Commercial banks have asked the Bangladesh Bank to exempt small and medium enterprise (SME) loans from its new 4 percent cap on interest rate spreads, arguing that these loans cost more to manage than other types of lending.

The request came in a recent letter to the BB governor from the Association of Bankers, Bangladesh (ABB), a forum of bank executives.

The central bank, on June 29, instructed banks to keep the weighted average difference between their lending and deposit rates, known as the intermediation spread, within 4 percentage points for all sectors except credit cards and consumer finance. Banks earn money by charging borrowers more interest than they pay depositors. That overall gap is the spread the central bank is now capping.

The BB said it took the decision to ensure that borrowing costs remain reasonable for businesses and productive sectors. As of May, the weighted average deposit rate across the banking sector was 6.22 percent, and the weighted average lending rate was 11.92 percent -- a spread of 5.70 percent, well above the new cap, according to central bank data.

Banks say SME loans are more expensive to manage than other loans, mainly because handling many small loans takes more staff time and paperwork per taka lent than handling fewer, larger loans. That’s why SME loans already carry higher interest rates than most others: currently around 15 to 16 percent, compared with 13 to 14 percent for most other loans. Credit card rates are higher still, which is part of why BB left credit cards out of the cap entirely.

Bank executives have pushed back on the cap more broadly, not just for SMEs.

They argue that BB’s calculation is based on the interest rate banks are supposed to charge, but doesn’t account for how much of that money banks actually collect. A large share of loans are now in default, or have had their repayment terms rescheduled, meaning banks often earn little or nothing from them.

Bank executives recently raised the issue directly with BB Governor Md Mostaqur Rahman, urging that the regulator base the cap on their actual returns, not the rates on paper.

Contacted, Mashrur Arefin, chairman of the ABB, told The Daily Star that a rigid 4 percent spread cap distorts market-based loan pricing, which should reflect the policy rate, liquidity, inflation, borrower risk and operating costs -- not an administrative ceiling.

“It weakens monetary policy transmission, limits banks’ ability to price risk, discourages efficient banks from expanding, and may reduce credit growth,” he said.

Mashrur, who is also the managing director of City Bank, said the cap could also undermine banks’ financial intermediation role, discourage competition, and ultimately slow investment, employment and economic growth. “A more effective way to lower borrowing costs is through lower inflation, lower policy rates and stronger competition.”

He said the effect would hit SMEs hardest, since SME lending already involves higher administrative costs, more risk of default, and more monitoring than lending to large corporations.

A flat 4 percent spread cap makes many SME loans commercially unviable, prompting banks to shift toward lower-risk corporate borrowers, the ABB chairman said, adding that this would restrict formal financing for small businesses, weaken entrepreneurship and job creation, and push many SMEs toward costlier informal lenders -- the opposite of the policy’s intended objective.

The difficulty is already familiar to small business owners. Taslima Miji, an SME entrepreneur, said high interest rates are a major obstacle to her business.

“It is very difficult to run a business by borrowing at such high interest rates. Therefore, lending rates should be reduced. However, we often cannot even obtain loans because of the numerous conditions and stringent requirements imposed by banks,” she said.

In FY25, banks disbursed Tk 2,05,493 crore in SME loans, down by nearly 9 percent from FY24, BB data showed.

Officials of the central bank said overall private sector credit growth is currently low, which is why SME loan disbursement did not pick up.

Besides regular SME loan disbursement, the cottage, micro, small and medium enterprise (CMSME) sector will receive Tk 5,000 crore in low-interest loans under the BB-announced stimulus package to revive the country’s struggling private sector.

Samsung has resumed manufacturing operations in Bangladesh after a hiatus of about 18 months, with locally produced smartphones expected to return to the market in January next year.

The restart signals a renewed push in Bangladesh's electronics manufacturing sector, where Samsung was the first global smartphone brand to assemble handsets locally through Fair Electronics.

Production of Samsung refrigerators has already begun at the company's factory in Shibpur, Narsingdi, while washing machine production is scheduled to start in September. Air conditioners, televisions and smartphones are expected to enter production in early 2027.

Bangladesh's large and hard-working workforce, combined with Korean technology and investment, gives the country the potential to become a regional manufacturing hub for Korean companies.
Jijoon Kim | South Korean ambassador to Bangladesh

The South Korean ambassador to Bangladesh, Jijoon Kim, announced the development during his visit to the factory today (22 july). During a visit by South Korean Ambassador Jijoon Kim to the factory today. Samsung Bangladesh Managing Director Jungmin Jung and Fair Group Chairman Ruhul Alam Al Mahbub accompanied him during the tour.

According to Fair Group, it became Samsung's official distribution partner in Bangladesh in 2014, established a local manufacturing facility in 2017 and launched the country's first locally manufactured Samsung smartphones in 2018.

The group has invested around Tk1,000 crore in electronics manufacturing, including about Tk300 crore in smartphone production. The facility has an annual production capacity of around 2.5 million mobile phones.

Fair Group is currently manufacturing products under China's Hisense brand while restarting Samsung production. The company plans to produce around 150,000 refrigerators annually under the two brands by 2027. At present, it manufactures between 40,000 and 50,000 Hisense refrigerators a year.

A visit to the factory showed refrigerators being assembled through automated production lines, with processes ranging from metal body fabrication and component assembly to foam insulation, compressor installation and final quality testing.

Mohammed Mesbah Uddin, chief marketing officer of Fair Group, told TBS that Samsung smartphone production remained suspended from mid-2024 through the end of 2025 as the business environment became challenging following the sharp depreciation of the taka in 2023.

"Effectively, it became very difficult to continue business operations during that period," he said.

He said Fair Group had planned to revamp its operations in 2025, but the process He stated that Fair Group had intended to revamp its operations in 2025, but the process fell short of expectations. as expected. With conditions improving this year, the company has restarted production.

Mesbah said the transition of the market from 4G to 5G devices also required technological upgrades and new machinery, contributing to delays in restarting smartphone production.

While the factory is capable of producing 2.5 million handsets annually, he said the company does not expect to utilise its full capacity in the first year after resuming operations.

Speaking to journalists after touring the facility, Ambassador Kim described Fair Electronics as a successful example of technology transfer, local manufacturing and industrial cooperation between Bangladesh and South Korea.

He said Bangladesh's large and hard-working workforce, combined with Korean technology and investment, gives the country the potential to become a regional manufacturing hub for Korean companies.

Fair Group Chairman Ruhul Alam Al Mahbub urged the government to take stronger action against grey-market and unofficial mobile phone imports, saying a supportive policy environment would accelerate local manufacturing, attract investment, increase government revenue and create jobs.

Samsung Bangladesh Managing Director Jungmin Jung reaffirmed the company's long-term commitment to Bangladesh and its partnership with Fair Electronics in expanding local manufacturing while maintaining Samsung's global quality standards.

The country's worsening gas crisis is putting crores of taka in industrial investment at risk, delaying new projects, disrupting factory operations and increasing financial risks for banks, business leaders, energy experts and policymakers warned yesterday (22 July).

Speaking at the "Energy Security and Transformation of Bangladesh" policy conclave organised by the daily Bonik Barta in Dhaka, participants said prolonged gas shortages have become one of the biggest barriers to investment, while highlighting the need for infrastructure expansion, a diversified energy mix, and greater private sector participation.

They further called for urgent reforms to boost domestic gas production and strengthen long-term energy security.

Trust Bank Managing Director Ahsan Zaman Chowdhury said the gas shortage has left around Tk7,000-8,000 crore in the bank's industrial financing stranded, warning that the crisis could eventually spill over into the banking sector.

