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BBA Discussion Forum / Bull surges ahead
« on: February 26, 2020, 09:15:01 AM »
tocks take 2nd biggest jump in 7 years, turnover 12-month high

The country’s prime bourse on Sunday gained 3.71%, the second biggest since the broad index was introduced seven years ago, under the impacts of post office savings tools rate cut and banks' special fund for stock market.

DSEX, the key index of Dhaka Stock Exchange (DSE), gained 169.54 points or 3.71% on the day to end at 4,734.15 points.

The index was launched on January 27, 2013 with 4,056 as base points. The first biggest gain of the index in a single day was 234.23 points on January 19, 2020.

Sunday's turnover stood at Tk916 crore, up by 25% over previous day’s mark of Tk730 crore. It happens to be the biggest single-day transaction in the last 12 months since February 14, last year, when the turnover totaled a record Tk932 crore.

Market insiders said the central bank’s supportive measures coupled with government moves to divest shares of selected state-owned entities boosted investor’ confidence in the market.

The news that Asian Development Bank (ADB) would lend $170 million more to assist the country’s ongoing capital market reforms also encouraged the investors, they said.

High official of top brokerage houses, talking to Dhaka Tribune, as the interest rate on savings in post office was halved, people would feel encouraged to invest in stock market.

Bangladesh Bank on February 10 issued a circular, allowing scheduled banks to form a special fund of Tk200crore each for investment in the capital market.

The fund can be drawn from the bank’s own resources or borrowing money from the central bank through Treasury bill or bond repurchase agreements or repos at a 5% interest rate.

These initiatives opened up an opportunity to bring a fresh investment of Tk12,000 crore from all 60 banks in the country, market operators said.

Beside, the Asian Development Bank (ADB) on Saturday approved a second tranche loan of $170 million to conclude the Third Capital Market Development Program in Bangladesh.

UCB Capital Management Limited in its daily market commentary said that the market advanced 3.7%  riding on large caps such as Brac Bank, Square Pharma and BATBC.

“Liquidity support fund by the Bangladesh Bank and interest rate slash on fixed deposit of post office has paved the way for new investment in the market,” it also said.

All major sectors including bank, pharmaceuticals, telecommunication, food, energy, textile, engineering and life insurance increased on Sunday.

The market-cap of the DSE also rose by Tk8,465 crore to Tk3,55,531 crore, from Tk3,47,066 crore in the previous session.

EBL Securities Limited in its daily market commentary said that the market gained further momentum on Sunday as investors showed frenetic enthusiasm to inject new funds in the market in the hope of capital gain in the ongoing bull run.

Two other indices of Dhaka bourse also ended higher. The DS30 index, comprising blue chips, rose 169.54 points to finish at 1,592 and the DSE Shariah Index soared 29.92 points to close at 1,045.

Among the traded issues, 293 gained, 40 declined and 23 remained unchanged during the session in DSE.

LafargeHolcim Bangladesh Limited secured the leadership position on the top turnover chart. Orion Infusion Limited secured the highest gain of 10% during the session. Alltex Industries turned out to be the worst loser with its price declining 7.86%.

The port city’s bourse, Chittagong Stock Exchange, also ended in upswing mood. The selected index, CSCX, and all share price index, CASPI, advanced by 325.7 and 533.7 points respectively.

The declaration followed the 4th Summit of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (Bimstec) held in Kathmandu, Nepal, on Thursday and Friday

Leaders of the Bay of Bengal regional group on Friday emphasized the importance of the blue economy and agreed to cooperate in this sector for the sustainable development of the region.

The declaration followed the 4th Summit of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (Bimstec) held in Kathmandu, Nepal, on Thursday and Friday, reports UNB.

Bangladesh Prime Minister Sheikh Hasina was among a a high level delegation to the summit which also included the prime ministers of India, Nepal, and Thailand, the presidents of Myanmar and Sri Lanka, and the chief adviser of Bhutan.

Together, the leaders agreed to establish an Intergovernmental Expert Group to develop an action plan on the blue economy, keeping in mind the special needs and circumstances of Bhutan and Nepal - the two landlocked Bimstec member states.

The move follows the successful hosting of the International Blue Economy Conference by Bangladesh in 2017, when Bimstec member states were present.

In Nepal, the Bimstec leaders also reiterated their commitment to the eradication poverty in the Bay of Bengal Region by 2030, in line with the 2030 Agenda for sustainable development.

They called for effective implementation of the Bimstec Poverty Plan of Action, and for gearing up efforts of all sectors to contribute to the overarching goal of poverty alleviation.

The Bimstec leaders also expressed commitment to nurturing their workforce, by taking concrete measures to provide decent job opportunities through increased investment in the service and productive sectors.

Trade and investment

The leaders renewed their commitment to an early conclusion of Bimstec Free Trade Area (FTA) negotiations.

They directed the Bimstec Trade and Economic Ministerial Meeting (TEMM) and its subsidiary bodies, including the Trade Negotiating Committee (TNC), to finalize all related agreements of the Bimstec FTA as early as possible.

They expressed their satisfaction with the progress of negotiation on the agreement on Trade in Goods and the Agreement on Customs Cooperation, and directed respective ministries/agencies to regularly in TNC meetings regularly.

They also agreed to revitalize the activities of the Bimstec Business Forum and Bimstec Economic Forum, and tasked the expert group on Bimstec visa matters to continue negotiations for finalizing modalities for the Bimstec Visa Facilitation.

They welcomed the offer of India to host a Bimstec Startup Conclave in December 2018, and encouraged all member states to participate.


The Bimstec leaders reiterated their resolve to establishing seamless multimodal transportation links and smooth, synchronized and simplified transit facilities.

They decided to direct their respective authorities to speed up their efforts to conclude the Bimstec Coastal Shipping Agreement and the Bimstec Motor Vehicle Agreement as soon as possible.

