Bangladesh's e-commerce sector has moved far beyond its early days of scepticism, emerging as a fast-evolving part of the country's digital economy.

At the center of this transformation is Daraz Bangladesh, the country's largest online marketplace.

Ben Yi, chief commercial officer of Daraz Group and managing director of Daraz Bangladesh, has overseen a year of steady operational upgrades, trust-building initiatives, and ecosystem development.

In an interview with Abbas Uddin Noyon of The Business Standard, he reflects on Daraz's journey, the lessons learned, and why he believes Bangladesh is approaching a new phase of e-commerce maturity.

Bangladesh's e-commerce journey has moved from low trust to much wider adoption. What were the most important shifts behind this transition?

Several factors came together. Smartphone penetration and digital wallets expanded rapidly, logistics became more convenient, and marketplaces grew as more sellers joined. This is a natural evolution seen in many countries. Bangladesh is still in an early stage e-commerce accounts for only about 2-3% of total retail but the potential is significant.

We can easily reach double-digit penetration in the coming years. At Daraz, we focused on shortening delivery times, introducing single-warehouse fulfillment, and improving reliability, which made online shopping faster and more convenient for consumers.

Looking back at 2025, what were the defining moments for Daraz Bangladesh?

There wasn't a single defining moment. Instead, 2025 was shaped by consistent progress through many small, detailed improvements month after month. These efforts reduced logistics lead times, lowered costs, and strengthened our commercial strategies, including building our Everyday Low Price (EDLP) channel and enhancing Flash Sales. We applied Alibaba's global experience through technology and product innovation, while adapting it to Bangladesh's market reality. This steady approach delivered strong results throughout the year.

Customer trust remains a major challenge. Why did Daraz decide to extend its return policy to 14 days across the entire platform?

Trust is fundamental to e-commerce growth. In Bangladesh, past market incidents made many consumers cautious about shopping online. Extending the return window to 14 days across the entire platform was a deliberate decision to address this directly. We want customers to feel protected and confident that Daraz will support them through refunds, replacements, or resolution if something goes wrong. This reinforces our long-term commitment to making online shopping safer and more reliable.

DarazMall has become central to your authenticity strategy. How does it work, and what impact has it had?

DarazMall is our crown jewel, inspired by Alibaba's Tmall. While we maintain strong quality controls across the entire platform, DarazMall verifies that sellers are reliable brand owners committed to long-term service and authenticity. We strengthened governance, added more brands, and introduced flagship stores with clear Mall tags for quicker purchase decisions. Our Authenticity Guarantee ensures replacement and three times cash back if a product is proven fake. This has significantly boosted customer confidence and brand performance in 2025.

How are you supporting sellers, particularly SMEs, to succeed in digital commerce?

From the beginning, we focused on building a strong seller ecosystem. Tools like backend systems, Daraz University, and incentives such as free delivery and virtual bundles help simplify selling. This allows SMEs to focus on sourcing quality products and managing supply chains.

Going forward, we are integrating AI tools to optimise listings, improve content relevance, and streamline buyer interactions. Drawing on Alibaba's experience, we want to empower more sellers to build sustainable businesses on Daraz.

Daraz Express has grown into a major logistics operation. What is its current scale?

When we entered Bangladesh, reliable logistics were limited, so we built Daraz Express to ensure customer satisfaction. Today, it handles over 70% of our parcels, and we are expanding it as a service for external brands and partners. Our fully digitalised system offers real-time tracking, and we have reduced end-to-end delivery to around two days. We are also launching same-day delivery in Dhaka soon, supporting demand across all 64 districts.

What have campaign events revealed about Bangladeshi consumer behaviour?

Mega campaigns like 11.11 have been hugely successful, and we now work with brands to offer compelling deals on a monthly basis. Consumers value strong discounts on big-ticket items during campaigns, while also returning for daily essentials. Operationally, we scaled warehouses and logistics to handle volume surges. During the last 11.11, deliveries were nearly as fast as regular orders, which shows how far our capabilities have come.

Why has Daraz invested heavily in talent development and inclusion?

Our success depends on our people. By attracting top talent and investing in their growth, we are building future e-commerce leaders for Bangladesh. The Daraz Future Leaders Programme helps young graduates gain fast, cross-functional exposure, while the dWomen initiative promotes female leadership and diversity. Inclusive teams bring better ideas and stronger insights into consumer behaviour, which ultimately benefits the business.

What are the biggest regulatory challenges facing the sector?

E-commerce in Bangladesh is still at an early stage, with significant long-term potential. Clear, stable, and practical policies are essential to support growth. As the country's largest e-commerce platform, Daraz works closely with policymakers to share industry insights and highlight operational challenges and opportunities, including areas like cross-border commerce and SME support.

What excites you most about Bangladesh's e-commerce future?

I'm excited by Bangladesh's prospects for stable economic growth, increased foreign investment, and rising consumer incomes. Daraz aims to accelerate e-commerce penetration by improving speed, service quality, and assortment depth, while helping professionalise the industry. Our long-term vision is a trusted, mature e-commerce ecosystem that delivers the best shopping experience for consumers and sellers and contributes meaningfully to the broader economy.

The government has increased monthly allowances and expanded beneficiary coverage for 15 social safety net programmes (SSNPs) for the upcoming fiscal year 2026-27 (FY27), which begins in July.

The Finance Division announced the decisions in a press statement yesterday following the 32nd meeting of the Advisory Council Committee on SSNPs, chaired by the finance adviser.

However, the move has drawn criticism from policy experts, who questioned the timing as the interim government has less than a month remaining in office. They also noted that implementation will fall to the next elected government, which is likely to follow its own manifesto commitments.

WHO GETS HOW MUCH

Under the Ministry of Social Welfare’s old age allowance programme, the number of beneficiaries has been increased by 1 lakh to 62 lakh. Of them, 59.95 lakh elderly citizens will receive Tk 700 per month, up from Tk 650, while 2.05 lakh people aged over 90 will receive Tk 1,000.

Allowances for “widows and husband-deserted women” have also been raised. Of the 29 lakh beneficiaries, 28.75 lakh will receive Tk 700 per month, while 25,000 women aged over 90 will receive Tk 1,000.

For persons with disabilities, the total number of beneficiaries under the disability allowance and education stipend programme has been increased to 36 lakh from 34.5 lakh. Most will receive Tk 900 per month from FY27, while 18,100 beneficiaries will receive Tk 1,000.

Education stipends for students with disabilities have been increased by Tk 50 at all levels. The revised rates are Tk 950 for primary, Tk 1,000 for secondary and Tk 1,350 for higher education.

Under the programme for “improving living standards of backward communities”, the number of beneficiaries has increased by 7,000 to over 2.28 lakh, while the monthly allowance has been raised from Tk 650 to Tk 700.

