Economy
Export Sector Faces Uncertainty as Incentives Diminish and Dollar Rates Soar
Following the opening of letters of credit (LC), importers in Bangladesh are allegedly facing an additional charge of Tk12 per dollar when exchanging dollars to taka in commercial banks to release their imported items. Business leaders raised these concerns during a meeting of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) in the capital, Motijheel, with Chamber President Mahbubul Alam in attendance.
Mehdi Ali, chairman of the FBCCI standing committee on export, stated that even if an LC is opened at Tk110 (dollar rate) for the import of raw materials or machinery, the commercial banks change the conversion rate to Tk120-122 per dollar when releasing the goods from the ports. Some banks allegedly even charge extra money during the LC opening process. The significant gap of more than Tk10 per dollar is affecting the competitiveness of traders in the export market, leading to increased prices of products in the local market.
During the meeting, business leaders also expressed concerns about potential losses in the export sector if incentive facilities for export-oriented industries, such as the readymade garment industry, are discontinued. The recent reduction of cash incentives for exports by Bangladesh Bank has already raised apprehensions among entrepreneurs in the export sector.
Leaders of the garment and textile sector reportedly met with Finance Minister Abul Hassan Mahmood Ali to express their concerns over the issue.
In another meeting of the FBCCI standing committee on ports and shipping, speakers called for the reduction of complexity in the import-export process for goods and raw materials. They highlighted that the ongoing global crisis has significantly increased business operating costs in the country, causing local entrepreneurs to lag behind in international market competition. FBCCI President Mahbubul Alam emphasized the importance of quickly addressing the existing problems in the import-export process and suggested that the standing committee on exports could play a crucial role in dealing with the current dollar crisis.
Expatriate Bangladeshis sent approximately US$ 2.11 billion in remittances during the first 28 days of September in the fiscal year 2024-25, according to data released by Bangladesh Bank on 29 September.
Of this total, state-owned and specialised banks handled $679.10 million, while private banks received $1.43 billion in remittances.
Chief Adviser to Bangladesh’s interim government, Professor Muhammad Yunus, has vowed to expedite reforms and hold elections swiftly. Yunus, who recently assumed the role after the collapse of Prime Minister Sheikh Hasina’s 15-year administration, expressed his commitment during an interview with Tokyo-based news outlet NHK WORLD in New York on Sunday. He was attending the United Nations General Assembly at the time.
Following mass student-led protests that ended Hasina’s long-standing rule in August, Yunus stepped in as the leader of the caretaker government. Known for founding Grameen Bank, an institution providing microloans to the underprivileged, Yunus, along with the bank, earned the Nobel Peace Prize in 2006 for his efforts in poverty alleviation.
During the interview, Yunus emphasized that the interim government’s primary mission is to implement reforms promptly and ensure elections are held as soon as the groundwork is complete. He underscored the importance of success, stating, “Failure is not something that we can accept.”
Addressing the pivotal role of students in the ousting of the Hasina administration, Yunus acknowledged the sacrifices made by young people, referring to their involvement as part of a “revolution.” He highlighted his intention to engage the younger generation in shaping policy.
Furthermore, Yunus called for continued support from Japan, Bangladesh’s largest donor, during this crucial transition period. He stressed that Japan’s assistance is vital to stabilizing Bangladesh’s economy and fostering a democratic foundation in the nation.
Syeda Rizwana Hasan, the Adviser for Environment, Forests, and Climate Change, announced today that steps will be taken to restrict the use of polythene shopping bags to safeguard future generations.
Starting from October 1, polythene bags will be banned in shopping malls, followed by a ban in kitchen markets from November 1.
“Everyone must take responsibility and stop using polythene voluntarily. Action against polythene producers will begin from November 1,” Rizwana Hasan stated during a seminar.
The Department of Environment (DoE) organized the seminar to raise public awareness about alternatives to banned polythene bags.
Rizwana Hasan highlighted that the restriction on polythene will be executed in phases according to legal provisions, and discussions with shopping centers and store owners are ongoing to ensure a smooth transition.
She also announced plans to make the government secretariat a plastic-free zone by December.
Other speakers at the seminar included Environment Secretary Dr. Farhina Ahmed, DoE Director General Dr. Abdul Hamid, Director Rajinara Begum, President of the Shop Owners Association Muhammad Helal Uddin, and Md. Arifur Rahman Bhuiyan, Assistant Professor of Environmental Science at BUP. They discussed the harmful effects of polythene and the need for alternative products.
Earlier, Rizwana Hasan inaugurated a fair showcasing eco-friendly alternatives to polythene bags and visited 24 stalls. The fair featured products from government and private entrepreneurs, including reusable bags, jute bags, paper bags, and items made from bamboo and cane.