The leaders noted with satisfaction the preparation of the draft Bimstec Master Plan on Transport Connectivity and called for its early adoption, and thanked the Asian Development Bank for providing support for the preparation of the Master Plan.

They agreed that the Master Plan would serve as a strategic document that guides actions and promotes synergy among various connectivity frameworks, such as the Asean Master Plan on Connectivity 2025 (MPAC 2025), the Ayeyawady - Chao Phraya- Mekong Economic Cooperation Strategy (ACMECS).

The leaders also decided to establish a Working Group to deal with information technology and communications related matters, with a view to providing the people of the region with a greater access to more affordable and high-speed internet and mobile communications.

In this regard, they welcomed the offer of the Government of India to host a Bimstec Ministerial Conclave at the India Mobile Congress 2018, to be held in New Delhi from October 25-27. The theme of the conclave will be “New Digital Horizons: Connect, Create, Innovate”.

Transnational crime

The leaders reiterated their position that terrorism continues to pose a serious threat to peace and stability in the region.

They reaffirmed their strong commitment to combating terrorism in all forms, and agreed to take appropriate measures in this regard.

Furthermore, the leaders called upon member states to work towards the early ratification of the Bimstec Convention on Mutual Legal Assistance in Criminal Matters.

In addition, the leaders decided to hold meetings at the level of Bimstec Home Ministers, and continue with the Bimstec National Security Chiefs meetings.

Environment and disaster management

The Bimstec leaders encouraged closer cooperation in disaster management through the sharing of information, including on early warning systems, preventive measures, rehabilitation and capacity building.

They also decided to establish an Intergovernmental Expert Group to develop a plan of action to improve preparedness and coordination for responding to natural disasters in the Bay of Bengal region.

Climate change

The leaders expressed serious concern over environmental degradation and the adverse impact of climate change.

They explored the possibility of establishing an Intergovernmental Expert Group to develop a plan of action for a collective response to climate change.

They also reaffirmed their commitment to implementing the Paris Agreement on dealing with greenhouse-gas-emissions mitigation, adaptation, and finance, starting in the year 2020.


The leaders recognized the high potential of energy resources in the region, particularly renewable and clean energy sources.

They decided to constitute an intergovernmental group of experts to enhance energy cooperation, including in hydro-power and other sources of renewable energy.


The Bimstec leaders agreed to enhance cooperation for the development of, access to and sharing of affordable technology, particularly for micro, small and medium enterprises.

However, they said the need to address the disruptive impacts of technology should be kept in mind. 

They also welcomed the efforts of member states towards the signing of the Memorandum of Association on the establishment of Bimstec Technology Transfer Facility in Sri Lanka.


The leaders decided to deepen cooperation in agricultural and allied sectors, including crops, livestock and horticulture, farming machinery, and harvest management.

They tasked the relevant authorities with intensifying cooperation with the aim of attaining food and nutritional security.

People-to-people contacts

The leaders resolved to build a deeper understanding and trust between member states, and promote people-to-people contacts at various levels.

They noted with satisfaction the activities of the Bimstec Network of Policy Think Tanks (BNPTT) in enhancing public awareness about Bimstec, and directed the relevant agencies to finalize the terms of reference (ToR) of BNPTT.

They agreed to explore the possibility of establishing appropriate Bimstec forums for parliamentarians, universities, academia, research institutes, cultural organisations, and the media community, to expand the scope of people-to-people contacts.

Discussants at the program pointed out that fishing vessels could now go maximum 60 kilometers into the sea and because of this fishing near the shore line was harming and disturbing the balance of sea fisheries

Bangladesh has a huge economic potential in the Bay of Bengal but failed to make the most of resources from the sea for lack of initiative and investment.

The observation came at a seminar titles “Blue economy: Future prospects of harnessing the opportunity for Bangladesh” at a hotel in the capital on Monday.

The Centre for Strategic and Development Studies (CSDS) organized it.

Discussants at the program pointed out that fishing vessels could now go maximum 60 kilometers into the sea and because of this fishing near the shore line was harming and disturbing the balance of sea fisheries.

On the other hand, they mentioned, valuable Tona fish in the deep sea remained out of reach while neighboring countries were fishing illegally in the sea areas of Bangladesh.

Kawser Ahmed, professor of the department of oceanography of the University of Dhaka said: “Tona fish live in 250-350 metres deep in the water and we have to go to 100-150 kilometres away from the shore to catch Tona."

Rear Admiral Md Khurshed Alam, secretary (maritime affairs unit) of the ministry of foreign affairs said: “We have 70,000 wooden fishing boats which can go up to 20-25 kilometres from the shore. We also have 240-250 steel body fishing trawlers which can go up to 40 kilometres and some can go to 60 kilometers maximum."

“Not a single fishing ship we have which can go into deep sea. We cannot catch Tona fish for lack of fishing facilities,” he said.

He urged private sector to invest in fishing ship.

Khurshed Alam presented the keynote in the seminar and said: “We can produce 15 lakh tons of salt but cannot export for being bellow standard. We do not even have technology to track a foreign ship into our sea areas. We took no initiative to collect minerals from the sand."

Asset harnessing

Major General (retd) Amsa Amin, chairman of CSDS, who moderated the seminar, said: “Estimated gross value added to our economy was 6.2 billion dollars in 2014-2015. Of it, tourism added 25%, transport 22%, marine capture fisheries and aquaculture 22%, oil and gas 19%, ship building and breaking 9% and mineral 3%."   

Sea is producing 3.3 million tons of fish for Bangladesh which provides 56% of animal protein intakes. Sea fisheries and aquaculture is contributing 4.6% of national GDP and supporting the livelihood of 13 million people. It also contributes 5.1% of the country’s foreign exchange earnings.