The number of student beneficiaries from backward communities has also been increased by 3,198 to 45,338. For FY27, monthly stipends have been set at Tk 700 for primary, Tk 800 for secondary, Tk 1,000 for higher secondary and Tk 1,200 for higher education levels.

In addition, 5,490 beneficiaries will receive skills development training under the programme.

Beneficiaries under the financial assistance programme for patients suffering from serious illnesses, including cancer, kidney disease, liver cirrhosis, stroke, related paralysis, congenital heart disease and thalassemia, have increased by 5,000 to 65,000. The one-time medical assistance has been doubled from Tk 50,000 to Tk 100,000.

The “mother and child benefit” programme under the Ministry of Women and Children Affairs will cover more than 18.95 lakh mothers, an increase of 1.24 lakh, with a monthly allowance of Tk 850.

The “food-friendly programme” of the Ministry of Food will support 60 lakh families starting FY27, up 5 lakh, providing 30 kg of subsidised rice for six months at Tk 15 per kg.

The Advisory Council committee meeting also raised the monthly allowances for Gallantry Awards-winning freedom fighters and families of martyred freedom fighters by Tk 5,000.

At the meeting, it was recommended that the monthly honorarium allowances for the families of martyrs and the injured from the July Mass Uprising, which fall under the Ministry of Liberation War Affairs, and the Vulnerable Group Feeding (VGF) programme under the Ministry of Fisheries and Livestock, be brought within the purview of the committee on SSNPs.

The meeting further recommended that in FY27, an additional 273,514 fishermen be newly included, bringing the total number of fishermen under the VGF programme to 15 lakh.

Officials said these revisions aim to enhance social protection and address the needs of vulnerable populations ahead of the next fiscal year.

However, policy experts say otherwise.

Mustafa K Mujeri, executive director of the Institute for Inclusive Finance and Development (InM), said the interim government has less than one month. A new government will come, and they will implement their own programmes in line with their manifestos.

“At this stage, there is no justification for taking any such decision,” he said.

The interim government could hike allowances and the number of beneficiaries in this fiscal year to give a better cushion to low-income people struggling amid persistent inflation, he added.

Selim Raihan, executive director at the South Asian Network on Economic Modeling (Sanem), said the interim administration could have increased the social safety nets allocation at the beginning of this fiscal year when it had time, and the pressure of inflation was high.

US President Donald Trump on Saturday warned Canada that if it concludes a trade deal with China, he will impose a 100 percent tariff on all goods coming over the border.

Relations between the United States and its northern neighbor have been rocky since Trump returned to the White House a year ago, with spats over trade and Canadian Prime Minister Mark Carney decrying a “rupture” in the US-led global order.

During a visit to Beijing last week, Carney hailed a “new strategic partnership” with China that resulted in a “preliminary but landmark trade agreement” to reduce tariffs -- but Trump warned of serious consequences should that deal be realized.

If Carney “thinks he is going to make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken,” Trump wrote on his Truth Social platform.

“China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life,” he said.

“If Canada makes a deal with China, it will immediately be hit with a 100 percent Tariff against all Canadian goods and products coming into the USA.”

Trump insulted Carney by calling him “Governor” -- a swipe referring to the US president’s repeated insistence that Canada should be the 51st US state.

Trump this week posted an image on social media of a map with Canada -- as well as Greenland and Venezuela -- covered by the American flag.

Canada’s minister responsible for trade with the United States, Dominic LeBlanc, pushed back against Trump’s latest threat. “There is no pursuit of a free trade deal with China. What was achieved was resolution on several important tariff issues,” he wrote on X.

The two leaders have sharpened their rhetorical knives in recent days, beginning with Carney’s speech on Tuesday at the World Economic Forum in Davos, where he earned a standing ovation for his frank assessment of a “rupture” in the US-led global order.

His comment was widely viewed as a reference to Trump’s disruptive influence on international affairs, although Carney did not mention the US leader by name.

Trump fired back at Carney a day later in his own speech, and then withdrew an invitation for the Canadian prime minister to join his “Board of Peace” -- his self-styled body for resolving global conflict.

Initially designed to oversee the situation in postwar Gaza, the body appears now to have a far wider scope, sparking concerns that Trump wants to create a rival to the United Nations.

“Canada lives because of the United States. Remember that, Mark, the next time you make your statements,” Trump said.

Carney shot back on Thursday: “Canada doesn’t live because of the United States. Canada thrives because we are Canadian.” He nevertheless acknowledged the “remarkable partnership” between the two nations.

Canada heavily relies on trade with the United States, the destination for more than three quarters of Canadian exports.

Key Canadian sectors like auto, aluminum and steel have been hit hard by Trump’s global sectoral tariffs, but the levies’ impacts have been muted by the president’s broad adherence to an existing North American free trade agreement.

Negotiations on revising that deal are set for early this year, and Trump has repeatedly insisted the United States doesn’t need access to any Canadian products -- which would have sweeping consequences for its northern neighbor.

Matthew Holmes, executive vice president of the Canadian Chamber of Commerce, said in a statement that he hoped the two governments would “come to a better understanding quickly that can alleviate further concerns for businesses.”

The two nations, along with Mexico, are set to host the World Cup later this year.

Mutual Trust Bank PLC has announced plans to raise Tk346 crore in Tier-1 capital to strengthen its core capital base and support future growth.

The decision was taken at a meeting of the bank's board of directors and is subject to approval from the relevant regulatory authorities, according to a disclosure filed with the Dhaka Stock Exchange on Thursday (22 January).

The proposed capital raising represents about 32% of the bank's existing paid-up capital, which currently stands at Tk1,081 crore.

As of the end of 2024, Mutual Trust Bank's consolidated Tier-1 capital amounted to Tk2,467.53 crore, while its capital to risk-weighted assets ratio (CRAR) stood at 13.62%, comfortably above the regulatory requirement of 12.50%.

Speaking to The Business Standard, the bank's Managing Director, Syed Mahbubur Rahman, said the board's decision was driven by the need to further strengthen the bank's risk-based capital position amid a changing economic and regulatory environment.

He noted that the capital may be raised through a rights offer, issuance of preference shares, bonds, or another instrument in line with Bangladesh Securities and Exchange Commission regulations.

Tier-1 capital, often referred to as core capital, is considered the highest quality capital for banks as it primarily consists of common equity, retained earnings and disclosed reserves. It serves as a key buffer to absorb losses and is a critical indicator of a bank's financial strength under the Basel regulatory framework.

According to the bank's unaudited financial statements, the bank posted a net profit of Tk203.84 crore during the January–September period of 2025, nearly unchanged from Tk203.74 crore in the same period a year earlier. Its earnings per share also remained steady at Tk1.88.