"When banks approve industrial loans, the projects already have gas connection approvals from Titas. Entrepreneurs invest their own money, provide guarantees and install machinery, but the projects cannot begin operations because gas is unavailable," he said.

According to him, expensive imported machinery has remained idle for three to four years in many cases, causing national economic losses as equipment gradually deteriorates.

If the projects eventually become loan defaults, the banking sector will also come under severe pressure, he added.

Echoing similar concerns, Meghna Group of Industries Chairman Mostafa Kamal said the gas crisis, combined with administrative bottlenecks, is discouraging new investment and threatening existing industries.

Although the government speaks of improving the ease of doing business, entrepreneurs continue to struggle to secure gas connections, regulatory approvals and infrastructure support, while also having to meet the conditions of foreign lenders, he said.

The MGI chairman noted that the Bangladesh Economic Zones Authority had promised to provide gas, electricity and water to the company's economic zones. Relying on those commitments, the company continued to attract investors, with 15 companies from the US, Europe and China investing there and creating around 12,000 jobs.

However, delayed gas connections have stalled project implementation despite nearly $600 million in financing from the International Finance Corporation (IFC), the World Bank and other international lenders, Mostafa said, adding that unlike domestic banks, foreign lenders offer little flexibility in extending project deadlines, exposing investors to substantial financial risks.

The industrialist, whose group operates 57 factories employing around 65,000 people, warned that prolonged delays in one major project could undermine the viability of several others.

East Coast Group Chairman Azam J Chowdhury said policy unpredictability remains one of the biggest deterrents to investment. While the government talks about "zero duty", procedures at the NBR and Customs remain complicated, he said.

Transcom Group CEO Simeen Rahman said for modern manufacturing, the challenge is no longer just energy availability, but energy reliability and power quality.

"Gas shortages, voltage fluctuations and unplanned interruptions do more than just stop production – they create a wave of uncertainty that destabilises our entire supply chain and inflates operating costs," she said.

Energy expert M Tamim said Bangladesh should pursue a diversified energy mix rather than aim for complete energy independence.

"There is absolutely no chance of becoming fully energy-independent. Our primary goal must be to use renewable energy to reduce our crushing reliance on imports, not to dream of total self-sufficiency," he said, urging greater regional electricity trade and stronger government support for large-scale solar projects.

Former Power Grid Bangladesh chairman M Rezwan Khan, meanwhile, proposed a three-tier electricity tariff structure covering peak, off-peak and super off-peak hours.

"If we raise peak-hour prices but lower them during off-peak times, the average cost remains the same for the government, but it creates a massive incentive for businesses and apartments to replace diesel generators with battery storage," he said.

No new industrial gas connections

Titas Gas Transmission and Distribution PLC Managing Director Shahnewaz Parvez said the company cannot provide new industrial gas connections unless domestic gas production increases or overall supply improves.

More than 500 customers have already deposited money for gas connections after receiving demand notes but remain unable to obtain supplies because of inadequate supply, he said.

Titas distributes about 60% of the country's natural gas and requires around 2,200 million cubic feet per day (mmcfd) to meet demand.

According to Shahnewaz, although at least 1,700 mmcfd is needed to maintain relatively normal operations, Titas is currently receiving only 1,500-1,550 mmcfd.

The situation has worsened after one floating LNG terminal recently went offline, intensifying shortages, particularly in Gazipur's industrial belt, he added.

Neglect in gas exploration

Power, Energy and Mineral Resources Minister Iqbal Hasan Mahmood Tuku attributed the crisis to years of neglect in domestic gas exploration. "About 28,000MW of generation capacity has been built, but no effective initiative was taken to increase domestic gas production. Not a single gas well was drilled over the past 17 years."

He also noted that Bangladesh depends on only two floating LNG terminals, leaving the gas supply system vulnerable whenever one terminal becomes inoperable.

Meanwhile, speaking about the country's power distribution system, the minister said the government wants to privatise power distribution to improve efficiency, accountability and bill collection.

He invited the private sector to submit proposals to take over the country's electricity distribution companies, adding that the prime minister has given consent to move ahead with the initiative.

He also said the government is considering allowing private companies to import petroleum products to encourage competition and reduce the state's role in the sector.

World Bank Country Director for Bangladesh and Bhutan Jean Pesme said Bangladesh's growing reliance on imported fuel and the widening gap between energy supply costs and consumer tariffs are increasing fiscal pressure.

He said around 30% of gas demand, 95% of oil and 90% of coal consumption now depend on imports, exposing the economy to global price volatility and supply disruptions.

According to the World Bank, energy subsidies now account for about 1.1% of GDP, underscoring the need for gradual tariff reforms, expansion of renewable energy, regional power trade and greater private investment in the gas value chain.

Omera Renewable Energy CEO Masudur Rahim said policy inconsistencies were also slowing investment in renewable energy. "Although the government announced zero-duty benefits for solar equipment, importers are not receiving those incentives due to conflicting tax conditions, discouraging rooftop solar expansion despite its significant potential."

Bangladesh Jewellers Association (Bajus) has raised the prices of gold for the second consecutive day, pushing the rate of 22-carat gold up by Tk 2,741 per bhori to Tk 2,24,182, inclusive of VAT.

In a notice issued today (22 July), Bajus said the revision followed a rise in the price of pure gold in the local market, prompting the fresh adjustment. The new rate came into effect from 10am today (22 July).

Under the revised pricing, each bhori (11.664 grams) of 21-carat gold will now cost Tk 2,14,093, while 18-carat gold has been set at Tk 1,83,883 per bhori. Traditional gold will sell at Tk 1,50,232 per bhori, the notice said.

Bajus said the new prices will remain effective at all jewellery outlets until further notice, though making charges will continue to apply depending on ornament design.

Since VAT is already included in the selling price of gold and silver ornaments, jewellers cannot charge it separately from customers.

The association added that its existing rules on exchange and repurchase of ornaments, excluding specified VAT, making charges and stone costs, will remain unchanged.

The previous adjustment came on the morning of July 21, when Bajus raised the price of 22-carat gold by Tk 1,633 per bhori to Tk 2,21,441, inclusive of VAT.

So far in 2026, the price of gold has been revised 93 times in the domestic market, increased on 45 occasions, decreased on 47, and adjusted once for VAT.

Alongside gold, the price of silver was also raised.

The rate of 22-carat silver went up by Tk 175 per bhori to Tk 4,782. Similarly, 21-carat silver is now selling at Tk 4,549 per bhori, 18-carat at Tk 3,907, and traditional silver at Tk 2,974 per bhori.

Silver prices have been adjusted 57 times so far this year, with 29 increases and 28 decreases.

The Cabinet Committee on Government Purchase (CCGP) on Wednesday approved two procurement proposals worth about Tk 303.16 crore involving the import of muriate of potash (MOP) fertiliser and the purchase of sacks for the Directorate General of Food.

The approval came at a meeting held at the Secretariat with Finance Minister Amir Khosru Mahmud Chowdhury in the chair.

The committee recommended approving a proposal from the Ministry of Agriculture to import 40,000 (±10%) tonnes of MOP fertiliser under the 12th (second optional) lot of a state-level agreement between the Canadian Commercial Corporation (CCC) and the Bangladesh Agricultural Development Corporation (BADC).

The fertiliser will be imported at a total cost of Tk 192.10 crore, with the price fixed at US$388.55 per tonne.

