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Earlier, in a meeting at the Post and Telecommunication Division, it was decided that the BTRC’s VAT registration should be completed immediately

The value added tax (VAT) registration of the telecom regulator to collect taxes from mobile phone companies faced yet another hurdle as the revenue authority is not cooperating in this regard, allege BTRC officials.

Bangladesh Telecommunication Regulatory Commission (BRTC) officials say the commission recently put forward an application to the Large Taxpayers’ Unit (LTU) of the National Board of Revenue (NBR) seeking vat registration.

However, it was not accepted by the LTU.

Earlier, in a meeting at the Post and Telecommunication Division, presided over by prime minister’s ICT advisor Sajeeb Wazed Joy, it was decided that the BTRC’s VAT registration should be completed immediately.

Meeting sources say the revenue collection from the operators is facing problem as BTRC is not VAT registered.

‘After the meeting with Sajeeb Wazed Joy, we applied to the Large Taxpayers’ Unit (LTU) of the NBR, but they did not accept our application. We were then asked to come through zonal office. Then we put forward the application to the Dhaka South zone but yet to receive any response so far,’ a senior BTRC official told Dhaka Tribune.

He said although the matter was supposed to be done urgently, but the NBR still seems reluctant.

‘It seems the NBR does not want to give any rebate to the mobile operators as BTRC’s  VAT registration will make the operators eligible for rebate,” he said.

He also says around Tk 150 crore in VAT lies uncollected to all mobile operators from the last quarter.

According to the Value-Added Tax and Supplementary Duty Act 2012, all service suppliers must have VAT registration, which includes the BTRC. The VAT rate is 15%.

The Association of Mobile Telecom Operators of Bangladesh (Amtob), in a statement on last week, said as the BTRC did not have any VAT registration, the operators were not allowed to pay the VAT amount to the telecom regulator.

In 2017-18 fiscal year, the BTRC collected Tk2,501.5 crore from the mobile phone operators in revenue sharing, spectrum charges and licence fees, and Tk2,648.9 crore in the previous fiscal year.

BBA Discussion Forum / One-third of NBFIs in dire straits
« on: February 26, 2020, 09:20:03 AM »

Imprudent lending, regulatory lapses blamed

Financial health of at least one-third of Non-Bank Financial Institutions (NBFIs) is alarming, thanks largely to Bangladesh Bank’s oversight failure, lack of management accountability and regulatory actions.

The regulatory lapses paved the way for imprudent lending by the NBFIs, which are now shouldering a huge accumulation of bad loan coupled with a tendency of becoming defaulters against bank credits and fall in deposit mobilization, it is learnt.

The Bangladesh Bank has appointed 'Observers' at three of the ailing NBFIs — BIFC, First Finance and PLFS — so that their business can turn around while others went scot-free. Either observers were withdrawn from the NBFIs in question, or not reappointed.

The weak financial status of the NBFIs came to forefront following the liquidation move of Peoples' Leasing and Financial Services Limited (PLFS) on July 14. 

PLFS loans and advances stood at Tk1,131crore as of December 31 last year, which was 56 percent of total deposit of Tk2,044.24 crore, according to a recent report of the finance ministry.

The BB found Tk748crore or 66.14% of the loans and advances of PLFS as bad.

Talking to Dhaka Tribune, general manager of Department of Financial Institutions and Market (DFIM) of Bangladesh Bank Md Shahidul Islam rejected the allegation and said, "The central bank has always been watchful on NBFIs."   

He, however, admitted that three NBFIs, which had 'Observers', had none now. 

"Observer at Bangladesh Industrial Finance Company Limited (BIFC) was not reappointed after promotion of the then BB official a couple of years ago. Observer at the First Finance Limited stopped discharging duty because of illness. No one replaced him till date. On the other hand, the function of the observer at PLFS is no longer relevant as Liquidator has been appointed there," Shahidul Islam said.

Ibrahim Khaled, a former deputy governor of BB, thinks the central bank should have been more proactive in protecting the NBFIs.

“The central bank has a scoring mechanism to measure the financial health of the NBFIs like banks. Precautionary measures could have been effective to protect them from becoming sick," he mentions.

NBFIs largely depend on banks for sourcing finance for lending while a small portion of investable funds come from individual depositors. Therefore, imprudent investment involves extensive risks, sources say.

Among the ailing NBFIs are Bangladesh Industrial Finance Company Limited (BIFC) topped the list followed by Peoples' Leasing and Financial Services Limited, FAS Finance & Investment Limited, First Finance Limited, International Leasing and Financial Services Limited (ILFSL), Prime Finance and Investment Limited, Fareast Finance and Investment Limited, Bay Leasing and Investment Limited, Premier Leasing and Finance Limited, Reliance Finance Limited and Union Capital Limited, according to the annual  report of financial institutions (Banks and non-banks) of the Financial Institution Division of Finance.

The report was based on data available up to December 31 last year.