For the full year of 2024, the private sector lender reported a net profit of Tk316.65 crore with an EPS of Tk3.22, and distributed a 10% stock dividend to its shareholders.

The inaugural ceremony of Sammilito Islami Bank, scheduled for 10am tomorrow (25 January) at Hotel Intercontinental Dhaka, has been postponed.

Arief Hossain Khan, spokesperson for Bangladesh Bank, confirmed the matter to the media.

Salehuddin Ahmed was scheduled to attend as chief guest, while special guests were to include Finance Secretary Md Khairuzzaman Mozumder, and Governor of Bangladesh Bank Ahsan H Mansur. The programme was to be presided over by Sammilito Islami Bank Chairman Mohammad Ayub Miah.

Other attendees were expected to include senior officials from Bangladesh Bank, the Finance Ministry, and the country's top financial institutions.

Sammilito Islami Bank PLC was formed through the merger of First Security Islami Bank, Global Islami Bank, Social Islami Bank, Exim Bank, and Union Bank.

The new bank boasts one of the largest capital structures in Bangladesh's banking history, with an authorised capital of Tk40,000 crore and a paid-up capital of Tk35,000 crore – Tk20,000 crore contributed by the government and Tk15,000 crore through conversion of depositors' shares.

Despite posting double-digit revenue growth, listed telecommunications company ADN Telecom saw its net profit fall sharply in the first half of the current fiscal year, weighed down by rising costs and narrowing margins.

According to the company's quarterly financial statements, ADN Telecom's consolidated revenue rose 12.73% year-on-year to Tk100.74 crore during the July–December period. However, its net profit declined 21% year-on-year to Tk8.10 crore over the same period.

The company attributed the profit drop mainly to higher costs. Quarterly reports show that the cost of services and goods sold increased by around 4%, while the gross profit margin declined despite revenue growth. The cost of sales accounted for 63.62% of total revenue in the first half of the fiscal year, up from 59.67% in the corresponding period of the previous year.

In addition, administrative and distribution expenses rose significantly compared to the same period last year, further pressuring profitability.

As a result, earnings per share (EPS) fell to Tk1.26 for the July–December period, down from Tk1.58 a year earlier.

Commenting on its performance, ADN Telecom said it maintained positive growth momentum, achieving nearly 13% year-on-year revenue growth during the period. The company said the increase was driven primarily by effective sales execution, particularly revenue from several projects.

However, the company acknowledged that multiple cost and margin pressures affected earnings. These included inflationary impacts across various expense categories, higher employee-related costs, changes in depreciation rates, and price erosion in certain services, all of which had an adverse impact on EPS.

Despite the challenges, ADN Telecom said it remains focused on improving operational efficiency, diversifying its business portfolio, and accelerating growth across multiple revenue streams to ensure sustainable long-term profitability.

The outstanding balance of government debt through the issuance of different securities, mainly treasury bills and bonds, increased further in fiscal year 2024–25, as authorities borrowed more to cover budget deficits amid sluggish revenue collection.

At the end of FY25, the total outstanding balance of government securities rose 28 percent year-on-year to Tk 744,850 crore.

Of the amount, outstanding debt from treasury bonds was Tk 518,995 crore, which increased 27 percent year-on-year.

At the same time, outstanding debt through treasury bills grew 31 percent to Tk 175,131 crore, according to a Bangladesh Bank report on government securities published on Thursday.

Including other securities, such as Shariah-based sukuk bonds, the total outstanding amount of government debt rose to Tk 768,850 crore—12.92 percent of Bangladesh’s gross domestic product (GDP)—at the end of June 2025.

The Bangladesh Bank (BB) said the increase in debt from the banking sector was significant, driven by policy measures to reduce non-tradable securities such as savings certificates, as well as higher financing needs related to budget implementation.

The BB said the banking sector was the leading investor, accounting for 68.87 percent of total outstanding securities, followed by 12.03 percent held by long-term investors such as insurance companies, trust funds, and provident funds.

Individual investors held 1.14 percent of the total outstanding amount.

The BB said that in FY25, the average yields of treasury bills and treasury bonds increased during the first half, followed by a marginal moderation during the second half of the fiscal year.

The report said the net issuance of treasury bonds and bills by the government surged in FY25.

During FY25, the net issuance of treasury bonds was Tk 110,762 crore, which was 165.30 percent higher than that of the previous fiscal year. The net issuance of treasury bills grew more than four times during the period.

Two listed textile companies under New Asia Group reported contrasting financial performances in the first half of FY26, highlighting the uneven impact of domestic and global challenges on Bangladesh's textile and apparel sector.

Malek Spinning Mills posts profit decline

Malek Spinning Mills PLC saw its earnings weaken during July–December FY26, weighed down by rising costs and macroeconomic pressures. The company's consolidated net profit fell 19% year-on-year to Tk68.57 crore, while consolidated earnings per share (EPS) stood at Tk3.54.

The pressure intensified in the October–December quarter, when net profit dropped 37% to Tk31.85 crore and EPS fell to Tk1.65. Company officials attributed the weaker performance to external and internal headwinds, including the continuation of an additional 20% US trade tariff, banking sector instability, a widening financial account deficit, currency volatility, and declining foreign exchange reserves.

Rising commodity prices and persistent inflation further eroded margins. The textile and readymade garment sectors are also grappling with stricter compliance requirements, higher labour costs, and disruptions in power and gas supply all of which have directly increased production costs and affected export revenues.

Rahim Textile delivers strong turnaround

In contrast, Rahim Textile Mills PLC reported a robust performance over the same period. Net profit surged 271% year-on-year to Tk1.71 crore for July–December FY26, with EPS rising to Tk1.81. The October–December quarter also remained positive, with net profit climbing 92% to Tk0.50 crore and EPS at Tk0.54.

Rahim Textile noted that while the global economy remains under strain and the Bangladeshi textile industry faces challenges such as soaring energy prices, higher transportation costs, and reduced government incentives, its turnaround was driven by strategic shifts in operations.

The company invested Tk35 crore to transition from woven grey fabric dyeing, printing and washing to knit garments, seamless dyeing, washing, and accessories production. This move helped increase profit margins by lowering the cost of goods sold and aligning production with market demand.

As part of the strategy, Rahim Textile also shut down technologically obsolete woven dyeing, printing, and finishing units due to high energy costs, lower demand, falling selling prices, and rising raw material expenses.

US President Donald Trump filed a $5 billion lawsuit against JPMorgan Chase and its CEO Jamie Dimon on Thursday, accusing them of debanking him by closing several of his accounts to further a political agenda.

The lawsuit, filed in a Florida state court in Miami-Dade County, accused the largest US bank of violating its own policies by singling out Trump to ride the “political tide.”

JPMorgan denied that it closes accounts for political or religious reasons.

“While we regret President Trump has sued us, we believe the suit has no merit,” it said. “We respect the President’s right to sue us and our right to defend ourselves.”