BBA Discussion Forum / BB issues directives on 9% lending from April
« on: February 26, 2020, 09:11:33 AM »
No instruction on 6% deposit; economists, bankers critical of capping rates

The Bangladesh Bank on Monday asked scheduled banks to charge highest 9% interest for all types of lending, barring credit cards, to help expand business and economy.

The dictated lending regime would be effective from April 1, said a BB circular.

Senior bankers and economists are critical of the BB decision, saying the dictated 9% loan will squeeze the loan growth in the economy.

The central bank, however, refrained from imposing the 6% deposit rates across the board, backtracking on its earlier decision taken last month in a meeting with stakeholders, including bankers, BB and the finance ministry.

“We are not going to ask banks to fix deposit rates. Let banks themselves fix the rate at their convenience,” an executive director of the BB, requesting anonymity, told Dhaka Tribune.

“We are concerned about lending rates as it has direct consequence on business, economy and employment generation.”

The BB in its circular said current high bank interest rate regime was weighing on the country’s small, medium and large industries badly.

“Due to high interest, cost of doing business is escalating and industries are losing their competitiveness,” reads the circular.

The grave situation, typically caused by the exorbitant bank interest, made many bank borrowers fail to repay the bank loans, added the circular.

According to the circular, the latest directives will not be applicable for classified loans.

A 2% additional interest could be charged by banks in case any borrowers enjoying the 9% interest became defaulters, added the circular.

It said the existing 7% rate on export-oriented sector would remain unchanged.

Warning the scheduled banks, the BB circular said banks could not lower their lending amount in the industrial sector including the manufacturing sub-sector under the small and medium enterprises after the implementation of the 9% rate.

In this regards, the average yearly lent amount in the specified sectors based on the last three years total lending would be the basis for calculating the yearly lending amount, clarified the circular.

On January 29, bankers came up with a decision after a meeting that they agreed to provide not more than 6% interest on bank deposits from February 1 but banks would not follow the 6% interest rate for deposit pension schemes (DPS).

Talking to Dhaka Tribune, Southeast Bank Managing Director Kamal Hossain said: “BB made a proper decision by not imposing the deposit rate. As a result, banks can collect deposit at their convenience.”

However, eminent economist Zahid Hussain differed with the BB’s directives on capping the interest rates.

“If the central bank caps the interest rates on loans, it may affect the whole banking sector,” said the former lead economist at the World Bank, Bangladesh.

Zahid Hussain suggested that the government and the central bank should rather focus more on reducing the high amount of defaulted loans.

Interest rates on lending would be reduced if the high amount of defaulted loans was lessened, he added.

“It is not implementable. Banks will not invest much, as they will be unable to implement the 9% lending rate after collecting deposits at higher rates,” Syed Mahbubur Rahman, former president, Association of Bankers, Bangladesh.

The non-performing loans (NPLs) rose by Tk420 crore in 2019 over last year, according to the central bank data.

On February 2, Association of Bankers, Bangladesh (ABB) President Ali Reza Iftekhar said that bringing interest rates on small loans down to single digit would be difficult, as the cost of lending in the sector was very high.

“The supervision costs for financing the small enterprises is very high compared to other sectors,” said Ali Reza Iftekhar.

He said most of the banks that lent to small enterprises would find the single digit interest rate difficult to apply, as they lent money mostly to NGOs (non-government organizations).

On December 30 last year, Finance Minister AHM Mustafa Kamal said that the lending rate would be as high as 9% and deposit rate maximum 6% with effect from April 1.

On January 20, the finance ministry instructed the autonomous, semi-autonomous and government companies to keep 50% of their surplus funds at 6% interest rate with private lenders and the remaining half of their deposits will go to state banks, which can offer no more than 6% interest to facilitate banks to charge 9% for loans from April 1.

BBA Discussion Forum / The environmental cost of urbanization
« on: February 26, 2020, 09:11:10 AM »
Dhaka, the capital of Bangladesh, has lost around 75% of its wetlands in the last 40 years or so, due to encroachment for urbanization purposes

The most defining trait of humans is perhaps the ability to think, formulate and come up with solutions that will make life easier by bending nature to their will.

While Homo sapiens is not the only species to have the ability to come up with ideas or create tools to achieve their desired objectives, no one else has the capacity to do so on the same scale as us. We humans have overcome almost every obstacle nature has put in front of us so far – we created fire to overcome the cold, made hunting and cooking tools to overcome hunger, and we built communities to overcome solitude.

However, in this march of progress and continuous struggle to overcome the natural environment, we have forgotten how to take care of the world. As a result, we stand today at the precipice of a major challenge: how to continue this progress without causing further damage to our environment.

As a nation that is on the rise, overcoming this hurdle is perhaps even more daunting, since we face a great risk from environmental damage and we have not always had the best record when it comes to clean and resilient growth. In fact, Bangladesh has one of the highest pollution rates, and Dhaka is ranked the second worst in terms of air quality. According to a 2018 World Bank report, the capital of Bangladesh lost around 75% of its wetlands in the last 40 years or so, due to encroachment for urbanization purposes. This has put the entire city and its neighbouring areas at great risk of flood, and high-rise apartments in those areas are at risk of earthquake damage. But curtailing the pace of that growth was not really an option before as slowing down could have meant stalling the development of the country. And even though Bangladesh has made significant progress in sustainable development, there is still quite a lot of room to improve and, of course, to implement.

At any point in time in Dhaka or Chittagong, over the last decade or so, there have been at least 50 or so construction projects running simultaneously. During every part of the construction process – clearing of land, demolition of existing structures, excavation of land, movement of machinery and equipment, materials used – particulates are emitted; most of them are PM10 (10 microns) or PM2.5 (2.5 microns) types, which can be quite devastating for humans.