According to the report, BIFC disbursed loans and advances to the tune of Tk841.48 crore, which was 154.2 percent higher than deposits of Tk545.60 crore till 2018. All the loans turned bad.

First Finance's deposit stood at Tk800.06 crore while loans and advances were found 109 percent higher than deposit at Tk879.41 crore while its deposit fell by 4.3 percent, mentions the annual report.

According to the report, the deposit of FAS Finance stood Tk837.50 crore while loans and advances disbursed by the company almost doubled at Tk1535.35 crore. The company's classified loan stood at Tk233.53 crore at the end of 2018, which was 15.2 percent of total investment. FAS Finance obtained loans to the tune of Tk500 crore from banks and, of the amount, Tk77 crore was defaulted. The  company was listed at DSE in 2007. In 2018, its deposit fell by 4.6 percent from what it was the previous year.

The ILFSL's deposit stood Tk2855.77 crore while loans and advances reached Tk3689.67 crore, 129.2 percent higher than deposit during the period. The company was listed at DSE and CSE respectively in 2007. It experienced 1.5 percent fall in deposit over the previous year, 2017.

ILFSL borrowed Tk837 crore from different banks and financial institutions and turned defaulter of loans amounting Tk53 crore.

Deposit at Prime Finance and Investment Limited stood Tk688.50 crore while loans and advances was Tk847.05 crore in 2018; around 123 percent higher than deposit. The company was listed at DSE and CSE respectively in 2005. Its deposit fell in 2018 by 25 % over last year. Prime Finance and Investment Limited had Tk207 crore loans from banks, of which, Tk22 crore was defaulted in 2018.

Bay Leaning’s  deposit stood at Tk774.17 crore while loans and advances were found 131 percent higher at Tk1,016.75 crore. The company was listed at capital market in 2009.

Fareast Finance's deposit stood at Tk557.79 crore and the volume of loans and advances was Tk998.94 crore, which is 179 percent higher than deposit. This company was listed with the capital market in 2013. Its deposit fell in 2018 by 19.3 percent than previous year.

Premier Leasing's deposit stood at Tk893.45 crore and loans and advances was Tk1,282.69 crore, 183 percent higher than deposit. This company's deposit in 2018 fell by 11.8 percent.

In the PLFS's post-liquidation regime, a total of 33 NBFIs are now in operation in the country.

The total investment of the NBFIs together stood at Tk67,000 crore as of June, 2019, said Khalilur Rahman, chairman of Bangladesh Leasing and Finance Companies' Association.

NBFIs bank borrowing was around Tk25,000 crore during the period, he said.

Commenting on NBFIs financial status, Khalilur Rahman said that liquidation of one company would not create any instability in the industry.

Contradicting him, DFIM General Manager Md Shahidul Islam said the liquidation of PLFS created instability to a small extent in the industry.

"It may hurt the economy if any more company's liquidation takes place," he said in response to a question over whether BB had any plan of liquidation of weak BBFIs.

He said NBFIs having sound financial standings were asked to take care of sick ones.

"We will sit with our higher authorities including the Bangladesh Bank governor to find ways to address the ongoing crisis, generating following the PLFS's liquidation move," he added.

The circular said the banks must coordinate with the branches of the central bank outside Dhaka to set up the booths

The Bangladesh Bank on Wednesday asked scheduled banks to set up booths in the cattle markets ahead of Eid-ul-Azha to detect fake or forged notes considering the huge cash transaction.

In a circular, the Bangladesh Bank asked the commercial banks to assign dedicated officers in this regard by August 8.

The circular said the banks must coordinate with the branches of the central bank outside Dhaka to set up the booths.

In absence of any central bank branch, the banks were instructed to conduct the operation through Sonali Bank, the order said.

The central bank also said the banks would have to contact with the local authorities including city corporation, district offices, municipalities and the law enforcing agencies to ensure smooth transaction.

The bank booths must feature the identification marks of the fake notes of taka 100, taka 500, and taka 1000 denominations.

According to BB rules, if any fake notes are found, people circulating such notes should be handed over to police.

However, if the bank finds that the people in question were unaware about such misconduct and presented the note in a good faith, the bank would take detailed information about them and deposit the fake notes to the police, the circular added.

BBA Discussion Forum / Fake handsets not be barred from August 1
« on: February 26, 2020, 09:18:57 AM »
BTRC officials said mobile handset users were advised to buy new handset after checking the authenticity of the set from August 1

The Bangladesh Telecommunication Regulatory Commission on Wednesday backtracked on its earlier decision and said network disconnection of the fake handset would not start on August 1.

BTRC officials said mobile handset users were advised to buy new handset after checking the authenticity of the set from August 1.

‘Confusion was created among the users that we might start disconnecting fake handsets on August 1. But that is not the case. We would do so after the National Equipment Identity Register will come into operation,’ BTRC senior assistant director Zakir Hossain Khan said.

He said the commission would give necessary information to the mobile handset users in appropriate time.