Later on Thursday, Trump told reporters aboard Air Force One he had not spoken with Dimon about the lawsuit. “You’re not allowed to do what they did,” he said. “So wrong. I don’t know what their excuse would be. Maybe their excuse would be the regulators.”

Trump has also attacked other lenders including Bank of America with allegations of debanking, and recently stirred up industry opposition by demanding a 10 percent cap on credit card interest rates.

Dimon, who has run JPMorgan for two decades and is one of the most influential figures in corporate America, told the World Economic Forum on Wednesday that capping card rates would curb access to credit for many consumers and amount to an “economic disaster.”

At the same time, industry executives have cheered the administration’s push for deregulation, which they say could cut red tape, boost profits and spur economic growth.

Trump accused JPMorgan of violating its principles unilaterally by shutting accounts belonging to him and his hospitality companies.

He also accused Dimon of ordering a malicious “blacklist” to warn other banks about doing business with the Trump Organization and Trump family members, as well as with Trump himself.

“Plaintiffs also suffered extensive reputational harm by being forced to reach out to other financial institutions in an effort to move their funds and accounts, making it clear that they had been debanked,” Trump added.

JPMorgan said it closes accounts that create legal or regulatory risk for the company. “We regret having to do so but often rules and regulatory expectations lead us to do so,” it said. World leaders in government, business, sports, and entertainment attend the America Business Forum in Miami

Shares of JPMorgan closed up 0.5 percent on Thursday and were flat premarket on Friday.

Capital One Financial, another large bank, has sought to dismiss a similar lawsuit filed last March by several Trump plaintiffs, including the president’s son Eric Trump. That lawsuit is still pending.

The White House referred a request for comment to Trump’s private lawyer, who had no immediate comment.

Banks have faced growing political pressure in recent years, particularly from conservatives who say lenders have for political reasons discriminated against industries such as firearms and fossil fuels.

That pressure has intensified during Trump’s second White House term, with the Republican accusing some banks of refusing to serve him and other conservatives. Banks have denied that allegation.

In December, the Office of the Comptroller of the Currency, a leading bank regulator, said in a report that the nine largest US banks have restricted financial services to certain industries as part of a debanking push.

The regulator did not provide specific examples of wrongdoing but said it had found large banks either refused services to some industries or required higher levels of scrutiny from 2020 to 2023.

Those affected included oil and gas companies, cryptocurrency firms, tobacco and e-cigarette manufacturers, and firearm companies, it said. The regulator found that many banks publicly disclosed restrictive policies, often tied to environmental, social and governance goals.

Many banks have since curtailed such practices and the regulator said it is continuing to review thousands of debanking complaints.

Last year, JPMorgan said it was cooperating with inquiries from government agencies and other entities regarding its policies in light of the Trump administration’s push against alleged debanking.

US regulators have also examined whether their own supervisory policies discouraged banks from serving certain corporate customers.

Last year, federal bank regulators said they would stop policing banks based on so-called reputational risk, under which supervisors could penalize institutions for activities that were not explicitly illegal but could expose them to negative publicity or costly litigation.

Some banks viewed the reputational risk standard as vague and subjective, giving supervisors wide discretion.

The industry has also urged regulators to update anti-money laundering rules, which can force banks to close suspicious accounts without explanation.

Islami Bank Bangladesh PLC has decided to form a subsidiary to provide mobile financial services (MFS).

The decision was taken at a meeting of the bank's board of directors today (22 January), held at its boardroom, subject to the completion of all regulatory formalities.

As per the decision, the authorised capital of the proposed subsidiary will be Tk1,000 crore, while the initial paid-up capital will be Tk50 crore. The paid-up capital will be increased gradually in line with investment requirements.

According to a price-sensitive disclosure, Islami Bank will hold at least 51% of the shares of the subsidiary, while the remaining shares may be offered to strategic investors in accordance with Bangladesh Bank's MFS guidelines.

Md. Omar Faruk Khan, managing director of Islami Bank, said, "The bank has decided to launch a Mobile Financial Service (MFS), and the necessary documents are being prepared for submission to the central bank."

According to the bank's website, Islami Bank currently operates its own MFS platform, mCash, which was launched in December 2012.

Through mobile phones, mCash offers services including cash deposits and withdrawals, fund transfer from one account to another, receiving remittance from abroad, checking account balance and mini-statement, giving and receiving salary, mobile recharge and payment of utility bill, merchant bill payment.

According to the bank's unaudited consolidated financial statements, Islami Bank reported a profit of Tk99.77 crore in the first nine months of 2025 (January–September), down from Tk267.72 crore in the same period of 2024. In 2024, the bank posted a net profit of Tk10,878 crore, a significant decline from Tk635.33 crore, and did not pay any dividends to shareholders.

Import activity in Bangladesh showed signs of a modest recovery in the first five months of the current fiscal year (FY26), supported by a stable dollar market and preparations for Ramadan.

However, the recovery remains fragile as businesses adopt a cautious ‘wait-and-see’ approach ahead of the national election.

According to Bangladesh Bank data, Letters of Credit (LC) openings increased by 4.5 percent to $29.69 billion during July–November of FY26, up from $28.4 billion in the same period last year.

The data highlights a gap between LC openings and final payments with high interest rates and political uncertainty slowing settlements.

LC openings surged 32.22 percent to $911 million, reflecting renewed investments in energy-efficient equipment but settlements fell 16.77 percent to $745.5 million.

Ahead of Ramadan, LC openings rose 10.64 percent to $2.85 billion while settlements slightly declined to $2.41 billion, according the data.

Besides, openings increased marginally by 0.42 percent to $10.29 billion, indicating cautious production due to weak domestic demand and limited working capital.

Despite a stable interbank exchange rate at Tk 122 per dollar over the past nine months, high rates have raised import costs and debt servicing burdens.

Overall LC settlements dropped slightly by 0.63 percent to $27.94 billion during the July–November period.

The government is working to make Bangladesh's export sector more diversified and competitive, reducing over-reliance on the readymade garments industry, Commerce Adviser Sk Bashir Uddin said today (22 January).

He made the remarks while speaking as the chief guest at a seminar titled "Role of Competitiveness for Jobs Project on Export Diversification in Bangladesh" at the Bangladesh-China Friendship Exhibition Centre in Purbachal in the afternoon.

The adviser said expanding Bangladesh's presence in global markets requires product diversification, supportive policies and capable entrepreneurs. "Entrepreneurs must be hardworking and build the right knowledge and skills to achieve their goals," he said.

He said the government has started major reforms and investments under the Export Competitiveness for Jobs (EC4J) project to achieve an export target of $100 billion by 2030.

Referring to past policy approaches, the adviser said that for 16 years the country had followed largely utopian, cost-driven plans without adequate grounding.