The real estate business in Bangladesh – Dhaka in particular – has been booming since the late 2000s. The rush for apartments has resulted in the creation of many high-rise properties, and there is still no sign of the rush slowing down as, after Bashundhara R/A, Mirpur and Uttara, the city now focuses eastward. But aside from the continuous construction of small to large residential buildings and projects, the numerous ongoing infrastructural development projects are greatly contributing to the environmental deterioration of the city.

At least 18% of the pollutants are emitted from road and soil dust, a great deal of which can be attributed to, in some way or another, infrastructural development. For residents of the capital city, the metro rail project has been the bane of their existence over the past few years. Although the project was inaugurated in June 2016, the construction properly began in 2017. Since then, the MRT-6 project, which is to run from Uttara to Motijheel via Mirpur and Farmgate, has become one of the primary sources of air pollution in the city, especially in the areas where the tracks are being constructed. There are also plans to build even more metro rails throughout the city, albeit underground. How much impact they will have on the air quality of the city still remains to be seen.

However, these are not the only ongoing projects that are contributing to the worsening of air quality. The elevated expressway, which has seen only 22% of its construction complete in the last eight years, as well as the construction of BRT Lines, outer, inner and middle rings, numerous flyovers – all of them continue to contaminate the air we breathe, and each of these projects is necessary for the development of the city.

A solution to this conundrum has been necessary for decades, but the inability to come up with a solution is not for the lack of trying. Bangladesh is working around to clock to introduce more green and sustainable construction techniques as well as using eco-friendly materials. The government has already begun using green bricks in their projects and plans to use such bricks in 100% of their projects. Another step the government is trying to take is to time the construction of these projects. While there is a common notion that all construction projects take place or start during the rainy season to cause more hassle for the people, that can, in fact, be the right time to begin and hopefully end the necessary construction.

Historical data, as per the Air Quality Index (AQI), shows that the months of November, December, January and February tend to have the worst air, and the AQI score is way over 300 which is considered “Hazardous.” This is also the driest period of the year. On the other hand, air quality gets better in the middle of the year, from June to August, thanks to rain preventing excess floating particles. So, even if completing the project is not possible during this time, much of the environmental impact that stems from the early parts of construction can be reduced. But to the chagrin of the people, this time frame is rarely followed and citizens end up suffering throughout the year.

So, while a majority of today’s focus is put on brick kilns – and deservingly so – when it comes to polluting the air, the environmental impact from development and construction of roads and infrastructure needs to be brought in the limelight as well. We have reached an alarming stage today, not just locally but globally. But while others are making leaps in green development, we are not even taking quick steps. Sacrificing nature for progress is not an option for us, and we need to ensure that the environmental cost of urbanization does not outweigh its benefits and value – for us or our future generations.

BBA Discussion Forum / Can we turn the clock back?
« on: February 26, 2020, 09:10:38 AM »
The latest figures, which were published in 2014, show that every citizen in Bangladesh produces about 0.44 tons of carbon dioxide

Could you, or I, or any of us do anything to change the course of history and prevent the massive environmental damage that has been done since the spark of the industrial revolution? Probably not. The march of civilization took a giant leap when the power of steam and coal was harnessed, and that march was unstoppable. It has fuelled all the conveniences and technologies we enjoy today, but, as we now know, it also ignited the rapid deterioration of climate.

We have reached an alarming stage – on the verge of global catastrophe – hoping and wishing to turn the clock back on the damage we have caused to our precious environment. Even though things may seem dire, we still have not reached the point of no return. We must begin to take measures to reduce our carbon footprint, and just as charity begins at home, we too need to be more “green” at home, where a majority of our lifestyle is focused, so that we may reverse the negative environmental effects as best we can on such a small scale.

To put our home’s carbon footprint into perspective, let us take a look at a few numbers.

Using a refrigerator/freezer for 24 hours can produce 116kg of carbon dioxide (CO2) a year, the microwave oven used 96 times a year will produce 39kg, 187 washes in the washing machine produces 51kg, and 148 uses of a dryer emits 159kg of CO2. In the US, construction of a two-storey cottage emits about 80 tons of CO2, in the UK that number is 50 tons, and the average operational carbon emission of individual flats in the UK is about 80 tons.

While the corresponding numbers in the context of Bangladesh are not available, it is safe to assume that, as a rapidly developing nation, our numbers are not that far behind. The latest figures, which were published in 2014, show that every citizen in Bangladesh produces about 0.44 tons of carbon dioxide. The current number should be much higher as vehicle usage, technological dependency and an overall change in lifestyle have taken place between 2014 and 2020.

From the moment we wake up and even after we lie down on the bed to sleep, we unintentionally leave behind a tremendous amount of carbon footprint. A majority of that footprint stems from unnecessary or excessive usage of electricity. As already mentioned, everyday appliance usage can produce a lot of CO2. Even standard 100W light bulbs produce about 63kg of CO2 in every four hours of usage.

Since there are many electronic items that are imperative to our daily life, finding greener alternatives that use fewer resources are necessary. As much as 75% energy can be saved by simply substituting standard incandescent bulbs with LED lights. The same can be done by using air conditioners with built-in inverters that regulate energy consumption. While such items cost a bit more than your standard household things, but they use fewer resources in the long run – thus saving both your money on electricity bills and the environment.

Another way to reduce electricity consumption is to simply be a bit more cautious of our actions. How many electronic devices do you currently have plugged in your home or even in your office? Do they all need to be plugged in? According to studies, there are usually 40 or so products in each household that constantly draw power. Phones, blenders, toasters, laptops, computers or even televisions – we tend to keep them plugged in for longer than necessary. We pay little attention to them. But keeping them plugged in leaves them in a stasis where they continue to draw electricity – a phenomenon referred to as “phantom power.” As much as 10-12% of electrical usage per month can be reduced if we only take some time to unplug the items of our homes.

