Economy
DCCI President Affirms Bangladesh’s Resilience Amid Economic Challenges
Dhaka Chamber of Commerce and Industry (DCCI) President Ashraf Ahmed expressed confidence in Bangladesh’s ability to overcome current economic challenges. He acknowledged issues such as inflation, non-performing loans (NPL), foreign exchange reserves, financial market volatility, balance of payment, and the depreciation of the currency but emphasized that Bangladesh has successfully faced similar challenges in the past.
During a press conference organized by DCCI, Ashraf highlighted that while inflation, foreign exchange reserves, NPL, and liquidity are indeed significant challenges, Bangladesh has a proven track record of overcoming such economic obstacles. He also addressed the energy crisis, emphasizing the negative impact of manufacturing industries’ closures due to power shortages on economic capacity.
Ashraf called for the swift resolution of the energy crisis and emphasized the need for data transparency improvement in the Bangladesh Bureau of Statistics (BBS) and other relevant sectors. He suggested that both the private and public sectors need to collaboratively address economic challenges, with the private sector playing a pivotal role in stabilizing and reviving economic growth.
To promote the development of import substitute industries, Ashraf recommended expanding access to finance for cottage, micro, small, and medium-sized enterprises (CMSMEs) and industrial startups through dedicated credit lines, loan guarantees, and venture capital initiatives. He also proposed measures such as export diversification, export factoring, inter-bank foreign currency exchange, incentivizing remittance inflow, and promoting the Alternative Trade Board (ATB) for trading infrastructure.
Ashraf expressed optimism about the implementation of the new monetary policy stabilizing the macroeconomic scenario and relieving inflationary pressure. He urged continuous efforts for inclusive growth, export base diversification, and policy focus on stimulating growth. Additionally, he called for the synchronization of accounting and reporting processes with the tax code and the formulation of a long-term, time-bound, sector-specific national investment roadmap for key industries like Agriculture, Pharmaceuticals, Electronics, Light-engineering, IT & ITES, and the RMG industry to boost private investment.
During the eleventh month of the current fiscal year, the country’s foreign currency reserves have fallen below $19 billion for the first time. After paying off some import bills, the reserves have now stood at $18.26 billion on Sunday.
According to the International Monetary Fund (IMF), as of May 8, the total foreign currency reserves of the country were $19.82 billion.
Mohammad Mezbauul Haque, the spokesperson of Bangladesh Bank, informed that through the Asian Clearing Union (ACU), the central bank has paid off import bills totaling $1.63 billion over the past two months.
However, Bangladesh Bank maintains that after paying off the import bills, the foreign currency reserves now stand at $23.71 billion.
According to the Central Bank’s accounts, the reserves were $25.27 billion on May 8.
The Dhaka Stock Exchange (DSE) and the DSE Brokers Association (DBA) have expressed gratitude towards Prime Minister Sheikh Hasina for her directive to list government companies in the capital market, a move hailed as timely and positive.
The directive was issued during the recent meeting of the Executive Committee of the National Economic Council (Ecnec) last Thursday.
Dr. Hafiz Muhammad Hasan Babu, Chairman of DSE, described the directive as a significant step towards enhancing the dynamics of the capital market. He emphasized that besides invigorating the capital market, this move would also attract foreign investment and promote sustainable development.
Despite previous efforts, government institutions had not been listed in the stock exchange, according to a notification issued by the DSE. The Prime Minister’s directive is seen as a pivotal step towards revitalizing and expanding the economy.
Dr. Babu further remarked, “The listing of reputable companies in the capital market, as directed by the Prime Minister, will greatly benefit the country’s economy. It will also enhance investor confidence.”
Similarly, the DBA released a notification applauding the Prime Minister’s directive, terming it as positive and timely for the capital market.
Saiful Islam, President of DBA, expressed optimism about the directive’s potential to accelerate the country’s capital market and overall economy. He pledged support to relevant government departments and regulatory bodies in implementing the directive, ensuring its positive impact on the economy, including the capital market.
India has expressed interest in financing Bangladesh’s Teesta project, announced Foreign Minister Hasan Mahmud. Speaking to reporters after a meeting with Indian Foreign Secretary Vinay Mohan Kwatra, Mahmud stressed the importance of aligning the project with Bangladesh’s needs. He confirmed discussions on the Teesta issue during the meeting. Mahmud also affirmed Prime Minister Sheikh Hasina’s upcoming visit to New Delhi, indicating that the finalization of the date would depend on the formation of the new Indian government following ongoing elections.
Meanwhile, the IMF has approved a $1.15 billion staff-level loan for Bangladesh in its third tranche. Mahmud noted the ongoing elections in India and the subsequent formation of the new government as factors influencing the scheduling of PM Hasina’s visit.
When asked about the sequence of visits to India and China, Mahmud suggested Delhi’s geographical proximity to Bangladesh. Diplomatic sources suggest PM Hasina’s visit to India is planned for early July, following India’s elections.
Pre-election surveys indicate strong prospects for Indian Prime Minister Narendra Modi’s re-election. Modi previously congratulated PM Hasina on her electoral victory in January, expressing optimism about strengthening ties between the two nations.
The last bilateral engagement between the prime ministers occurred during the G-20 Leaders Summit in September 2023. Modi is expected to invite South Asian and BIMSTEC leaders to his swearing-in ceremony, fostering regional cooperation.
Addressing border killings, Mahmud emphasized the government’s commitment to ending such incidents and promoting the use of non-lethal weapons by border forces. Discussions also covered enhancing physical and people-to-people connectivity, including cooperation with India to import hydropower from Nepal and Bhutan through India. Mahmud highlighted the need to further ease visa restrictions to strengthen people-to-people relations.