"Now we are adopting policies, engaging with businesses and debating openly – all in the national interest," he said, adding that the country is trying to position itself amid shifting global geopolitical dynamics.

Commerce Ministry Additional Secretary and EC4J Project Director Md Abdur Rahim Khan delivered the welcome address, while Commerce Secretary Mahbubur Rahman spoke as a special guest at the seminar.

In a move that could reshape the future of Bangladesh's national fish, PRAN-RFL Group is planning to farm hilsa for the first time in the country using advanced indoor aquaculture technology – an approach never before attempted commercially in the country.

The initiative will use recirculating aquaculture system (RAS) technology and be implemented jointly with Denmark-based Assentoft Aqua Limited, with an investment of €30 million, or around Tk430 crore.

Alongside hilsa, the project also plans to culture Asian seabass (coral) and other marine fish in the high-tech and fully controlled indoor environment. An agreement for the project was signed yesterday between PRAN-RFL Group and Assentoft Aqua.

The facility is expected to be set up at the Mirsarai Economic Zone in Chattogram or another suitable location agreed upon by both parties. The full investment will be rolled out in two to three phases over the next two years.

Hilsa is not only Bangladesh's national fish but also a powerful cultural symbol, carrying deep emotional value and commanding an increasingly high value in international markets.

Demand has been rising steadily among Bangladeshi expatriates in the Middle East, Europe, the United States, Canada and Australia. Yet exports remain limited due to dependence on natural sources, changes in river systems and seasonal fishing bans.

High domestic demand also means hilsa is often scarce, even at premium prices.

According to the Department of Fisheries, while overall production has increased in recent years, there is still a shortage of export-quality hilsa. Industry insiders say success in controlled hilsa farming could therefore mark a major breakthrough.

PRAN Group Managing Director Eleash Mridha told TBS the company was responding to growing local and global demand for premium marine fish.

"In view of the rising demand for quality marine fish at home and abroad, PRAN Group wants to farm these species in Bangladesh using modern RAS technology," he said.

"Assentoft Aqua has already been producing fish at an industrial scale in developed countries using this technology in limited spaces. Through this project, industrial-scale seabass production will begin in Bangladesh for the first time."

How RAS technology works

Recirculating aquaculture system, or RAS, is a fully controlled indoor fish farming method where water quality, temperature, oxygen, salinity and waste management are managed through technology. The same water is treated and reused repeatedly, reducing water use and lowering the risk of disease compared to conventional systems.

Under the project, the entire production chain will be established, including broodstock management, hatchery and nursery facilities. The target weight for each hilsa fish has been set at between 1.2 and 1.5 kilograms.

Once fully operational, the facility aims to produce around 2,000 tonnes of hilsa fish per year, a large share of which is intended for export.

Can hilsa be farmed?

Hilsa is a migratory fish, and for decades it was considered unsuitable for farming. In recent years, however, research trials on raising hilsa in controlled environments have begun in Bangladesh, India and Myanmar.

Large-scale commercial production remains rare, making the PRAN-RFL–Assentoft initiative unusual on a global scale.

Dr Amirul Islam, a senior scientist at the Bangladesh Fisheries Research Institute (BFRI), told The Business Standard that hilsa farming is scientifically very challenging.

"The biggest challenge is controlling the hilsa's life cycle and breeding behaviour," he said. "There is no successful record of hilsa farming so far."

If successful, such projects could reduce pressure on natural river systems and open up new export opportunities, he added.

Danish expertise and local ambition

Assentoft Aqua Limited is internationally known for its work with RAS technology. Its associate company, Mariscco ApS, has been providing technical support for fish farming projects in Bangladesh and other countries since 2016, including hatchery design, broodstock management and full RAS solutions.

Dr Jens Ole Olesen, business development director of Assentoft Aqua, said the company was ready to implement an RAS-based fish farming project in Bangladesh with financing guaranteed by the Danish government.

"We are optimistic about our partnership with PRAN-RFL Group," he said.

PRAN-RFL Group is one of Bangladesh's largest agro and food processing companies, with a strong presence in food, agriculture, dairy, beverages and export-oriented products.

Through this new fisheries venture, the group aims to enter the production and export of high-value marine fish, adding a new chapter to its expanding portfolio, according to the group's managing director, Eleash Mridha.

Finance Adviser Dr Salehuddin Ahmed today said that a comprehensive reform of the country's banking sector is unavoidable and critically important for safeguarding macroeconomic stability, restoring discipline in financial institutions, and ensuring sustainable growth.

The Finance Adviser said this while addressing the MTB-FE Roundtable as the chief guest on 'Banking Sector Reforms' held at a hotel in the capital today.

The Adviser said that most banking-related issues primarily fall under the mandate of Bangladesh Bank, although close coordination with the Ministry of Finance remains essential. He acknowledged that the sector is facing long-standing structural and governance challenges which have accumulated over the last decade and a half.

"These problems didn't arise overnight, and they can't be fixed within 14 or 16 months," he said, adding that institutional decay, weak enforcement of laws, erosion of compliance culture, and misuse of discretionary authority have severely affected the sector.

Correcting these weaknesses, he stressed, requires time, careful planning, and strong institutional reforms rather than abrupt or coercive actions.

The Adviser said that despite domestic criticism, Bangladesh's image in the international arena remains largely positive. Development partners and global stakeholders, he noted, generally view the country as having a manageable economy, although they acknowledge that reforming the banking and financial sectors is a difficult but necessary task.

Referring to recent legislative initiatives, he said the government has already taken steps to strengthen the legal framework governing the financial sector.

Amendments to laws related to the Negotiable Instruments Act and the House Building Finance Corporation Act have been passed, while work on strengthening anti-money laundering legislation and improving the effectiveness of financial courts is ongoing.

He pointed out that weak prudential norms, non-compliance with regulations, ineffective supervision, and excessive influence of bank owners over management have been among the key factors behind the sector's fragility.

In many cases, he said, banks were not run according to accepted norms of corporate governance, which undermined transparency and accountability.

Highlighting the role of audits and oversight, the Adviser cited irregularities in audit practices and stressed the need for greater responsibility and professionalism among auditors and regulatory bodies.

He said accountability must be enforced across all institutions to prevent financial misconduct and protect public interest.

On the issue of central bank autonomy, the Adviser said Bangladesh Bank requires adequate operational and administrative independence to perform its duties effectively. However, he emphasised that such autonomy must be balanced with accountability within the sovereign framework of the state.

The Adviser underlined the importance of appointing competent and credible leadership in the banking sector, particularly at the central bank. Transparent and merit-based selection processes, he said, are crucial to ensuring effective supervision and sound policy implementation.

Concluding his remarks, the Adviser said banking sector reform is not optional but a national necessity.