While we are at it, installing solar panels to move toward clean energy is the right course of action for today’s homes. Not only is this a renewable energy source, but it also does not produce any pollution or waste.

Water conservation is also an important factor if we are serious about reversing existing negative environmental effects. Worldwide, we use over 10 billion tons of freshwater every day, and according to some reports, as much as 95% of the water that enters our home goes down the drain! Keeping the tap unnecessarily running is a major problem and wastes a lot of water every day. Leaky water taps are also another culprit, along with washing machines. The amount of water used in a washing machine far exceeds the required volume. So instead of using a machine, wash clothes manually and use the power of the sun to dry them. Another step to conserve water is to not waste food. Yes! Around 45 trillion gallons of water, used to grow 1.3 billion tons of food, is wasted every year. So whenever we decide to waste food, we are indirectly wasting a great deal of water.

While there are plenty of ways to reduce usage and wastage to lessen our carbon footprint, there is only one major path we can take to enable the environment to regain its former beauty – forestation and plants. Planting trees is the only way to move forward and the only way to compensate for necessary energy usage. We need to use technologies and items necessary for the march of progress and its inevitable carbon footprint. However, along with adopting green measures, planting trees will impede the negative environmental effects and afford us the opportunity to build a more environmentally cohesive ecosystem.

So, for starters, begin the forestation steps at home. Have plants in your home, and little by little, they will add up to create a greener environment. The goal is to achieve “Net-zero energy buildings” where zero energy is consumed and considerably less amount of greenhouse gases is generated. Until then, we need to do our parts and try to turn the clock back on our existing damages.

Business Administration / BB spurs banks to attain farm credit target
« on: February 26, 2020, 09:09:51 AM »

The instruction came at a meeting with senior officials of the banks at BB headquarters in the capital on Monday

Bangladesh Bank (BB) has instructed all private commercial banks and foreign banks for taking effective measures to achieve their agro-credit disbursement targets by the end of this fiscal.

The instruction came at a meeting with senior officials of the banks at BB headquarters in the capital on Monday.

BB Agricultural Credit Department General Manager Md Habibur Rahman chaired the meeting.

The banks, whose disbursement performance was below 50%, made a commitment to achieving their targets by the end of fiscal year, according to a meeting source.

“We will closely review the banks’ performance to help them achieve their targets by the end of FY 20,” said a BB official.

He said the central bank would take action against the banks if they failed to achieve their farm-loan disbursement targets by the timeframe.

The BB's latest moves came against the slow trend in farm credit disbursement in recent months.

During July to January period of this fiscal year, private commercial and foreign banks disbursed Tk6,850.56crore to the farm sector, which is 49.83% of its fiscal target.

However, eight state-run banks disbursed Tk6,253.71 crore or 60.28% of its fiscal target, according to the central bank data.

The Bangladesh Bank set the farm credit disbursement target for the current fiscal year at Tk24,124 crore or 10.66% up from previous fiscal year.

Loan disbursement to the sector rose by Tk1,003.23 crore, up from Tk12,101.04 crore in the same period of 2018-19 fiscal year, according to the Bangladesh Bank data.

The disbursed volume amounted to 54.32% of the target set for the 2019-20 fiscal year.

An increased flow of agricultural loans could give a major boost to the overall economic development of the country, says a study by the Bangladesh Institute of Bank Management (BIBM). 

As agriculture is a labour-intensive sector, its increased accessibility to long-term finance can make substantial contribution to the gross domestic product (GDP) of the country, it observes.

If banks and other non-banking financial institutions invest more in the agriculture sector, more people could be employed. This will help reduce the poverty rate and develop the rural economy, says the study.


BIMSTEC Secretariat in collaboration with the South Asia Regional Initiative for Energy Integration (SARI/EI) of USAID organized the two-day event at its office in the capital

Coordinated regional grid connection would help attain the continued growth in power generation among the member countries of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), experts and policy-makers said on Tuesday.

Governments of the member countries of the regional block must focus on renewable energy to ensure sustainable development in the BIMSTEC region, they suggested while addressing a conference on "Enhancing Energy Cooperation in the BIMSTEC Region”.

BIMSTEC Secretariat in collaboration with the South Asia Regional Initiative for Energy Integration (SARI/EI) of USAID organized the two-day event at its office in the capital.

Prime Minister's Energy Adviser Tawfiq-e-Elahi Chowdhury said it was high time BISTEC had a regional power grid as part of energy operation among the member states.

“Such an electricity network will not only ensure quality supply of power at a lower cost, but also enhance energy efficiency,” he said.

“It is not that some of the BIMSTEC members will export electricity to other members. Rather the proposed grid will smoothen export and import of electricity,” he said.

For instance, the country could export electricity to Nepal during winter when the demand for power drops significantly, he said, adding: “On the other hand, Bangladesh needs more electricity during summer when it can import from Nepal.”

“Without funding, regional grid will never be possible,” he asserted.

The BIMSTEC is a regional block, comprising Bangladesh, Bhutan, India, Myanmar, Nepal, Sri Lanka and Thailand.

On 31 August 2018, the member countries struck a memorandum of understanding (MoU) for installing the BIMSTEC Grid Interconnection to enhance energy cooperation among them.

BIMSTEC Secretary General M Shahidul Islam said the platform could play a massive role in establishing an integrated power grid for the region.

Moderating a session, former foreign secretary Farooq Sobhan said the BIMSTEC role was crucial to steer the region’s economic growth.

“In the era of climate change, we also need to focus more on renewable energy for sustainable growth and energy,” he observed.

USAID’s Bangladesh Mission Director Derrick S Brown, India’s Joint Secretary at Ministry of Power Tanmay Kumar, Babu Raj Adhikari of Nepal’s Energy Ministry, Sri Lankan Additional Energy Secretary Merrille Goonetilleke, and Myanmar Oil and Gas Planning Department Director Tin Zaw Myint, among others, spoke at the program.

