffs” policy.

According to a chart published by the White House, the US government claims Bangladesh effectively imposes a 74 percent tariff on American goods. In response, a 37 percent “discounted reciprocal tariff” will now be levied on Bangladeshi products entering the US market.

In response to such move, Chief Adviser Professor Muhammad Yunus has already sent a letter to US President Donald Trump requesting him to postpone the application of a 37 percent tariff on Bangladeshi products in the US market.

In the letter, Prof Yunus requested US President Donald J Trump to postpone the application of US reciprocal tariff measures on Bangladesh for three months to allow the interim government to smoothly implement its initiative to substantially increase US exports to Bangladesh.

Besides, Commerce Adviser Sk. Bashir Uddin also sent a letter to USTR stating that the government would facilitate the export of 100 more products to Bangladesh at zero tariff to reduce the trade deficit with the United States.

The ADB Country Director said that negotiating with the US is important and also a short-term measure, but more important is that Bangladesh must diversify its markets and products for exports.

Going forward, he said Bangladesh can also take the opportunity to rationalize its own import tariff structure and reform its non-tariff barriers considering its tariff regime.

He said, “These types of tariff reforms are applied not only to the US but also to other countries.”

The ADB Country Director went on saying, “So, these are the broad measures that the government of Bangladesh needs to take into account as potential mitigation for US tariff,” he added.

Jeong also noted that it is too early to tell about the exact scale of impacts on the Bangladesh economy by the US tariff.

“We’ll continue to conduct analytical work on the impact and there will be further provided in July ADO update,” he added.

Acknowledging that Bangladesh is facing multiple economic challenges, the ADB Country Director told another questioner that the most urgent challenge might be the persistently high inflation, which erodes purchasing power and discourages investment.

“In our view, tackling high inflation rate will be a tough policy agenda going forward,” Jeong said, adding that the country also needs to address supply constraints as high inflation is also related to supply side disruptions.

“To address such issues, the government needs to improve supply chain, reduce logistics cost and invest in energy resources,” he added.​

 

[Bilal9]

Japanese company "Onodora Inc." has signed a memorandum of understanding with the Ministry of Expatriates' Welfare and Overseas Employment to export skilled manpower to Japan. Applicants will get free Japanese language training to find skilled employment in Japanese companies.

 

[Saif]

NBR chief says revenue target unattainable with so few taxpayers

National Board of Revenue (NBR) Chairman Abdur Rahman Khan believes that the revenue target is unachievable with just 1.5 million taxpayers in the country. Speaking at Chattogram on Thursday, he said 4.5 million taxpayers filed returns in the FY2024-25, and of them, 3 million filed zero returns, r

thefinancialexpress.com.bd

NBR chief says revenue target unattainable with so few taxpayers
Published :
Apr 10, 2025 22:40
Updated :
Apr 10, 2025 22:40

National Board of Revenue (NBR) Chairman Abdur Rahman Khan believes that the revenue target is unachievable with just 1.5 million taxpayers in the country.

Speaking at Chattogram on Thursday, he said 4.5 million taxpayers filed returns in the FY2024-25, and of them, 3 million filed zero returns, reports bdnews24.com.

“We’re sending a notice to those who are not filing returns. Their bank accounts will be sought next. Bangladesh’s tax-to-GDP ratio is very low. So the option of raising the tax rate is unavailable.”

On Thursday, the Chittagong Chamber of Commerce & Industry organised a pre-budget conference.

Abdur said everyone's opinions, including those of businessmen, were being accepted to make the budget people-friendly.

“The next budget will see a deficit. But we’ll stay cautious so inflation doesn’t occur. And tax rates will be increased reasonably to collect revenue.

“The government is working sincerely to ensure that the garment sector is not harmed due to the US government imposing additional tariffs,” he added.

He spoke of implementing “automation” to allow businessmen to pay taxes in a hassle-free manner without having to visit the NBR offices.

“Now, 160,000 certificates have been issued online through the single window.”​

 

[Saif]

No more bureaucratic hassles for foreign investment: BIDA

Bureaucratic complexities are no longer an issue when it comes to foreign investment in Bangladesh, said Nahian Rahman, head of business development at the Bangladesh Investment Development Authority (BIDA). Referring to the top five challenges raised by the foreign investors, Nahian said the main

thefinancialexpress.com.bd

No more bureaucratic hassles for foreign investment: BIDA
Published :
Apr 10, 2025 20:03
Updated :
Apr 10, 2025 20:53

Bureaucratic complexities are no longer an issue when it comes to foreign investment in Bangladesh, said Nahian Rahman, head of business development at the Bangladesh Investment Development Authority (BIDA).

Referring to the top five challenges raised by the foreign investors, Nahian said the main key issues in the National Board of Revenue (NBR) have been identified, and the government is actively working to address and overcome these challenges, he said.

The BIDA official made the remarks while responding to a question during a press briefing held on the fourth day of the investment summit at Hotel InterContinental in Dhaka on Thursday, reports UNB.

When asked about concerns raised during the summit regarding harassment by the NBR, Nahian said, “When we at BIDA spoke to more than two hundred investors, one of the major issues they pointed out was the amount of time it takes or the difficulties faced in getting things cleared through various government agencies, particularly the NBR.”

“This has now become one of our top priorities—how to make this process smoother,” he added.

“We’ve introduced the green channel and the authorised economic operator system. Our Single Window platform is already operational. So now, the focus is on how the NBR can push these initiatives forward,” said Nahian.