Even if all reforms cannot be completed within the current timeframe, he added that the government is committed to laying a solid foundation so that future administrations can continue the reform process without disruption.

"The banking sector is the backbone of the economy. Strengthening it is essential to protect depositors, maintain financial stability, and support long-term development," he said.

Silver prices vaulted above $100 an ounce on Friday, extending a remarkable 2025 surge into the new year as retail investor and momentum-driven buying added to a prolonged spell of tightness in physical markets for the precious and industrial metal.

Hopping onto the coat-tails of far more expensive gold, technical analysts who study charts of past price moves to predict future movement said the rapid nature of silver's gains had positioned it for a major correction.

"Silver is in the midst of a self-propelled frenzy and with plenty of geopolitical risk to give gold added buoyancy, silver is benefiting, even now, from its lower unit price," said StoneX analyst Rhona O'Connell.

"Everyone, it seems, wants to be involved but it is also flashing amber wealth warnings," she added. "As and when cracks start to appear they could easily become chasms. Buckle up."

Spot prices for silver, used in jewellery, electronics, solar panels, as well as an investment, were last up 5.1% at $101 per troy ounce on Friday.

The price has gained 40% since the beginning of 2026 after rallying by 147% in 2025. Gold hit a record high of $4,988 per ounce on Friday.

BofA strategist Michael Widmer estimates that a fundamentally justified silver price is around $60 with demand from solar panel producers probably having peaked in 2025 and overall industrial demand under pressure from record-high prices.

For the first time in 14 years, it will take just 50 ounces of silver to buy one ounce of gold as of Friday, down from 105 ounces in April.

This ratio, which traders and analysts use as a gauge for future direction, means that silver's outperformance over gold has become stretched.

Investment demand

Silver's gain in 2025 was the largest yearly growth in LSEG data going back to 1983.

The market's performance in 2025 was underpinned by robust investment demand for all precious metals and an extended period of thin liquidity in the benchmark London silver market as worries about US tariffs prompted massive inflows to US stocks.

Several waves of active retail buying through purchases of small bars and coins as well as inflows into physically backed silver exchange-traded funds have added to buying since October, according to analysts.

Almost 20% of a total 1.0-billion-ounce silver supply comes annually from the recycling sector, with activity heightened due to record prices.

However, inventories have not been rebuilding quickly with a shortage of high-grade refining capacity limiting the speed at which silver scrap material can be returned to the market, leading precious metals consultancy Metals Focus said.

The availability of the stocks in the market and secondary supply have become more crucial after five consecutive years of structural deficit, set to persist in 2026.

These deficits, outflows to the US and inflows to the ETFs saw the amount of metal which can be quickly mobilised in periods of high demand in London commercial vaults dwindle to a record low of 136 million ounces by end-September, Metals Focus estimates.

By end-2025, stocks had recovered to nearly 200 million ounces helping to drive down lease rates in London from their October spike, but remained far below the roughly 360 million ounces available in London in the peak of the Reddit-driven rally in early 2021.

What now?

Analysts expect outflows from US stocks to speed up and boost liquidity in the traditional markets as Washington refrained from imposing any tariffs when announcing the results of its critical metals review in mid-January.

After peaking at 532 million ounces on 3 October, COMEX inventories have fallen by 114 million ounces to 418 million ounces, their lowest level since March, as the metal worth about $11 billion left the inventories.

To reach pre-Trump-election levels, COMEX stocks would need to see further outflows of about 113 million ounces, equal to about 11% of total annual silver supply.

"Profit taking following the frenzied nature of the investor-driven rally since late November is likely sooner rather than later, particularly in view of ongoing physical market easing," said BNP Paribas senior commodities strategist David Wilson.

Biman Bangladesh Airlines has suspended two premium long-haul routes within a year, despite one not being loss-making, exposing deep structural weaknesses in fleet planning and route strategy as the national carrier struggles to balance Hajj operations, aircraft shortages and brand credibility.

The most recent decision to suspend the Dhaka-Manchester route from March ahead of Hajj operations comes months after Biman halted the Dhaka-Narita service following heavy losses, indicating a pattern of abrupt long-haul withdrawals that industry experts say reflects deeper flaws in feasibility assessment and long-term fleet planning rather than isolated operational pressures.

At the heart of the disruption is a shrinking and overstretched wide-body fleet, with no new aircraft added in five years, repeated failures to lease additional planes and fresh deliveries from Boeing still at least six years away, forcing the airline to repeatedly reshuffle routes instead of executing a stable network strategy.

Aviation analyst and former Biman Board member Kazi Wahidul Alam said focusing solely on labour-intensive Middle Eastern routes risks weakening the airline's brand.

"Biman is not a budget carrier. Excluding premium routes like Dhaka-Manchester while focusing only on labour routes is not acceptable if the airline wants to maintain a strong image," he told The Business Standard. "To sustain brand value, important international routes must continue."

However, Biman maintains that closing or suspending a route is not a sign of mismanagement but a responsible, safety-driven, and pragmatic operational decision, particularly in the face of severe fleet constraints.

Manchester route suspended amid fleet crisis

Biman has announced that the Dhaka-Manchester-Dhaka route will be temporarily suspended from 1 March 2026 until further notice. The airline cited aircraft shortages, upcoming Hajj operations, long-term maintenance of existing aircraft, and the need to ensure optimal fleet utilisation across its network.

Responding to demands from Sylhet-origin expatriates based in Manchester to keep the route operational, Biman said the Dhaka-London route remains available and can absorb demand, noting that Manchester is about 262 kilometres from London and reachable by train in around two hours.

According to Biman sources, the Manchester route was neither loss-making nor profitable. "However, national interest and Hajj operations require aircraft reallocation during peak periods," a senior official said.

The route has a history of disruption. It was first suspended in 2012 due to aircraft shortages and resumed in early 2020 following long-standing demands from expatriates. The latest suspension – less than five years after resumption – has again raised concerns among passengers.

Biman spokesperson Bosra Islam told TBS that wide-body aircraft such as the Boeing 787 and 777 are used for European, Hajj and Middle Eastern routes. "Manchester is a long-haul destination, and a single aircraft remains tied up for several days. In contrast, the same aircraft can operate multiple Middle Eastern flights within that time," she said.

She added that with a limited fleet, maximising aircraft productivity becomes an operational necessity.

Focus shifts to Middle East routes

Biman says it is prioritising Middle Eastern destinations, where demand from expatriate workers, Umrah pilgrims, transit passengers and cargo movement remains strong. Currently, routes such as Dubai, Jeddah, Riyadh, Doha, Dammam and Muscat are experiencing high passenger loads.

Biman Managing Director Shafikur Rahman recently told the media that expansion in the Middle East remains a key priority due to its importance for remittances, transit traffic and cargo. However, all growth will be phased and tied to fleet availability.