Dhaka Tribune is the media partner of the conference.

By 2031, it aims to bring down the extreme poverty rate to 2.55%, and increase the GDP growth to 9%

The government has set targets to bring down the extreme poverty rate to 0.68%, and increase the gross domestic product (GDP) growth to 9.9% by 2041. 

By 2031, it aims to bring down the extreme poverty rate to 2.55%, and increase the GDP growth to 9%. 

The projections incorporated in “Bangladesh’s 2nd Perspective Plan 2021-2041,” was approved on Tuesday. The plan envisages the target to become a developed country  by 2041.

Chaired by Prime Minister Sheikh Hasina, the National Economic Council (NEC) approved the country’s second perspective plan to turn Bangladesh as a higher middle-income country by 2031 and a higher income and developed country by 2041.

For graduating  the country  to higher income status, the government has put emphasis on sustainable electricity and energy, while for rapid and continued growth it also stresses development of roads and transport and infrastructure.   

After the meeting, Planning Minister MA Mannan briefed the media on the document for the next 20 years, a pathway to become a developed country. The document is based on four pillars — governance, democratization, decentralization and capacity building.

“The document is framed and approved to alleviate poverty, strengthen good governance further and transform Bangladesh into a modern and world-standard digital country,” said Mannan.

As per the Bangladesh’s 2nd Perspective Plan 2021-2041, the extreme poverty rate in the country was expected to reduce to  2.55% in 2031 from 9.38% in 2020 (base year), while it was expected to come down further to 0.68% in 2041, the minister said.

On the other hand, Mannan said the government set target to attain 9% GDP growth by 2031 while it would further expect to grow at 9.9% in 2041. The base year is 2020.

In the last fiscal year, Bangladesh attained 8.15%, while in the current budget for fiscal year 2019-20, the government set target to attain 8.20% GDP. 

According to the second perspective plan, the country’s per capita income on current price would stand at $12,500 by 2041.

In addition, moderate poverty rate is projected to come down to  7% in 2031 and to 3% in 2041.

The plan also set target to reduce the income inequality to 2.80%, 2.75% and 2.70% by 2025, 2031 and 2041 respectively.   

To take the advantage of demographic dividend and develop   human resource through quality education, the government in the plan set target to provide free education for all aged up to 12 years, 100% literacy, low cost health insurance  and treatment facility for all.     

Meanwhile, to cope up with the global changes in the information technology, the meeting focused Fourth Industrial Revolution (4IR) and ICT, skills development, while attention has been given to agriculture, rural poverty eradication, education and researches, and tourism infrastructures.

General Economics Division (GED) member of the Planning Commission Dr Shamsul Alam said the Perspective Plan was  a historic and dream document for the country as it gave a guideline about what would be the socio-economic position of the country over the next 20 years.

As per the 2nd Perspective Plan, the inflation rate will come down to 4.51% by 2031 and 3.96% by 2041, while the country’s export earnings to increase to $150 billion by 2031 and $300 billion by 2041

Customs officials say in a program

The customs will make submission of bill of entry mandatory by importers within 72 hours of export and import of goods, and provision of penalty will be incorporated in customs act if any importer fails to submit the bill in time.

Currently, it takes up to 10 days to submit bill of entry by the importers in the customs port, which causes unusual delay in releasing goods.

This was said in a program titled ‘Ease of doing business: Trading across border’ in the capital on Tuesday.

Economic Reporters’ Forum (ERF) organized the orientation and awareness program on its premises with the support of the International Finance Corporation (IFC), a member of the World Bank Group, and Bangladesh Customs.

“We will incorporate a provision of imposition of penalty in case of not submitting bill of entry within 72 hours of import,” said customs member (audit, modernization and international trade) Khondaker Muhammad Aminur Rahman at a programe.

High-officials of National Board of Revenue (NBR) shared their recent reform initiatives to simplify trading across borders to improve country’s indicator in the doing business index of the World Bank.

Customs commissioners of Dhaka custom house Md Moazzem Hossain, Kamalpur Inland container depot Md Anwar Hossain, customs bond commissionarate (Dhaka) SM Humayun Kabir, among others, spoke on the occasion.

Private sector specialist of IFC Nusrat Nahid Babi delivered introductory remarks while ERF general secretary SM Rashidul Islam delivered welcome speech.

Customs modernization first secretary AAM Amimul Ehsan Khan gave a detailed presentation on recent initiatives of customs to expedite the trading across the border.

All of the customs commissioners stressed the need for proper coordination between the relevant agencies to improve the process of trading across the border.

Customs member Aminur Rahman said the National Single Window (NSW) would bring 39 agencies under a single roof to ease the process trading across the border.

“Once the NSW project is implemented, the country will see a significant improvement in doing business indicator and it will take one to two days to release goods from ports,” he said.

Accounting – The Language of Business / IFRS 10
« on: February 22, 2020, 11:17:04 PM »
Summary of IFRS 10
The objective of IFRS 10 is to establish principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities. [IFRS 10:1]

The Standard: [IFRS 10:1]

requires a parent entity (an entity that controls one or more other entities) to present consolidated financial statements defines the principle of control, and establishes control as the basis for consolidation set out how to apply the principle of control to identify whether an investor controls an investee and therefore must consolidate the investee sets out the accounting requirements for the preparation of consolidated financial statements defines an investment entity and sets out an exception to consolidating particular subsidiaries of an investment entity*.
* Added by Investment Entities amendments, effective 1 January 2014.