Speaking at the RMG and Textile session, Kihak Sung, chairman of Youngone Corporation and a pioneer in Bangladesh’s ready made garments (RMG) and textile sectors, noted that despite labor costs in Vietnam being 30% higher than in Bangladesh, profit margins were greater there due to higher worker productivity.

When asked about this issue, Nahian acknowledged the concern.

“We believe Kihak Sung’s observation is valid,” he said adding, “However, the products being made in Vietnam are more value-added and synthetic garments. So even with higher costs, they’re able to maintain profitability.”

He added that Youngone had previously faced legacy challenges with their operations in Bangladesh, which may have prevented them from investing in synthetic or high-value garments earlier.

“But now they’ve opened a new synthetic production line in the Korean EPZ, where they are producing high-value garments. That is expected to be profitable, said Nahian.

Rahman also highlighted that a new agreement was signed with Chinese company Handa just a day earlier, involving a major investment in synthetic garments. “If we can attract one or two more high-value anchor investments like this, it will pave the way for more value-added garment investment,” he said.

Responding to a question on whether bureaucratic hurdles continue to deter investors, he said, “This time investors have seen that significant improvements have been made. Previously, with around 70 ministers and state ministers, securing approvals was a challenge. Now, with only about 25 to 26 key advisors, decisions are more centralised and streamlined. Investors themselves have acknowledged this progress. Still, we have a long way to go.”

Asked about investment outcomes from the summit, Nahian said, “Several high-value agreements, including a $150 million deal with Handa were signed and we learned that local startup ShopUp secured a Tk 110 crore investment. None of this happens overnight—it’s the result of sustained effort.”

Talking about the participation of foreigners, he said, “We saw around 400 to 450 foreign delegates across different segments of the summit. Some companies sent more than one representative.”

He also noted that this year’s summit also focused on mobilising the private sector.

“The International Labour Organisation (ILO) was also very active. The goal wasn’t just to depend on one organisation, but to work collaboratively and push the investment pipeline forward,” he added.

BIDA executive member Shah Mohammad Mahbub and Deputy Press Secretary to the Chief Adviser, Abul Kalam Azad Majumdar were also present at the briefing.​

 

[Saif]

Bangladesh foreign loans drop to $103.6b

The country’s external debts fell by $736 million at the end of December 2024 due largely to the clearing of overdue payments and the interim government’s restrained approach to new overseas borrowing.

www.newagebd.net

Bangladesh foreign loans drop to $103.6b
Mostafizur Rahman 10 April, 2025, 23:48

The country’s external debts fell by $736 million at the end of December 2024 due largely to the clearing of overdue payments and the interim government’s restrained approach to new overseas borrowing.

According to the data published in the Bangladesh Bank’s report ‘Debtor classification of external debt of Bangladesh’, the external debts declined to $103.63 billion in the October-December quarter of 2024 compared with those of $104.36 billion in the previous quarter.

In the April-June quarter, the figure stood at $103.40 billion with a 4.5-per cent rise compared with that of $98.93 billion in the January-March quarter.

Economists have attributed the recent decline in the external debts to the political transition following the fall of autocratic Awami League regime on August 5, 2024 amid a mass uprising.

The interim government, which took office on August 8, 2024, has adopted a cautious approach to foreign borrowing, they said.

Following the political changeover on August 5, the Bangladesh Bank cleared nearly $3.3 billion or about 90 per cent of the foreign overdue payments by December, contributing significantly to the reduction in the external debt amount.

The BB data showed that government debts slightly fell to $84.21 billion in December from $84.42 billion in September, while private sector debts decreased to $19.42 billion from $19.94 billion.

Buyers’ credit, an arrangement under which companies use foreign loans to finance imports, also dropped to $5.22 billion in December from $5.71 billion in September and $5.76 in June.

Despite the recent drop in foreign debts, the interim government continued to face mounting overseas debt repayment obligations.

Bangladesh’s external debts surged significantly from $23.5 billion in 2009 to over $100 billion in December 2023 driven by a borrowing spree under the Awami League regime mainly for financing large-scale infrastructure projects.

Economists observed that this massive build-up of foreign debts resulted from flawed fiscal policies and poor project execution during the ousted AL regime.

The accumulation of debts, driven by questionable fiscal policies and widespread inefficiency, sent the per capita debt soaring to $604 in June 2024 from $283 in June 2017, and ordinary people now bear the brunt of this financial misadventure, they said.

The interim government is reviewing the implications of this debt build-up.

Selim Raihan, executive director of the South Asian Network on Economic Modeling, told New Age that the volume of foreign loans might decline slightly as the government had already curtailed development spending and was unlikely to adopt an expansionary policy.

He noted that the interim government was expected to remain cautious in securing new foreign financing.

He added that the forthcoming national budget might include a framework for foreign loan management, reflecting this cautious approach.

Selim warned that the current level of foreign debts could become a serious burden for the country, particularly because the returns on investments made with these funds are expected to be very low.

He criticised the previous government for accumulating large volumes of foreign loans indiscriminately, saying that much of the borrowing was not directed towards productive sectors.

He said that a significant portion of the loans were used unnecessarily and the practice became a source of corruption.

A white paper recently submitted to authorities pointed out that the country’s external debt sustainability had weakened due to an excessive reliance on non-concessional, foreign currency-denominated loans.

The white paper said that several megaprojects taken by the previous regime heavily contributed to the external debt surge.

Economists warn that interest payments would continue to climb in the coming years amid the ongoing foreign currency shortage and weak revenue mobilisation.

The weaknesses are compelling the government to rely on foreign credit, they said.

They stressed the need for strategic debt management to prevent repayment obligations from essential imports and investment.​