Earlier on Monday, the telecom regulator in a notice said clone mobile phone handset would be barred from network connectivity from August 1.

In the notice the telecom regulator said if any mobile phone handset was found with clone or a wrong IMEI number, a unique number to mark a handset, it would be disconnected through National Equipment Identity Register.

‘Customers are advised to check the authenticity before buying handsets. In the message option of any phone, customers should type KYD<space>15-digit IMEI number and send it to 16002 to get the proper information about the handset.

Also, customers can know IMEI information by dialing *#06#,’ reads the notice.

BTRC officials said the installment of the NEIR under process and might come into operation during the end of the year.

Remittance upto $1,500 will not face questioning

Inward remittances upto $1,500 from same individual in a month would get 2% cash incentives without any questioning while the remitter would need to provide documents relating to source of any amount beyond the ceiling, said Finance Secretary Abdur Rouf Talukder on Monday.

The secretary said the decision came at a meeting held on the day at the finance ministry with Finance Minister AHM Mustafa Kamal in the chair.

"Remittance upto $1,500 will not face questioning. Any amount above the ceiling may require documents relating to its source. Bangladesh Bank (BB) will issue a circular to this effect within a couple of days," said the secretary while briefing reporters at the ministry after the meeting.

The Bangladesh Bank had proposed the ceiling to be set at $1,000 per month.

"We have raised the ceiling to $1,500 aiming to extend maximum facility to the remitters considering that it may bring larger amount of remittance into the country," the secretary said.

The government had announced cash incentives for inward remittance in the budget for FY20.

According to the University Grants Commission (UGC), in 2018 there were 2,190 international students in public and private universities in Bangladesh - 1,386 in private and 804 in public

A government plan to increase the number of foreign students enrolled at public universities may be poised to discouraging foreign enrolment instead.

On December 9, the Ministry of Education issued an order instructing all private and public universities to obtain ministry approval before admitting a student of foreign origin. The order was requested by the Ministry of Foreign Affairs.

Public universities have already had the rule in place. Private university authorities fear that the direct involvement of the state may induce bureaucratic complexities, effectively reduce admission requests from abroad. While the number of foreign students at universities has seen a noticeable uptick since 2012 save for a few hiccups, it still trails behind the private university numbers.

According to the University Grants Commission (UGC), in 2018 there were 2,190 international students in public and private universities in Bangladesh - 1,386 in private and 804 in public.

The government’s case

Currently, private universities recruit students directly through scholarship, Memorandum of Understanding between partner universities and direct applications from foreign students. After getting student visa, the university authority helps renew the student visa every year.

The new admission process will see foreign students submit their application to Bangladesh missions in their home countries. The applications will be forwarded by the Ministry of Foreign Affairs to the Ministry of Education, while the Ministry of Home Affairs carry out security checks.

A total of nine steps of verification by an equal number of agencies will be involved, according to sources familiar with the change.

However, private university authorities have privately expressed their concerns for lengthening the process, instead suggesting a one-stop service and a fixed timeframe for operation. The UGC is also in favour of an easier process, but it has already begun to implement the rule.

Abdullah Al Hasan Chowdhury, an additional secretary at the Ministry of Education said: “It should be clarified how private universities recruit students. The Ministry of Home Affairs has to be in the loop. Foreign applications should come through embassies. We have issued the instruction to homogenize the process for public and private universities alike.”

The UGC also wants an easy way to provide clearance from the ministry of education.

Dr Md Fakhrul Islam, a director (Private University Division) at the UGC, said that the majority of the students arrive in Bangladesh without proper student visa or proper channels.

He said: “There was a time when there were many foreign students at public universities. But that number has dwindled. But private universities have more international students. Our prime minister wants the number of international students in Bangladesh to reach 10,000 by 2020.

“It is difficult to start studying in Bangladesh because documents need to be verified by nine government agencies. Can a student meet all the requisites and begin the semester on time? Unlikely. We suggested a four-step verification, but this is what it is.”

The rebut

According to private university authorities, the approval process is complex and discouraging international students to consider Bangladesh. The new steps are expected to stretch the whole admission process, dampening the rising flow of foreign students, and having and adverse impact on foreign cash flow as well.

Sheikh Kabir Hossain, president of the Association of Private Universities of Bangladesh, said: “Whatever the government is doing is for the well-being of the country. The government should know what kind of people are enrolling in our universities. It will be better if the government consults us.”

Mohammad Imtiaj, director of Branding, Communication and Public Relations at Southeast University, said: “We welcome the move, but the requirement must be clear and the process has to have a fixed timeframe otherwise the students are going to miss their semesters.”

State of foreign students in Bangladeshi universities

Of the 50 public universities in Bangladesh, there are 23 where the 804 international students are enrolled. On the other hand, 37 private universities among 103 have 1,386 international students, according to the UGC.

Dhaka International University has the most, with 285 international students, followed by Daffodil International University with 167 students and North South University with 120.

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

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