"Our future growth strategy focuses on measured network expansion aligned with market demand and operational capacity," he said. "All new expansion will be introduced in phases, supported by careful fleet planning and commercial viability assessments."

European long-haul operations also require additional pilots, more cabin crew and longer rest periods. During peak Hajj and Umrah seasons, the same crew resources are heavily deployed on Middle Eastern routes, allowing higher flight frequencies and better utilisation.

The next Hajj flight operations are scheduled to begin from 18 April. During the season, thousands of pilgrims must be transported within a limited timeframe, requiring a large number of special flights alongside regular schedules. This pressure often leads to reduced frequencies or suspensions on other routes.

In addition, routine C-checks, engine overhauls and structural inspections can take aircraft out of operation for weeks or months, further tightening fleet availability.

Biman is currently operating 22 international routes with a fleet of 19 aircraft. The airline has failed at least five times in the past two years to lease additional aircraft, and no new aircraft have been added in the last five years.

New aircraft purchases from Boeing are expected only by 2031 – still six years away – leaving the carrier struggling to balance expansion, premium connectivity and operational sustainability amid growing passenger demand.

Narita route: premium service, heavy losses

Biman's Dhaka-Narita route, another premium long-haul service, was suspended in July last year within just 21 months of its resumption due to heavy financial losses.

The national carrier first launched the Narita route in 1979. After multiple suspensions – in 1981 and again in 2006 due to sustained losses – the service was relaunched on 1 September 2023 amid strong public enthusiasm, as it cut travel time to six to seven hours and eliminated long transit stops.

However, Biman sources said each Narita flight incurred losses of nearly Tk95 lakh, with average cabin occupancy at 69%. Total losses on the route stood at Tk215.58 crore, forcing the airline to halt operations and pushing passengers back to third-country transit routes, increasing travel time and costs.

Oil prices settled at their highest in over a week on Friday after US President Donald Trump ratcheted up pressure against Iran through more sanctions on vessels that transport its oil, and announced an armada was heading towards the Middle Eastern nation.

Brent crude futures rose $1.82, or 2.8 percent, to settle at $65.88 a barrel, the highest since January 14. US West Texas Intermediate crude gained $1.71, or 2.9 percent, at $61.07, also a more than one-week high.

Both benchmarks notched weekly gains of over 2.5 percent.

Trump’s statements renewed warnings to Tehran against killing protesters or restarting its nuclear program. The escalating pressure has caused concerns of oil supply disruptions in the Middle East. Kazakhstan has been struggling to resume output from one of the world’s largest oilfields.

Warships, including an aircraft carrier and guided-missile destroyers, will arrive in the Middle East in the coming days, a US official said. The United States conducted strikes on Iran last June.

The US on Friday also imposed sanctions on nine vessels and eight related firms involved in transporting Iranian oil and petroleum products, the US Treasury said in a statement.

At about 3.2 million barrels per day according to Opec figures, Iran is Opec’s fourth-biggest crude oil producer behind Saudi Arabia, Iraq and the United Arab Emirates. It is also a major exporter to China, the world’s second-largest oil consumer.

Chevron said oil output at Kazakhstan’s Tengiz oilfield has yet to resume after Chevron-led operator Tengizchevroil announced a shutdown on Monday following a fire.

The incident exacerbated problems for Kazakhstan’s oil industry, already challenged by bottlenecks at its main exporting gateway on the Black Sea, which has been damaged by Ukrainian drones.

JP Morgan said on Friday that Tengiz, which accounts for nearly half of Kazakhstan’s production, could remain offline for the rest of the month and that Kazakhstan’s crude output is likely to average only 1 million to 1.1 million bpd in January, compared with a usual level of around 1.8 million bpd.

Colombia is suspending electricity sales to Ecuador and will impose a 30 percent tariff on 20 products from its neighbor.

Oil prices climbed earlier in the week on Trump’s moves on Greenland, but dropped by about 2 percent on Thursday as he backed off tariff threats against Europe and ruled out military action.

Trump said on Thursday that Denmark, NATO and the US had reached a deal that would allow “total access” to Greenland.

The government is set to significantly reduce the holding tax on factories located in the Bangladesh Small and Cottage Industries Corporation (Bscic) industrial estates, aiming to ease business operations after Bscic's call for a full tax waiver.

At present, city corporations, municipalities, and union parishads collect holding tax at varying rates. City corporations charge 23% on the assessed annual value of industrial and commercial properties, while municipalities levy 3-7%, and union parishads 1-7%.

According to sources, the holding tax for factories in Bscic industrial estates may now be capped at a maximum of 5% within city corporation areas and 2% at the municipal and union parishad levels – a significant relief for small industries.

Bscic Chairman Md Saiful Islam told The Business Standard on 6 January that Bscic had formally sought a full exemption for all industrial establishments in Bscic estates. "We sent a letter to the Local Government Division requesting exemption from holding tax for industries in Bscic estates," he said.

Following the proposal, the Local Government Division held meetings on 4 December last year with city corporations, municipalities, and union parishads. While a complete waiver was not approved, officials agreed to substantially cut the tax burden.

However, the exact rates are yet to be finalised by the respective local government authorities.

A senior Bscic official, speaking on condition of anonymity, said many industrial units in Bscic estates have not been paying holding tax for years, leading to trade licence suspensions and operational difficulties. "In many areas, factories cannot renew trade licences due to disputes over holding tax, disrupting business and discouraging investment," the official said.

The official also noted that Section 24 of the Bscic Act 2023 allows for exemption of industrial units in Bscic estates from holding tax. He referenced the 2020 exemption of industrial units under Bangladesh Export Processing Zones Authority (Beza) from local taxes and fees, which prompted investors to demand similar treatment.

According to Bscic data, there are 83 industrial estates across the country – 12 within city corporation areas, 27 in municipal areas and 44 in union parishad areas. These estates contain 13,139 industrial plots, of which 11,513 have been allocated to 6,295 industrial enterprises, including 887 fully export-oriented units.

Excluding land and buildings, total investment in these enterprises stands at Tk58,000 crore. In the 2024–25 fiscal year, factories in Bscic estates produced goods worth Tk65,352 crore, with exports accounting for Tk30,947 crore. During the same period, the enterprises paid Tk4,424 crore in taxes and VAT to the government.

However, a senior official of the Local Government Division said holding tax and trade licence fees remain critical revenue sources for local authorities, who also maintain roads, street lighting, and waste management for industrial areas. "While full exemption is not feasible, Bscic industries contribute substantially to employment, production, and exports. The decision is to reduce holding tax as much as possible," the official said.

The impact of non-payment has already been felt in areas such as the tannery industrial zone under Tetuljhora Union Parishad in Hemayetpur, Savar, where trade licence renewals and new licences were blocked due to unpaid holding tax.