The committee also recommended approving a proposal from the Ministry of Food for the procurement of 1.6 crore sacks, each with a capacity of 30 kg, through 80 packages under the electronic government procurement (e-GP) system for the Directorate General of Food.

The procurement will cost Tk 111.06 crore, with contracts to be awarded to 21 bidders selected across the 80 packages.

A technical glitch at one of the country’s floating LNG terminals has cut gas supply to the national grid by around 450 million cubic feet per day (mmcfd), or nearly 17 percent, worsening an already acute supply crunch across the country.

According to Petrobangla data, total gas supply was around 2,620 mmcfd against demand of nearly 3,800 mmcfd before the problem was detected on Tuesday.

Following the shutdown of the affected floating storage and regasification unit (FSRU), supply has dropped to 2,170 mmcfd.

The disruption has affected industries, power plants, and CNG (compressed natural gas) filling stations in different parts of the country.

In some areas, including Dhaka and its surrounding areas, lower gas pressure has prevented CNG stations from receiving adequate supplies, resulting in long queues and public suffering.

The government said relevant agencies and technical experts were working to fix the FSRU problem. However, it did not say when the terminal would return to normal operations.

At a briefing at the Secretariat yesterday, Monir Hossain Chowdhury, a joint secretary of the Energy Division, said the immediate gas supply disruption was linked to the FSRU malfunction rather than the Middle East conflict.

He said there was no crisis in fuel supply and accused some people of spreading “fake news” in this regard.

The country currently has around 344,000 tonnes of diesel in stock, while another 180,000 tonnes are expected to arrive by July 31, he said.

The stock is enough to meet national demand for about 48 days, he added.

Moreover, another 240,000 tonnes of diesel are scheduled to arrive in August, the joint secretary said.

Bangladesh’s dependence on the Middle East for fuel imports is limited, with crude oil being the main area of reliance.

“We used to bring fuel through the Red Sea, but we have found alternative routes,” he said, adding that there was no immediate risk of a fuel supply crisis.FSRU glitch cuts gas supply by 17%

Star Business Report

A technical glitch at one of the country’s floating LNG terminals has cut gas supply to the national grid by around 450 million cubic feet per day (mmcfd), or nearly 17 percent, worsening an already acute supply crunch across the country.

According to Petrobangla data, total gas supply was around 2,620 mmcfd against demand of nearly 3,800 mmcfd before the problem was detected on Tuesday.

Following the shutdown of the affected floating storage and regasification unit (FSRU), supply has dropped to 2,170 mmcfd.

The disruption has affected industries, power plants, and CNG (compressed natural gas) filling stations in different parts of the country.

In some areas, including Dhaka and its surrounding areas, lower gas pressure has prevented CNG stations from receiving adequate supplies, resulting in long queues and public suffering.

The government said relevant agencies and technical experts were working to fix the FSRU problem. However, it did not say when the terminal would return to normal operations.

At a briefing at the Secretariat yesterday, Monir Hossain Chowdhury, a joint secretary of the Energy Division, said the immediate gas supply disruption was linked to the FSRU malfunction rather than the Middle East conflict.

He said there was no crisis in fuel supply and accused some people of spreading “fake news” in this regard.

The country currently has around 344,000 tonnes of diesel in stock, while another 180,000 tonnes are expected to arrive by July 31, he said.

The stock is enough to meet national demand for about 48 days, he added.

Moreover, another 240,000 tonnes of diesel are scheduled to arrive in August, the joint secretary said.

Bangladesh’s dependence on the Middle East for fuel imports is limited, with crude oil being the main area of reliance.

“We used to bring fuel through the Red Sea, but we have found alternative routes,” he said, adding that there was no immediate risk of a fuel supply crisis.

At a meeting on alternative financing chaired by Finance Minister Amir Khosru Mahmud Chowdhury on June 20, the Bangladesh Bank governor proposed that the country’s first international sovereign bond should be a $50 million panda bond in China’s onshore market. An inter-ministerial committee will weigh it against a conventional dollar Eurobond.

The obvious objection is arithmetic. Against a Tk 9.38 lakh crore budget and external repayments heading towards $6 billion a year, $50 million would fund the government for only a matter of hours. But raising money is the wrong test for a debut. I argued last month that Bangladesh’s problem is not solvency but the absence of any market channel once the concessional cushion thins. The question is not how much to borrow, but what a first transaction is designed to achieve.

A well-designed debut produces things that money cannot buy later. The first is a price: a market rate for Bangladeshi sovereign risk, set by investors rather than inferred from a rating letter. The second is an apparatus: the disclosure and reporting machinery that a bond requires. None of this exists today. A debut is also a rehearsal: the ministry’s first order book and first pricing call, at a size where a mistake becomes a lesson rather than a crisis.

Pakistan has just shown what this looks like. In May, it became the first South Asian sovereign to issue a panda bond: about $258 million, priced with a 2.5 percent coupon and more than five times oversubscribed, more than five percentage points below the average on its outstanding dollar bonds. The difference was structure, not creditworthiness. Partial guarantees from the Asian Development Bank and the Asian Infrastructure Investment Bank lifted the instrument to a domestic AAA rating. Having worked on the privatisation of Pakistan’s state oil and gas companies a decade ago, I recognise the pattern. Its access to international capital has always depended on structure. Indonesia is pricing its own debut this week at around $1 billion, but it is investment grade and needs no guarantee. Bangladesh, rated B+ with a negative outlook, appears to investors much like Pakistan, and the same template applies: a small, credit-enhanced issue with proceeds ring-fenced for a named project.

The standard warning against sovereign bonds invokes Sri Lanka and Argentina. What undermined those borrowers was scale and purpose: billions raised at market rates to plug fiscal deficits, unhedged. A $50 million guaranteed instrument is a controlled experiment that makes failure less likely because the alternative is a debut done in a hurry, at scale, when repayments force the government’s hand.

The caveats should be on the record. A yuan bond will be seen by some as a tilt towards Beijing. A small instrument guaranteed by multilateral banks is a market transaction, not a political alignment, and the dollar Eurobond should remain under consideration in parallel. Yuan debt also creates a currency mismatch because Bangladesh earns dollars, not renminbi. A swap line or hedging against Chinese imports should therefore be built in from the start. And this would genuinely be a first. The Bangla Bond listed in London in 2019 was issued by IFC on its own balance sheet, and the sovereign’s signature has never been tested in international markets.

The committee’s terms of reference should define success in terms of capability rather than proceeds: engage the rating agencies before any mandate is awarded, and negotiate a partial guarantee with the ADB or AIIB based on the Pakistani model. A published debt strategy should identify a benchmark transaction and set a date. The governor’s $50 million figure is right, for better reasons than caution. The first bond is not the financing. It is the door.

Textile millers yesterday urged the government to introduce a special refinancing scheme for existing loans to export-oriented primary textile industries with a maximum interest rate of 5 percent.

The millers made the demand during a meeting with Prime Minister Tarique Rahman at his secretariat office in Dhaka. Bangladesh Textile Mills Association (BTMA) President Showkat Aziz Russell led the delegation.

They also urged the government to quickly implement the announced Tk 20,000 crore working capital support package through simplified procedures, project-based Credit Information Bureau (CIB) assessments, and temporary relaxation of CIB requirements for closed or partially operational industrial enterprises.

The manufacturers made the demand during a meeting with Prime Minister Tarique Rahman at his secretariat office
They also sought the adoption of a competitive policy framework through a coordinated tariff and tax structure, financial support measures, and export promotion policies for the primary textile and export-oriented readymade (RMG) industries in line with those of competing countries.