Key definitions
[IFRS 10:Appendix A]

The financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent and its subsidiaries are presented as those of a single economic entity
An investor controls an investee when the investor is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee
An entity that:
obtains funds from one or more investors for the purpose of providing those investor(s) with investment management services commits to its investor(s) that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both, and measures and evaluates the performance of substantially all of its investments on a fair value basis.
An entity that controls one or more entities
Existing rights that give the current ability to direct the relevant activities
Rights designed to protect the interest of the party holding those rights without giving that party power over the entity to which those rights relate
Activities of the investee that significantly affect the investee's returns
* Added by Investment Entities amendments, effective 1 January 2014.


An investor determines whether it is a parent by assessing whether it controls one or more investees. An investor considers all relevant facts and circumstances when assessing whether it controls an investee. An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. [IFRS 10:5-6; IFRS 10:8]

An investor controls an investee if and only if the investor has all of the following elements: [IFRS 10:7]

power over the investee, i.e. the investor has existing rights that give it the ability to direct the relevant activities (the activities that significantly affect the investee's returns) exposure, or rights, to variable returns from its involvement with the investee the ability to use its power over the investee to affect the amount of the investor's returns.
Power arises from rights. Such rights can be straightforward (e.g. through voting rights) or be complex (e.g. embedded in contractual arrangements). An investor that holds only protective rights cannot have power over an investee and so cannot control an investee [IFRS 10:11, IFRS 10:14].

An investor must be exposed, or have rights, to variable returns from its involvement with an investee to control the investee. Such returns must have the potential to vary as a result of the investee's performance and can be positive, negative, or both. [IFRS 10:15]

A parent must not only have power over an investee and exposure or rights to variable returns from its involvement with the investee, a parent must also have the ability to use its power over the investee to affect its returns from its involvement with the investee. [IFRS 10:17].

When assessing whether an investor controls an investee an investor with decision-making rights determines whether it acts as principal or as an agent of other parties. A number of factors are considered in making this assessment. For instance, the remuneration of the decision-maker is considered in determining whether it is an agent. [IFRS 10:B58, IFRS 10:B60]

ACCA (the Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants) have jointly published the Global Economic Themes report. It examines three of the longer-term structural issues that are affecting the global economy as well as the global economic impact of the US-China trade tensions. The three issues are:

·         The Euro – fiscal integration needed

The Euro has survived its first two decades, despite several financial crises that threatened its very existence. But it has not been a success - it has failed to deliver the real economic convergence among its members claimed for it at the outset. Indeed, the Euro’s “one size fits all” monetary policy has delivered economic divergence, not convergence. History suggests that monetary unions only survive in the long run if they become fiscal unions too. The next two decades of the Euro are likely to see further progress in this direction ultimately resulting in a eurozone Finance ministry with tax and spending powers. Limited progress so far has come following financial crises – a prime candidate for the next eurozone crisis is Italy, where public sector debt is very high and the banking system increasingly fragile.

·         China - becoming rich before it becomes old?

Many analysts have predicted that this century will belong to China. Indeed, China has great advantages, including a modern infrastructure, a large domestic market that allows firms to exploit economies of scale and an advanced digital economy. But there are challenges that must be overcome if China is to succeed in propelling itself from a middle-income country to a high income one. High levels of debt, especially among State Owned Enterprises, are now limiting the ability of the authorities to stimulate growth through lower interest rates. In addition, the population of working age is now declining as the population as a whole ages. This will both reduce the trend rate of GDP growth and increase the dependency ratio – fewer workers in relation to an increasing number of older people.

Rehman Sobhan for parliament session to discuss SDG issues

The country lagged behind in three major areas such as climate action, inequality and peace and justice in the long journey of attaining the Sustainable Development Goals (SDGs) by 2030, said Centre for Policy Dialogue on Thursday.

The deficits would dwarf other achievements and make the entire efforts unsustainable, added economists of the think-tank.

They were speaking at a dialogue titled, ‘Delivering SDGs in Bangladesh: Role of Non-State Actors’. The event was organized in association with the Asia Foundation- Bangladesh, Citizen’s Platform for SDGs, Bangladesh and the Swiss Agency for Development and Cooperation (SDC) at a city hotel.

Abul Kalam Azad, Member of Parliament and Chairman of Parliamentary Standing Committee on Ministry of Planning was the chief guest.

CPD Chairperson Professor Rehman Sobhan also spoke on the occasion.

 Rehman Sobhan suggested for holding two dedicated sessions of parliament a year to discuss the issues involving SDGs.

“There should be full session of the parliament on the issue of implementing the SDGs and perhaps it will meet twice in a year,” said the economist.

Prior to the session, parliamentary committee would undertake initiatives for a series of hearings, where they would involve representatives from government and civil society, he added.

If the exercise was done, the parliamentary committee would report to the house in full, he said further. The hearing in the house would generate high level credibility for the state and its commitment to SDGs, noted Rehman.

 “There should be some interactive mechanism, where the government will not only indentify the sustainable development goals, but will also share responsibility with other civil society players,” said Rehman Sobhan.

 Dr René Holenstein, Ambassador of Switzerland in Bangladesh and Ms Mia Seppo, UN Resident Coordinator and Representative, UNDP Bangladesh;  Kazi Faisal Bin Seraj, Country Representative, The Asia Foundation – Bangladesh attended the dialogue, among others.

“Performances in criteria like education and partnership are relatively green, despite questions remain about their qualities. It is notable that we are not performing better in three areas. Firstly in the area of climate action that also involves global responsibility. Secondly, presence of inequality and third is the peace and justice,” said Dr Debapriya Bhattacharya, distinguished fellow at CPD.

  Any country, which suffered from fragile rule of law and inequality and climate action would never be able to sustain other achievements, said Debapriya, also Convener of Citizen’s Platform for SDGs.

In attaining the peace, justice and strong institutions, CPD executive director Dr Fahmida Khatun suggested for upholding rule of law and ensuring access to justice, especially for women, children, poor and marginalized groups.

She also stressed on building local and national capacity for arbitration, mediation and alternative dispute resolution. 

