Economy
Dollar Exchange Rate for Repatriated Export Income Surge to Tk107.5
The Bangladesh Foreign Exchange Dealers Association (BAFEDA) and Association of Bankers Bangladesh (ABB) have increased the exchange rate of the US dollar for repatriated export income by Tk 0.5, bringing it to Tk 107.5 per dollar. This decision was made during a meeting held on Monday, where top bank executives involved in foreign exchange transactions gathered. Since September 2022, a joint committee comprising BAFEDA and ABB has been responsible for determining the exchange rate between the taka and the US dollar, which is the world’s reserve currency. Although the intention was to establish a floating exchange rate, the system has not operated as planned.
Economists have criticized the existence of multiple exchange rates and have advocated for a single, unified exchange rate. However, the BAFEDA-ABB committee has yet to address this demand. Following the recent announcement, exporters will receive Tk 107.5 in local currency for each dollar earned through exports. In contrast, the exchange rate for expatriate income (remittances) remains unchanged at Tk 108.5. Additionally, the maximum interbank rate will continue to be Tk 109 per US dollar.
The country has been facing a dollar crisis since March of the previous year, primarily triggered by the Russia-Ukraine conflict. In an attempt to tackle the crisis, Bangladesh Bank initially fixed the exchange rate. However, this approach exacerbated the situation. In September of last year, Bangladesh Bank officially relinquished its responsibility for determining the exchange rate, transferring it to ABB and BAFEDA in consultation with the central bank. Since then, these two organizations have been collaboratively determining the dollar price for export and repatriation income, as well as import liabilities. Essentially, they are implementing decisions made by Bangladesh Bank.
The adjustment in the exchange rate for repatriated export income reflects ongoing efforts to address the dollar crisis in Bangladesh. The decision made by BAFEDA and ABB will impact exporters, who will now receive Tk 107.5 for each dollar earned through exports. While the move towards a floating exchange rate has encountered challenges, economists continue to advocate for a single, unified exchange rate to promote stability and transparency in foreign exchange transactions. The joint committee comprising BAFEDA and ABB plays a pivotal role in determining the exchange rate, working closely with Bangladesh Bank to address the complex dynamics of the country’s foreign exchange market.
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.