They also urged the Prime Minister’s Office to ensure the prompt and efficient delivery of government services to export-oriented industries.

In response, the prime minister directed the formation of a high-level committee comprising the commerce minister, the prime minister’s adviser on finance and planning, and the Bangladesh Bank governor, according to a BTMA statement.

The committee will convene its first meeting within one week to review the existing challenges facing the primary textile sector and submit its recommendations.

At the meeting, the BTMA handed over a Tk 5 crore cheque to the prime minister’s relief and welfare fund.

Meanwhile, a delegation of the board of directors of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), led by its president, Mahmud Hasan Khan, met with the prime minister yesterday.

The BGMEA leaders demanded an uninterrupted supply of gas and electricity to keep factories operational and ensure the timely shipment of export orders.

The delegation highlighted the adverse impact of the recent energy crisis on production and the increased operating costs incurred by factories due to their reliance on alternative power sources.

BGMEA also strongly requested the establishment of a dedicated mechanism under the Prime Minister’s Office to facilitate the prompt resolution of issues relating to customs, banking, gas, electricity, and other government services for export-oriented industries, according to a BGMEA statement.

The association also proposed that the prime minister introduce a permanent policy under which annual customs bond audits would be conducted by leading professional audit firms to eliminate the complexities associated with frequent audits by the National Board of Revenue and bond authorities.

In view of the inadequate cargo handling capacity at Hazrat Shahjalal International Airport, which has led to increased lead times, BGMEA requested urgent measures to construct a temporary cargo shed.

The leading trade body also requested the allocation of suitable government land in Gazipur, the country’s largest apparel manufacturing hub, to establish a modern specialised hospital for garment workers, ensuring affordable, quality healthcare services for millions of workers.

Power distribution and petroleum import are set to be privatised under sweeping reforms in Bangladesh's hard-up energy sector as the new government aims to cut subsidies and bring efficiency in the vital field.

Officials say the revamping plan comes as the sector has suffered from years of weak planning and growing dependence on imported fuels.

Power, Energy and Mineral Resources Minister Iqbal Hasan Mahmood disclosed the plans while addressing a policy conclave titled 'Energy Security & Transformation of Bangladesh' organised by Bonik Barta at the Pan Pacific Sonargaon in Dhaka on Wednesday.

The minister said the government received the prime minister's approval in principle to move ahead privatising electricity-distribution companies.

"I want to privatise all our distribution companies," he said. "The government can generate electricity and sell it in bulk, but retail distribution should be handled by the private sector."

He invited local entrepreneurs to submit proposals, saying that private operators would improve accountability, strengthen bill collection and reduce government's financial burden. Referring to India, he said electricity distribution in cities like Kolkata, Mumbai and Delhi was successfully managed by private companies, adding that Bangladeshi firms should also be capable of performing the same role.

Mahmood also said the government was considering allowing private companies to import petroleum products to encourage competition and reduce the state's role in fuel import.

The minister has described Bangladesh's energy sector as one that has been left without an effective long-term strategy over the past 17 years. While power-generation capacity had expanded to around 28,000 megawatts, he said, domestic fuel supplies had failed to keep pace.

"Not a single gas well has been drilled in the country over the past 17 years," he told the meet, adding that Bangladesh had become increasingly dependent on fuel imports.

He mentioned that three gas-fired power plants in the Khulna region remained idle because gas supply had not been secured, while construction of a pipeline from Bhola was continuing.

Referring to the recent disruption to one of the country's two floating LNG-import terminals, Mahmood said gas pressure had fallen across several regions, disrupting household supplies and compressed natural gas stations and triggering protests.

He stresses that Bangladesh must simultaneously increase domestic gas exploration and strengthen LNG-import infrastructure to ensure long-term energy security.

The minister said the government was trying to create greater opportunities for private investment across the energy sector.

He also announced plans to install 10,000 megawatts of solar power during the current government's tenure through utility-scale projects and cluster-based rooftop solar systems operated by private investors under net-metering arrangements.

Building owners installing rooftop solar facility would receive municipal tax rebates, while those unwilling to adopt solar power could face additional taxes.

Land has already been identified for large-scale solar projects, with tenders expected in August or September, he added.

State Minister for Planning Md Zonayed Abdur Rahim Saki attended the conclave as special guest.

Bangladesh Energy Regulatory Commission Chairman Jalal Ahmed warned that Bangladesh's domestic energy resources were steadily depleting.

He said domestic gas production had fallen from around 2,600-2,700 million cubic feet per day in 2016-17 to about 1,700 million cubic feet per day, while uncertainty remained over the country's remaining reserves.

Jalal Ahmed notes that Myanmar recently discovered an estimated 100 trillion cubic feet of offshore gas and India about 29 trillion cubic feet off Andhra Pradesh, whereas Bangladesh had not conducted offshore exploration in the Bay of Bengal for 17 years.

"Even if surveys began immediately," he said, "it would still take at least five years before any commercial discoveries could be confirmed."

During a panel discussion, East Coast Group Chairman Azam J. Chowdhury criticised a lack of transparency in policymaking, particularly changes to tax incentives for the solar sector.

He said investors required a predictable regulatory framework and argued that once businesses committed substantial capital, the government had a moral responsibility to ensure energy connections. Frequent supply disruptions, he added, were affecting industrial production and the wider supply chain.

World Bank Country Director for Bangladesh and Bhutan Jean Pesme described energy as a key driver of private investment, economic growth, employment, competitiveness and fiscal sustainability.

While acknowledging Bangladesh's achievements in expanding electricity access, he said the sector remained vulnerable because of its dependence on imported fuels and the persistent gap between supply costs and consumer tariffs.

According to Pesme, imports now account for around 30 per cent of Bangladesh's gas demand, 95 per cent of fuel-oil demand and 90 per cent of coal demand, exposing the economy to global price volatility and supply disruptions.

He added that declining domestic gas production and expensive power-generation contracts were placing increasing pressure on public finances.

Simeen Rahman, Chief Executive Officer of Transcom Group and Vice-President of the Metropolitan Chamber of Commerce and Industry, said industries required not only adequate electricity but also reliable and high-quality power supplies.

She said voltage fluctuations, outages and unreliable electricity disrupted production, increased operating costs and weakened competitiveness. Rising energy prices also pushed up the costs of running generators, transporting raw materials and distributing finished products, while many companies were unable to pass those additional costs on to consumers because of intense international competition.

Trust Bank Managing Director Ahsan Zaman Chowdhury said commercial banks became heavily exposed to industrial projects affected by gas shortages.

He said Trust Bank alone had between Tk 70 billion and Tk 80 billion invested in projects whose operations had been delayed because of inadequate gas supplies.

A United Arab Emirates-based investment company has expressed interest in investing more than $2.0 billion in Bangladesh's priority sectors, signalling renewed foreign investor interest in the country's infrastructure and capital market.

Abu Dhabi-based Equiline Finance signed a memorandum of understanding (MoU) with Prime Bank Investment on Monday to jointly explore investment opportunities and develop bankable projects across key sectors, according to a statement.

The proposed investment pipeline covers government-backed projects in energy, transport, healthcare, ports and logistics, agriculture and agro-processing, waste and water management, tourism, digital infrastructure and other priority sectors.

Market operators said the partnership comes at a time when Bangladesh is actively seeking to diversify sources of foreign investment amid pressure on external financing and rising demand for long-term capital to support infrastructure development.