For combating climate challenges, the think-tank also stressed for scaling up adaptation measures to enhance adaptive capacity, strengthen resilience and reduce vulnerability to climate change.

Furthermore, to reduce inequalities the CPD suggested for  keeping a certain portion of seats in private schools reserved for children from under privileged families and providing free education to them.

It also called for improving social protection programmes to minimize leakages and adverse selection.

The think -tank also suggested that non-state actors be included with the process of SDGs implementation and incorporating them with defined responsibility as they could help implement the goals effectively.

“66% resource will be generated from the private sector. But their roles are not clear. Contribution of Non- State Actors (NSA) are closely involved with SDG targets and they are contributing to this,” Mustafizur Rahman, CPD distinguished fellow, said.

On top of that, there was a fund constraint for the NSA, especially at root levels and if the government or the private sector partnership provided fund, it would be very effective to attain SDGS as they could provide data and implement agendas effectively at low cost, said the economist.

BBA Discussion Forum / BB to issue Tk200 notes to mark 'Mujib Borsho
« on: February 22, 2020, 11:03:32 PM »
The central bank will also release commemorative gold and silver coins worth Tk100

Bangladesh Bank is set to launch regular currency notes of Tk200 and commemorative gold and silver coins worth Tk100 on the occasion of birth centenary of Father of the Nation Bangabandhu Sheikh Mujibur Rahman on March 17.

The central bank’s initiative is to mark the historic moment, said a top official of the bank.

“We have taken this initiative as part of commemoration of the birth centenary of Bangabandhu Sheikh Mujibur Rahman,” Sirajul Islam, executive director and spokesman of Bangladesh Bank, told UNB.

He said 1,050 gold coins of Tk100 and 5,000 silver coins of similar value will be released.

Additionally, Tk200 currency notes will also come into the market to mark the occasion. But the number of Tk200 notes to be released is yet to be decided, he added.

He, however, did not give any detail of the new commemorative notes.

At present, there are regular currency notes of Tk1, Tk2, Tk5, Tk10, Tk20, Tk50, Tk100, Tk500 and Tk1000 are available in the market, which were released on different occasions. Their designs were changed several times as well.

Earlier, the Bangladesh Bank also introduced a Tk40 note to commemorate the "40th Victory Anniversary of Bangladesh" in 2011.

The Tk40 commemorative note featured a portrait of the Father of the Nation and the National Martyrs’ Memorial in Savar in the front, and six armed men on the back.

Bangladesh Bank introduced a Tk60 note to commemorate "60 years of National Movement" on February 15, 2012, while it issued a Tk25 note to commemorate the 25th anniversary (silver jubilee) of the Security Printing Corporation (Bangladesh) Ltd on January 26, 2013.

On July 8, 2013, Bangladesh Bank issued a Tk100 note to commemorate the 100th anniversary of the Bangladesh National Museum.

BBA Discussion Forum / The best kind of regulation
« on: February 22, 2020, 11:01:41 PM »
Why a market should regulate itself

We’re told that a certain level of regulation can be -- is -- beneficial to the economy. This is entirely true. The important questions though are not as yet answered by that statement. We need to know who is regulating and how they are doing so.

Take that economists’ model of a “free market.” We can play around with assumptions and outcomes and show that this will be the best of all possible worlds. Or that it won’t be, depending upon how we play with such things. But an important point about the model -- it doesn’t assume no regulation. It, instead, assumes no regulation by those who are not market participants, a very different thing.

That is, we’re assuming away regulators in offices telling people what they may do. We are not assuming that there are no rules, nor that no one enforces the rules. Rather, that those regulations are formed and enforced by those who are making the market exchanges.

Some of these will simply be norms, things enforced purely by habit. When we buy rice or fruit at a market, do we have to take our own bag or do we get one from the stall holder? There’s no particular reason why it should be one way or the other, but there will be that standard process, that norm. It might even differ across places and products but any habitué will know what applies in that place at that time.

Rules will also be more vehemently enforced. The market stall which took your money and refused to provide the goods for it would swiftly be out of business. Partly because no customers would trust it, mostly because other stallholders would quickly drive it out of the area. No one wants to be selling where people will ruin the reputation of producers so badly.

Then there’s regulation simply by consumer preference. It’s entirely feasible to have chilli-flavoured toothpaste and it might even have happened that someone tried to sell it. That it doesn’t generally exist today is because near no one would buy it -- other than at joke shops -- and that means it has been regulated out of existence by that consumer preference.

This is regulation. It’s just that it’s not regulation by bureaucrats, which is how we normally think laws on what may be done are created. As to laws, perhaps that is how they’re created, but as to what happens in markets, we also have those other players. We, depending on how we spend our money, regulate what is on offer.

So, if we, the buyers, regulate what is sold by spending our money on what we desire, and not on what we don’t, when isn’t this enough regulation? There are two slightly different answers to that.

One, which I discuss in a just-published paper, is that sometimes a market transaction affects someone not a part of that transaction. This is called “third party” effects, the usual example being pollution. I sell and you buy freshly grilled meat, and we’re both delighted. But it is the people with the open window above the barbeque who must suffer the smoke.

Because they are not part of the transaction itself, their actions can have no regulatory effect on it -- they won’t influence whether there’s smoke that is. At that point, regulations on smoke emissions outside windows -- or more realistically, in urban areas -- make good sense. Or even a tax upon using charcoal in urban areas. The costs of the pollution are now in the prices paid by the market transactors and thus, those costs are now part of the transaction.

Such third party costs are a valid justification for regulation from outside the market itself. This still leaves what the regulation should be -- a ban, a tax, an insistence upon a particular technology perhaps -- and that will depend upon the details of what is under discussion. There is no hard and fast law for what the rule should be even if we’ve now gained, with these third party costs, a rule as to when there should be some rule.

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