The Chattogram Custom House has reported a record revenue collection of Taka 68,866.54 crore in the last fiscal year (FY24), marking a 12.25 percent growth compared to the previous fiscal year (FY23), which saw a revenue collection of Taka 61,350.44 crore.

This significant increase in revenue is attributed to enhanced vigilance measures aimed at preventing tax evasion, proper determination of customs tariffs, and fines imposed for false declarations of imported goods. Since approximately 90 percent of the country’s import and export activities are conducted through this custom house, these measures have had a substantial impact on revenue growth.

Chattogram Custom House Commissioner Mohammad Faizur Rahman highlighted the efforts made to prevent irregularities in imports and emphasized the importance of determining the accurate HS code of products to ensure proper customs duty collection. He also noted that the overall revenue collection has benefited from the realization of arrear customs duties and the resolution of pending cases.

However, he pointed out that Petrobangla, a state-owned oil, gas, and mineral resources company, owes a significant amount of arrear duty to the Chattogram Custom House. Out of a total arrear amount of Taka 14,000 crore, Petrobangla managed to pay only Taka 800 crore in the last fiscal year. Had these dues been cleared in full, the revenue collection figures could have been even higher.

The revenue collection target for the Chattogram Custom House in FY24 was set at Taka 77,616 crore. The revenue was primarily derived from duties on the import of high-speed diesel, furnace oil, apples, cement clinker, palm oil, powdered milk, scrap ships, automobiles, stones, and petroleum.

Rahman expressed satisfaction with the record revenue collection and reiterated the commitment of the Chattogram Custom House to continue its efforts to enhance vigilance and ensure the accuracy of customs duty collection.

Bangladesh is in talks with China for a loan of about $5 billion to bolster the nation’s dwindling foreign-exchange reserves, the central bank governor said, drawing the South Asian country closer to Beijing.

The funds will be denominated in yuan and give exporters access to financing they can use to pay for much-needed raw material imports from China, Governor Abdur Rouf Talukder said in an interview in Dhaka on Tuesday. The talks are at a technical stage, he added.

Bangladesh’s imports from China exceed its exports by more than 10 times, putting a huge strain on the country’s reserves. “If we get this loan, it will help us in two ways: we can settle some of the Chinese payments in yuan and it will help to build our reserves because renminbi is a reserve currency” approved by the International Monetary Fund, he said.

The country’s foreign reserves have steadily declined since the pandemic, largely due to plunging exports — garment shipments make up about 10% of the economy — and soaring prices of commodities. Bangladesh last year secured $4.7 billion in loans from the IMF, helping it ward off the kind of economic crisis that Sri Lanka went through. Still, exports remain under pressure and importers are struggling to get their hands on dollars. Fitch Ratings in May cut the nation’s credit score further into junk because of its falling reserves.

Reserves stood at $21.8 billion as of June 30, enough to cover 2.5 months of imports, according to central bank data. The IMF has set a target of 3.6 months of import cover by June 2027. Imports from China stood at $16 billion in 2023.

In his first exclusive interview since being appointed to the role two years ago, Talukder said he expects reserves to improve after September once the US Federal Reserve starts cutting interest rates. That would fuel inflows into developing markets like Bangladesh, while commodity prices have also returned to pre-Covid levels, meaning less demand for dollars to pay for imports, he said.

Prime Minister Sheikh Hasina is due to travel to Beijing next week, where funding support will likely be on the agenda. Bangladesh shares strong commercial and defence ties with China, which is the South Asian nation’s biggest trading partner.

A country of more than 170 million people, Bangladesh is heavily reliant on the garment industry and remittances from abroad for foreign inflows. Global clothing brands like Hennes & Mauritz AB, Adidas AG, Wal-Mart Inc. and Gap Inc. have operations in the country.

Under the IMF loan program, Bangladesh is required to undertake a number of reforms, including on the currency and budget to help put the economy on a stronger footing. Bangladesh Bank is moving away from a managed currency framework to help rebuild its foreign exchange reserves. In May, it introduced a crawling peg system for the taka as the first step toward adopting a free-floating currency.

Talukder said moving to a floating currency hinges on an improvement in the balance of payments — which broadly refers to the difference between the foreign inflows and outflows of a country — and reserves.

“We need to wait until the balance of payments turns positive and reserves start building,” he said. “When these conditions are met, we’ll go pretty much for the open market.”

Talukder said the central bank’s “first and foremost responsibility” is to bring inflation down to a desired level of below 6% in the current fiscal year ending in June 2025. Inflation remains around 9% despite the central bank hiking its benchmark interest rate by 350 basis points to 8.5% since May 2022.

“From July onwards, we’ll see that inflation will start declining,” the governor said.

Talukder, 60, took office in July 2022, facing a currency devaluation and inflation spike at the time. He’s since tried to bring more flexibility to market interest rates and the currency, and played a key role in helping the country secure the IMF’s loan last year.

Prior to joining the central bank, Talukder worked for 22 years in the finance ministry, including four years as the finance secretary, playing a key role in budget reform. He helped to streamline government administration, such as implementing payroll automation for employees.

For the next two years of his term, Talukder said his main goal is to clean up the banking system. Analysts have pointed to governance failures in the banking sector, which have led to high loan default rates, posing significant risks to the overall economy.

Talukder said he wants to bring the non-performing loan ratio at banks down to below 8% by the end of June 2026, from about 11% in March, and improve governance.

The cabinet committee on procurement has sanctioned the purchase of LNG cargo from the US for Tk609.27 crore. This will be the 21st LNG cargo imported this year, Cabinet Secretary (Coordination) Mahmudul Hossain Khan announced following a cabinet meeting on 3 July.

The meeting, presided over by Finance Minister Abul Hassan Mahmood Ali, approved a total of nine proposals. The procurement committee had solicited quotations from companies with existing master sales and purchase agreements with the government. After evaluating the proposals, Excelerate Energy from the US was awarded the contract, quoting a price of $13.5580 per MMBtu of LNG. Previously, LNG was purchased at $12.9697 per MMBtu.

Additionally, the committee approved an agreement between Sylhet Gas Fields Limited (SGFL) and Sinopec International Petroleum Service Corporation of China. This agreement pertains to the drilling of the Sylhet-11 (Development Well) and Rashidpur-13 (Exploratory Well) under the Energy Department’s proposal. The project will be executed according to the Quick Enhancement of Electricity and Energy Supply (Special Provision) Act, 2010, with an estimated expenditure of Tk444.85 crore.

Other approved proposals include the state-level purchase of DAP and MOP fertilizers from Saudi Arabia and Russia, the acquisition of project package number RPW-1.2 for the “Greater Dhaka Sustainable Urban Transport Project (BRT, Gazipur-Airport),” and the construction of a multi-storied residential building for the cleaners of Dhaka North City Corporation at Gabtali City Palli.