Under the agreement, Prime Bank Investment, a wholly owned subsidiary of Prime Bank PLC, will act as Equiline Finance's local investment banking partner by identifying investment opportunities, conducting bankability assessments, structuring transactions and facilitating capital market financing and regulatory processes.

The collaboration is expected to create a structured platform for mobilising institutional foreign capital into Bangladesh's infrastructure and capital market while strengthening investment ties between Bangladesh and the United Arab Emirates.

"Bangladesh continues to attract serious international capital for infrastructure, energy transition and sustainable development," said Syed M Omar Tayub, Managing Director and Chief Executive Officer of Prime Bank Investment.

He said the partnership would combine Equiline Finance's global financing capability with Prime Bank Investment's domestic market expertise to transform investment interest into well-structured, bankable projects capable of attracting long-term capital.

Equiline Finance Chief Executive Officer Salah Al Nasser said Bangladesh offers strong economic fundamentals and a clear development agenda, making it an attractive destination for sustainable investments.

"Partnering with Prime Bank Investment strengthens our local interface for project origination, structuring and market execution as we explore high-impact investments across priority sectors," he said, adding that the partnership would help establish a durable platform for sustainable and structured finance in Bangladesh.

Prime Bank Investment has over 16 years of experience in Bangladesh's investment banking industry, providing debt and equity capital market services, corporate advisory, portfolio management and trustee services.

Equiline Finance specialises in structured project finance, export finance, sustainable and impact investments, capital structuring, risk management, mergers and acquisitions, and institutional advisory.

If the proposed investment programme materialises, it could become one of the largest recent foreign investment initiatives in Bangladesh, providing a major boost to infrastructure financing, expanding foreign participation in the capital market and deepening the country's economic ties with Gulf investors, market insiders say.

Bangladesh Bank (BB) today (Wednesday) issued a circular easing foreign exchange transactions for freelancers and individual service exporters, in a move aimed at further supporting the country’s growing digital services sector.

The new guidelines allow freelancers to receive payments based on electronic evidence—such as platform statements, emails, and other digital communications—removing reliance on conventional export documentation and making the process more adaptable to digital trade, BSS reports citing a press release.

To facilitate small-value transactions, inward remittances up to US$ 20,000 can be credited without formal declaration requirements. Payments through Online Payment Gateway Service Providers (OPGSPs) are permitted up to $10,000 per transaction, with provisions ensuring timely repatriation of funds to Bangladesh.

The circular also enables issuance of dual-currency freelancer cards and expands the use of Mobile Financial Service Providers (MFSPs) and Payment Service Providers (PSPs), thereby widening access to convenient and efficient digital payment channels.

In addition, freelancers in ICT sectors may retain up to 50% of their export earnings in foreign currency accounts, commonly known as Exporters’ Retention Quota (ERQ), while other service exporters may retain up to 30%, providing greater flexibility in managing international business expenses.

Market participants view the move as a timely and forward-looking step, aligning the regulatory framework with the evolving nature of digital trade and freelance work.

By simplifying procedures and expanding access to formal payment channels, the circular is expected to encourage greater formalization of service export earnings, improve transparency, and strengthen foreign exchange inflows.

As per business insiders, the initiative is expected to enhance ease of doing business for freelancers, promote formal remittance channels, and further integrate Bangladesh’s service exporters into the global digital economy, while also supporting the country’s broader ambition of building a robust knowledge-based and digitally driven export ecosystem.

Bangladesh Foreign Minister Dr Khalilur Rahman met his counterparts from China, Russia, and the US on the margins of the ASEAN Regional Forum Foreign Ministers' Meeting on Wednesday in the Philippine capital, Manila.

These meetings covered a broad spectrum of bilateral relations, including trade, investment, energy and connectivity, as well as regional and international issues. During these meetings, the Bangladesh side underlined that the ‘Bangladesh First’ policy will guide Bangladesh’s external relations, a spokesman for the foreign ministry said on Wednesday.

The adviser to the prime minister for foreign affairs, Mr. Humaiun Kobir, is accompanying the foreign minister.

At the bilateral meeting with Chinese Foreign Minister Wang Yi, both sides resolved to advance a comprehensive cooperative partnership to jointly build a China-Bangladesh Community for a shared future. The two foreign ministers discussed further cooperation in regard to the repatriation of forcibly displaced Myanmar nationals, multi-modal transport corridors, trade and investment, and energy cooperation.

During the Bangladesh-Russia bilateral meeting, the Russian Foreign Minister Sergey Lavrov congratulated the Foreign Minister of Bangladesh on his election as the President of the 81st UN General Assembly. Both sides agreed to enhance cooperation in the energy sector.

Later in the afternoon, US Secretary of State Marco Rubio received the Bangladeshi foreign minister and discussed further strengthening US-Bangladesh ties. Foreign Minister Rahman invited Secretary Rubio to visit Bangladesh.

The Bangladesh foreign minister is leading the Bangladesh delegation to the 33rd ASEAN Regional Forum Foreign Ministers meeting and the 50th anniversary of the Treaty of Amity and Cooperation of Southeast Asia.

The Executive Committee of the National Economic Council (ECNEC) on Wednesday approved eight development projects involving an estimated cost of Tk 14,411.21 crore.

Of the total project cost, Tk 10,494.21 crore will come from the government's own funds, while Tk 3,550.44 crore will be financed through project loans.

The approvals came at an ECNEC meeting held at the Cabinet Division in the Bangladesh Secretariat, chaired by Prime Minister and ECNEC Chairperson Tarique Rahman.

Of the eight projects, three are new and five are revised.

The meeting was attended by Finance and Planning Minister Amir Khasru Mahmud Chowdhury, Local Government, Rural Development and Cooperatives Minister Mirza Fakhrul Islam Alamgir, Industries, Textiles and Jute and Commerce Minister Khandaker Abdul Muktadir, Law, Justice and Parliamentary Affairs Minister Md. Asaduzzaman, Home Affairs Minister Salahuddin Ahmed, Disaster Management and Relief Minister Asadul Habib Dulu, Power, Energy and Mineral Resources Minister Iqbal Hasan Mahmud, Water Resources Minister Md. Shahiduddin Chowdhury Annie, State Minister for Local Government, Rural Development and Cooperatives Mir Shahe Alam, State Minister for Planning Md. Jonayed Abdur Rahim Saki, and senior government officials.

Among the approved projects, three belong to the Local Government Division: the General Social Infrastructure Development-2 (GSIDP-2) (First Revised) project, the Greater Dinajpur (Dinajpur, Thakurgaon and Panchagarh) Integrated Development Project, and the Rural Road Maintenance and Employment Project.

Other approved schemes include the Disaster Shelter Construction, Renovation and Development Project (Third Revised) under the Ministry of Disaster Management and Relief; the Dhaka-Ashulia Elevated Expressway Construction Project (Second Revised) under the Road Transport and Bridges Ministry; the Power Distribution System Development Project, Sylhet Division (Third Revised) and the Drilling of one appraisal-cum-development well (Begumganj-5) and two exploration wells (Begumganj-6 and Sunetra-2) under the Power, Energy and Mineral Resources Ministry; and the Kidney Dialysis Centre Expansion Project (Second Revised) under the Health and Family Welfare Ministry.

The ECNEC meeting was also informed that Planning Minister Md. Jonayed Abdur Rahim Saki had approved 11 development projects, each costing less than Tk 50 crore, under delegated authority. The projects include regional offices for the National University, transport infrastructure, electricity transmission facilities, airport mobile network installation and vocational education institutes.

The government is preparing an ambitious five-year trade and investment strategy to support a smooth transition from least developed country (LDC) status, targeting a 75% rise in per capita income to $5,000 by 2031 through higher investment, stronger export competitiveness, and wide-ranging regulatory reforms.

It also hopes to make significant progress in reducing economic vulnerability while improving human assets and social development indicators under the plan.

The targets are outlined in the Country Programme Document 2026-2031, prepared by the commerce ministry with financial support from the World Trade Organisation (WTO).

The programme aligns with the BNP's election manifesto and the "Smooth Transition Strategy" prepared during the previous Awami League administration.

Under the plan, Bangladesh aims to increase services exports to $10 billion within five years while expanding the number of exportable products by 60%. It also seeks to raise export-oriented investment from 0.65% of GDP to 1%.

The strategy comes at a time when Bangladesh's financial sector remains under pressure, private sector investment growth is at its lowest level on record, and many businesses are unable to start production despite making investments because of energy shortages.

The plan also follows decades of limited progress in export diversification and efforts to improve the investment climate.

The Country Programme places strong emphasis on modernisingtrade infrastructure, attracting FDI and reducing Bangladesh's heavy dependence on the ready-made garments sector.

Prepared jointly by the Ministry of Commerce and the WTO's Enhanced Integrated Framework (EIF), the report stresses the need to make the business and investment environment simpler and more modern, alongside wide-ranging regulatory reforms.

The programme has initially identified 52 projects to help achieve its objectives. It also outlines the expected financial and technical support from development partners, alongside the respective roles of the government and business organisations.

Investment constraints

Mahmud Hasan Khan Babu, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said higher public, private and foreign investment would be essential if Bangladesh was to achieve its 2031 targets.

"Private investment is currently at its lowest level in history. This is due to the gas and electricity crisis, infrastructure bottlenecks and high bank lending rates," he told The Business Standard after reviewing the programme.

"If reliable gas and electricity supplies cannot be ensured and lending rates are not brought down to single digits, investment will not increase and these targets will remain beyond reach."

Implementation key to success

The commerce ministry held a validation workshop on Sunday to finalise the five-year programme.

At the event, Commerce Secretary Md Ataur Rahman Khan said preparing policies and research reports alone would not be enough, stressing that successful implementation would determine whether the programme achieved its objectives.

Former additional secretary and EIF consultant Md HafizurRahman said development partners would provide financial and technical assistance to support implementation. "If the government takes the right decisions at the right time and implements them effectively, achieving these targets will become much easier."

The programme also states that Bangladesh's progress will be assessed against various international benchmarks to measure both the implementation of reforms and improvements in the country's overall capacity.

Preparing for post-LDC challenges

Government reports have warned that once Bangladesh graduates from LDC status, it will gradually lose duty-free and quota-free market access, simplified rules of origin and flexibilities under the WTO's Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), with potential implications for exports and investment.

Bangladesh is officially set to graduate from its LDC status on 24 November 2026.

However, citing global economic uncertainty and persistent structural vulnerabilities, the government has sought a three-year extension of the preparatory period until 2029. The request has been endorsed by the UN Committee for Development Policy (CDP) and is awaiting final approval from the UN General Assembly.

To address the challenges, the government plans to sign free trade agreements (FTAs) or economic partnership agreements (EPAs) with nine countries over the next five years.

Bangladesh currently has an EPA only with Japan. Negotiations are under way with India, China, South Korea, Singapore, Indonesia, the United Arab Emirates, the European Union and several other trading partners.

The action plan targets an increase in per capita income from $2,820 in 2026 to $5,000 by 2031. It also aims to double services exports from $5 billion to $10 billion.

The document also describes Bangladesh's services export earnings as disappointing.

"More than 56% contribution in the GDP is coming from service sectors. But the exports in these sectors are minimal; they are not more than $7 billion. Product-based export earnings have limits to be explored," it says.

"Poor logistics efficiency, inadequate tourism infrastructure and limited strategic foreign investment in service industries reduce competitiveness. As Bangladesh transitions from LDC status, the service sector will face stronger international competition, making regulatory reform, skills upgrading, digital transformation and a long-term service trade development roadmap critical for sustainable growth," it adds.

Export diversification, reforms

The programme places strong emphasis on export diversification, noting that Bangladesh currently exports around 500 products worth more than $1,000 each. It aims to increase that number to 800 within five years.

The commerce ministry also plans to raise export-oriented investment from 0.65% of GDP to 1%.

The report says Bangladesh is currently utilising only 71% of the trade preferences available to it as an LDC because of limited export diversification. The government aims to increase that utilisation rate to 80% over the next five years.

Alongside trade and investment targets, the programme gives priority to regulatory reforms.

Bangladesh currently scores 25.7 on the Regulatory Quality Index. The government aims to raise that score to 40 within five years, saying the target is achievable because of strong political commitment at the highest levels to implement regulatory reforms.

The government also plans to improve the country's score on the Investment Facilitation Index from 65.6 to 80 over the next five years through its reform agenda.

According to the Global Economic Diversification Index, Bangladesh scored 95 on the Trade Diversification Index in 2025. The programme aims to raise that score to 130 by 2031 by encouraging greater private sector diversification and higher value addition.

Bangladesh has the potential to achieve in a much shorter period the level of economic development that the Republic of Korea attained over the past 70 years, Kim Ji-Joon, the newly appointed South Korean ambassador to Bangladesh, said yesterday.

He made the remarks at a reception hosted by the Korea-Bangladesh Chamber of Commerce and Industry (KBCCI) at Hotel Amari in Dhaka to welcome him, according to a press release.

Kim said Bangladesh could accelerate its path to sustainable economic growth by drawing lessons from South Korea’s development experience while avoiding the mistakes it made along the way.

Highlighting the long-standing friendship between the two countries, he stressed the importance of deepening economic ties to ensure their shared long-term prosperity. He called for greater bilateral cooperation in trade, investment, technology transfer and joint ventures.

Speaking at the event, KBCCI President Shahab Uddin Khan reaffirmed the chamber’s commitment to strengthening bilateral trade, investment and economic cooperation between Bangladesh and South Korea. Welcoming the new ambassador, he expressed confidence that Kim’s tenure would mark a new chapter in bilateral relations and help deepen the economic partnership between the two friendly nations.

Md Nazrul Islam, secretary (bilateral) at the Ministry of Foreign Affairs, said the economic and commercial relationship between Bangladesh and South Korea had continued to strengthen over the years.

He emphasised the need to further expand cooperation through industrialisation, technology transfer, investment promotion and human resource development, while commending the KBCCI for its role in enhancing economic ties between the two countries.

During the programme, Kim presented a certificate of merit, signed by South Korean Foreign Minister Cho Hyun, to Shahab Uddin Khan in recognition of his contribution to strengthening economic cooperation, promoting bilateral trade and supporting South Korea’s diplomatic activities in Bangladesh.

Ambassadors and high commissioners from various countries, senior government officials, members of the diplomatic corps, business leaders and KBCCI members also attended the event.

Bangladesh has decided to participate in 50 international trade fairs across 27 countries in the current fiscal year, prioritising exhibitions featuring products from 12 sectors as part of efforts to attract more international buyers.

The decision was taken at a meeting of the Export Promotion Bureau (EPB) at its office in Dhaka.

The meeting also fixed January 1 as the opening date for the 31st edition of the Dhaka International Trade Fair (DITF) next year, according to a statement released by the commerce ministry yesterday.

Many businesses, especially small and medium-sized enterprises, do not have the financial capacity to explore foreign trade opportunities, Commerce Minister Khandakar Abdul Muktadir said at the meeting.

Participation in international trade fairs will help improve the business networking opportunities for these entrepreneurs, he said.

Leather and leather goods, light engineering. and agro-processing have the potential to achieve double-digit export growth, Muktadir said.

Today’s large companies started out as small businesses, so new entrepreneurs and startup founders should be provided with opportunities to grow in the future, he said.

The minister also reiterated that the government has been working to cut red tape and create a business- and investment-friendly environment in the country, the statement said.

The ongoing forensic audit of key official statistics disclosed during the previous governments, including gross domestic product (GDP) and the consumer price index, is likely to be completed this month, according to an official.

A seven-member committee, led by Statistics and Informatics Division (SID) Secretary Md Firoz Sarker, is carrying out the audit on data produced by the Bangladesh Bureau of Statistics (BBS). The panel includes five government officials and two Dhaka University professors.

Once completed, the report will be submitted to Prime Minister’s Finance and Planning Adviser Rashed Al Mahmud Titumir. The audit comes after debate over Bangladesh’s official economic growth figures during the Awami League government.

The interim government had formed an expert taskforce to assess the quality, transparency and accessibility of official statistics. After taking office, the BNP-led government said it was prioritising an in-depth investigation and review to determine whether any official data had been incorrect or distorted.

The committee is reviewing historical GDP and consumer price index data, cross-checking BBS figures against the Bangladesh Bank records to verify sector-wise estimates

As part of that process, the SID-led committee was due to submit its report by July 15. However, it missed the deadline and now needs more time, according to planning ministry sources.

The committee is reviewing historical GDP and consumer price index data, cross-checking BBS figures against the Bangladesh Bank records to verify sector-wise estimates. It is also assessing progress on the Open Government Data initiative.

“It is a very challenging exercise because we are tracing the figures back to the source data,” said a committee member on condition of anonymity.

The committee is revisiting the GDP estimates for each financial year based on the 2005-06 base year. “Given the debate surrounding these figures, this work will be very important,” the member said.

He said the review is taking longer than expected because of the scale of the verification.

“This is a huge research exercise. We are sitting down to examine where every figure came from,” he said, adding that the team hopes to finish within the month.

Another committee member said the review is focused on strengthening the methodology rather than revisiting past growth figures.

“Our main objective is to identify methodological loopholes in GDP estimation and determine how they can be closed so that the statistics are produced more accurately,” he said.

As part of that work, the team is tracing how estimation methods evolved from the 2005-06 GDP base year to the 2015 base year and through later revisions to identify where weaknesses may have emerged.

“Our task is not to validate the populist speculative claims but to ensure the methodology is strong enough so that such concerns cannot arise in future.”

He said the review has already uncovered cases of incomplete documentation.

“In many cases, there are no records explaining how certain figures were generated. We are trying to identify those gaps so the process becomes more transparent and reliable,” he said.

“If the methodology or the process is weak, any government could face the same problem. Our objective is to strengthen the system itself,” he said.

In June, State Minister for Planning Zonayed Abdur Rahim Saki said that all past data was being re-examined.

“It is being looked into whether any information has been manipulated. The government is now emphasising in-depth investigation and review to identify incorrect and distorted data,” he said.

Bangladesh's GDP growth slowed to 2.22% year-on-year at constant prices in the third quarter (January-March) of FY2025-26, down from 4.53% in the corresponding quarter of the previous fiscal year.

The Bangladesh Bureau of Statistics (BBS) released the third-quarter GDP estimates for FY26 today (20 July).

According to the quarterly data, the economy grew by 4.96% and 3.03% in the first and second quarters of FY26, respectively, compared with 3.91% and 3.53% in the corresponding quarters of the previous fiscal year.

At current prices, the size of the economy reached Tk15.391 trillion in the third quarter of FY2025-26, up from Tk14.192 trillion in the same quarter a year earlier.

BBS data show that growth slowed across all three major sectors – agriculture, industry and services – compared with the same period of the previous fiscal year.

Agricultural sector growth declined to 1.74% in the third quarter, from 4.61% a year earlier. The sector had grown by 2.11% and 3.68% in the first and second quarters of the current fiscal year, compared with -0.12% and 1.90% in the corresponding quarters of FY2024-25.

The industrial sector recorded negative growth of 0.28% in the third quarter, a sharp reversal from 3.33% growth in the same period last year. However, the sector had expanded by 6.82% and 1.27% in the first and second quarters of FY2025-26, compared with 4.80% and 5.78% in the corresponding quarters of the previous fiscal year.

Growth in the services sector slowed to 3.52% in the third quarter from 7.32% a year earlier. During the first and second quarters of the current fiscal year, the sector grew by 4.51% and 4.45%, compared with 4.49% and 5.84%, respectively, in the same quarters of FY2024-25.

Economists said the slowdown across all three major sectors in the third quarter, particularly the contraction in industry, signals growing concerns for the economy.

Dr Sayema Haque Bidisha, professor of economics at the University of Dhaka, said it would be inappropriate to draw policy conclusions based on GDP growth data from a single quarter.

"Quarterly growth figures are heavily influenced by the base effect – the level of growth recorded in the same quarter of the previous year. If growth was unusually high or low in the base period, the current year's growth rate may appear disproportionately different. Therefore, one quarter's data alone should not be used to assess the overall state of the economy," she said.

Bidisha added that the broader economic context of the January-March quarter should also be considered.

"National elections were held during this period, which may have affected normal economic activity and, consequently, GDP growth," she said.

However, she identified the negative growth in the industrial sector as the most worrying development.

"This is a warning signal for the economy and calls for prompt policy intervention. While very high agricultural growth is not expected, post-election changes in supply chains may also have had some impact," she said.

According to Bidisha, the performance of the industrial sector in the April-June quarter will be crucial. "If growth remains weak, major policy and strategic measures will be needed to revive the sector, as industrial growth is directly linked to employment, industrialisation and the country's overall economic expansion," she said.

Regional bloc Bimstec is pursuing alternative mechanisms to boost trade and investment among its seven member-states while negotiations on a long-pending free-trade agreement (FTA) continue, says its chief executive.
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The forum's Secretary-General, Indra Mani Pandey, explained the trade-promotion programme to journalists on Tuesday during an interaction with members of the Diplomatic Correspondents Association of Bangladesh (DCAB) at the headquarters of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (Bimstec) in Dhaka.

He said the FTA negotiations remained a complex process involving multiple countries with differing priorities, but expressed optimism that progress could be made on several constituent agreements in the coming months and years.

The Bimstec FTA framework agreement was signed in 2004. Subsequently, a Trade Negotiation Committee (TNC) was established along with six working groups to negotiate six constituent agreements covering different areas of the proposed trade pact.

"The working groups have been meeting from time to time, and in some subgroups we have made significant progress. We are quite hopeful that in the coming months and years we will see progress in the finalisation of some of the constituent agreements," Pandey said.

He noted that multilateral trade negotiations naturally take longer than bilateral FTAs because member-countries seek to balance regional trade liberalisation with their respective national priorities and concerns.

"FTA is one mechanism for enhancing trade, but it is not the only mechanism."

To strengthen economic cooperation while the negotiations continue, Bimstec is promoting several complementary initiatives aimed at facilitating business and investment across the region.

Among the proposals are establishing a Bimstec Chamber of Commerce and Industry to strengthen business-to-business links, creating a platform for investment-promotion authorities to encourage cross-border investment, and exploring cooperation on common standards to reduce non-tariff barriers to trade.

Pandey said differences in standards remain a significant obstacle to expanding intra-regional trade, and member-states are examining whether greater harmonisation could help facilitate commerce.

"The goal is very clear. We need to have more trade and investment in our region. There are many opportunities to pursue, and that's where Bimstec is fully focused."

Bangladesh, which recently assumed the Bimstec chairmanship, intends to accelerate the negotiation process by convening meetings of the Trade Negotiation Committee and its working groups more frequently to provide "the much-needed push" towards concluding the pending agreements, he told the reporters.

On regional connectivity, Pandey said member-states are also working on a visa-facilitation scheme to promote business travel, tourism and people-to-people exchanges.

An expert group on visa measures agreed last year to work towards such a framework. However, discussions are continuing as the members have yet to reach a consensus on the specific provisions of the proposed scheme.

"All member-states fully understand that if we need to have more trade, more travel, more tourism and more exchanges among our member-states, ease of travel through visa facilitation is very important," he observed.

Looking ahead, Pandey has noted that Bangladesh's second year as Bimstec chair in 2027 will coincide with the organisation's 30th anniversary, raising the possibility that the next Bimstec Summit could also serve as a platform to commemorate the milestone.

He notes that Bimstec continuously reviews the implementation of its programmes through regular meetings of experts, senior officials and ministers.

Action plans are updated periodically to incorporate new areas of cooperation, with all initiatives undertaken on the basis of consensus among the seven member-states.

State-owned Biman Bangladesh Airlines is set to sign another multibillion-dollar agreement with European aerospace giant Airbus by 31 August to purchase 10 aircraft, adding a second major order to its recent $3.7 billion deal with US manufacturer Boeing.

"The government has decided to proceed with the acquisition of 10 Airbus aircraft," State Minister for Civil Aviation and Tourism M Rashiduzzaman Millat told The Business Standard. "We hope to sign the agreement by 31 August."

"However, the Airbus aircraft will not be delivered immediately. Deliveries are expected to begin from 2031. Therefore, until the new aircraft arrive, we will have to strengthen the fleet by leasing aircraft," he added.

Millat said details of the procurement, including the price and other terms and conditions, would be disclosed after the agreement is finalised, adding that negotiations are going on.

Talks advance at Farnborough Airshow

The proposed deal gained momentum at the Farnborough International Airshow 2026 in the United Kingdom, where Airbus and Biman officials met yesterday to discuss the timeline for signing the agreement, according to Airbus sources.

"The meeting at the Farnborough Airshow discussed the progress of the proposed agreement and the next steps in the timeline," an Airbus spokesperson based in South Asia told TBS.

He said the national flag carrier had sent a letter to Airbus this week expressing its intention to sign the agreement by 31 August.

"This is the first time we have received a clear commitment from Biman," the spokesperson said.

Biman Managing Director and Chief Executive Officer Kaizer Sohel Ahmed, accompanied by four senior officials from flight operations, engineering and corporate planning, travelled to the UK on 19 July to attend the airshow.

Airbus Vice President Edward Delahaye also recently met Civil Aviation and Tourism Minister Afroza Khanam, State Minister Millat and senior Biman officials in Dhaka to advance discussions on the proposal.

Fleet expansion plans

The proposed purchase comes as the government reviews a long-term roadmap to expand Biman's fleet to 47 aircraft by the fiscal 2034-35 as part of efforts to modernise the flag carrier, strengthen international connectivity and establish Bangladesh as a regional passenger and cargo hub.

Biman currently operates 19 aircraft, 14 of which are manufactured by Boeing. With the addition of the Boeing and Airbus orders, the fleet would expand to 43 aircraft.

Because neither manufacturer is expected to deliver new aircraft before 2030, Biman plans to lease 10 aircraft by next year to address its fleet shortage.

Industry insiders said Bangladeshi airlines are expanding their fleets in anticipation of rising passenger demand and additional capacity following the expected opening of Hazrat Shahjalal International Airport's Third Terminal later this year.

Board approval still pending

Although the government has publicly expressed its interest in purchasing Airbus aircraft, the deal still requires internal corporate and government approvals, according to Airbus.

"Although Biman's Board had earlier given policy approval on certain aspects, the issue of the down payment has not yet been finalised. Therefore, the proposal will have to be placed before the Board again before the agreement can be signed," the Airbus spokesperson said.

He added that advance payments are standard international practice in aircraft procurement, with around 1% of the total contract value typically paid upfront, although the amount may vary depending on negotiations.

Biman acting spokesperson Md Mohiuddin confirmed that the government approval process is underway.

Asked about the price of the aircraft, the Airbus spokesperson said: "We cannot make the price public because of legal obligations. However, the customer may disclose it after the agreement is signed."

According to aviation news portal Simple Flying, Airbus's flagship A350-900 wide-body aircraft had a list price of $317.4 million in late 2023, while the larger A350-1000 was listed at $366.5 million. The A320ceo carried a list price of $101 million, while the A320neo was priced at $110.6 million.

Airbus revises proposal

According to Airbus and Biman sources, the European manufacturer has revised its proposal, reducing its earlier offer from 14 aircraft to 10 following Biman's agreement with Boeing in April.

The latest proposal, submitted to Biman's techno-finance committee, includes four A350-900 wide-body aircraft and six A321neo narrow-body jets.

The revised offer comes less than three months after Biman signed a $3.7 billion agreement with Boeing on 30 April to purchase 14 aircraft, including eight Boeing 787-10 Dreamliners, two Boeing 777-9 aircraft and four Boeing 737 MAX aircraft.

Airbus and Boeing have competed for a place in Biman's future fleet for several years, attracting considerable diplomatic and commercial interest from both the United States and Europe.

Debate over a mixed fleet

Former Civil Aviation Authority of Bangladesh chairman Air Vice Marshal (retd) M Mafidur Rahman said he supports a mixed fleet comprising both Boeing and Airbus aircraft.

According to Rahman, reliance on a single manufacturer exposes airlines to operational risks if one manufacturer's aircraft encounter technical or regulatory problems.

However, he cautioned that operating aircraft from two manufacturers would increase maintenance costs, training requirements and technical complexity.

"A mixed fleet certainly involves additional costs. But with proper planning, it also offers strategic advantages. The most important thing is that Biman prepares a comprehensive commercial and operational plan so that the government and the public clearly understand the benefits expected from this investment," he said.

Rahman added that Biman has significant opportunities to expand revenue and strengthen its international competitiveness, but that achieving those goals would require professional management, policy continuity and a long-term strategy.

Europe's long campaign

Industry insiders said Airbus scaled back its original proposal as part of a strategic effort to remain competitive in Bangladesh's long-term fleet expansion programme.

The company had earlier proposed supplying 14 aircraft, including 10 A350 wide-body jets and four A320neo narrow-body aircraft.

Diplomats from France, the United Kingdom and Germany have repeatedly encouraged Bangladesh to consider Airbus aircraft as part of a balanced procurement strategy.

Airbus's campaign gained momentum in 2023 following French President Emmanuel Macron's visit to Bangladesh and references in the Bangladesh-UK Joint Statement to the possible acquisition of 10 Airbus A350 aircraft, including freighters.

On 4 November last year, the ambassadors and high commissioners of France, Germany, the United Kingdom and the European Union publicly urged Biman to diversify its Boeing-heavy fleet, arguing that a more balanced mix would improve operational resilience and competitiveness.

According to people familiar with the matter, at least two high-level meetings involving European envoys and senior officials from Bangladesh's aviation sector were held this month to discuss the proposal.