The Local Government Division has now instructed all city corporations, municipalities, and union parishads that payment of holding tax will no longer affect the issuance or renewal of trade licences. Any application for a trade licence must be processed in accordance with the rules.

Bscic Chairman Md Saiful Islam hoped that, with this, industries in Bscic estates should no longer face obstacles in obtaining trade licences.

The simmering conflict between Bangladesh's textile mills and garment exporters has exposed a fault line at the heart of the country's export economy—one that policymakers can ill afford to mishandle.

The immediate trigger was a commerce ministry letter asking the National Board of Revenue (NBR) to scrap the zero-duty facility for yarn imports under the bonded warehouse system. The ministry believes duty-free imports have tilted the playing field against local spinning mills and should be suspended to protect domestic producers.

While the NBR has yet to act on the 12 January request, the response from the two industries has been swift—and sharply divided.

Garment exporters have called the proposal "suicidal", warning that removing access to cheaper imported yarn would cripple competitiveness in global markets. Textile millers, on the other hand, see the move as a "lifeline" and have demanded immediate action. The Bangladesh Textile Mills Association (BTMA) has gone a step further, threatening to shut down mills from 1 February if the interim government fails to intervene.

This is not a clash between rival sectors. The two industries are deeply interdependent—and together form the backbone of Bangladesh's export economy.

The labour-intensive apparel sector earned nearly $39 billion last fiscal year, accounting for about 85% of total merchandise exports. The capital-intensive textile sector, with investments of around $23 billion, supplies yarn and fabric to garment factories. Both employ millions, rely heavily on bank financing and are highly exposed to global market shocks.

Trade and tariff analysts warn that a hostile stand-off risks destabilising the wider economy at a time when business confidence is already fragile and investors are waiting for clarity following the 12 February national elections. Supporting one sector at the expense of the other, they caution, could push the entire value chain into a deeper crisis.

How the standoff emerged

Bangladesh once relied heavily on imported yarn and fabric. Over the past three decades, however, large investments have created strong backward linkages, enabling local producers to supply nearly all knitwear demand and around half of woven garments.

That progress has come under pressure in the past two to three years. As imported yarn—mainly from India—has become cheaper, garment exporters have increasingly shifted to imports. Government data show yarn imports doubled in the two years following FY2022–23, with India dominating the supply.

The fallout for local mills has been severe. As garment orders slowed, spinning mills accumulated inventories three to four times higher than normal, while nearly half of installed capacity went idle. The slowdown spread to weaving, dyeing and printing, affecting operations across nearly 2,000 textile units.

After months of appeals from mill owners, the government moved to curb duty-free yarn imports under bond licences. Once the proposal became public, exporters reacted sharply. The BTMA's shutdown threat soon followed, pushing the two sectors into open confrontation.

BTMA argues that continuing zero-duty imports poses an existential threat to local mills. Garment manufacturers' associations—BGMEA and BKMEA—counter that scrapping the bond facility would raise production costs by 8% to 10%, adding more than $2 billion annually to exporters' expenses.

Without duty-free imports, exporters would face additional duties of around 37% on yarn, forcing them to source locally at an extra cost of $0.40–$0.60 per kilogram.

At present, Indian yarn costs about $2.55 per kg, while Bangladeshi mills say they cannot sell below $2.80—and even then struggle to break even. Exporters argue that buyers will not absorb the difference. Millers say the comparison is unfair.

Why local yarn costs more

Bangladeshi spinning mills argue that Indian exporters benefit from extensive government support, allowing them to sell yarn in Bangladesh at prices lower than in India's domestic market—what local producers describe as dumping.

According to industry estimates, Indian incentives provide benefits of nearly $0.30 per kg through export rebates, technology upgrade funds, production-linked incentives and state-level subsidies on power, land and financing.

By contrast, support for Bangladesh's textile sector has steadily declined. Cash incentives for garments made with local yarn have fallen from as high as 25% to just 1.5%. Gas prices jumped by 179% in a single adjustment three years ago. Bank interest rates have climbed to around 16%, while access to low-cost loans under the Export Development Fund has narrowed. Reduced tax rate facilities have also been withdrawn.

Some mills have compounded their problems by over-investing in high-end machinery, increasing debt burdens. The result is a widening competitiveness gap between textile producers in Bangladesh and India.

Is a middle path possible?

Economists argue that while growing dependence on imported yarn carries long-term risks—particularly supply concentration—cutting off access to cheaper inputs abruptly could damage the $40 billion garment export sector.

Professor Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue (CPD), said the government should explore time-bound solutions rather than blunt import restrictions.

These could include limited cash compensation, special loan facilities within LDC rules, anti-dumping investigations, or a quota system that allows duty-free imports up to a certain threshold.

Others suggest reallocating part of the government's 0.3% special cash incentive on garment exports—worth nearly Tk2,000 crore annually—to support the textile sector directly.

Commerce Secretary Mahbubur Rahman acknowledged the dilemma, saying the government is examining alternatives.

"The textile industry is facing problems, no doubt. Something has to be done," he told The Business Standard. "We are thinking about what options are possible."

"There are ways. There could be a mix— imposing restrictions at places and relaxing steps at other places, so that all sectors are treated how they should be," said Muhammad Abdul Mazid, former chairman of NBR.

"They should not be seen as two mere industries, they are a vital part of the economy. There must be a holistic approach to balance the tariff issues," he said. While NBR can reassess the impact on withdrawal of bond facilities from certain industries, the commerce ministry has to align tariff structure to the country's key trade partners, he said, suggesting all parties involved to sit together to find solutions.

Cash incentives, subsidies, loans and weighing on options such as anti-dumping duty are among other measures suggested to support the industry which is deemed to be affected by changes in import tariff structure.

The challenge now is to act quickly—and carefully. A misstep could fracture a value chain that took decades to build, at a time when Bangladesh can least afford another economic shock.

The main reason for restoring the lottery system in primary share allocation is to boost turnover in the secondary market against the backdrop of a persistent investor exodus.

The IPO lottery system was removed in April 2021 after it was repeatedly accused of depriving retail investors of IPO shares. The Bangladesh Securities and Exchange Commission (BSEC) replaced it with the pro-rata allotment system, which enabled share allocation to every valid applicant in proportion to the quantities applied for.

"We have observed that IPO shares were mostly exhausted by high net worth individuals [under the pro-rata system]. They have more money. They applied for more shares and they got more," said BSEC spokesperson Abul Kalam.

According to the market watchdog, the very objective behind removing the lottery system could not be achieved. Instead, enthusiasm surrounding new listings faded as retail investors received only nominal numbers of shares.

The BSEC brought back the lottery system even though the taskforce assigned to suggest capital market reforms made no recommendation on IPO share distribution.

"Out of 200 public opinions that we received [on the revised rules], 171 voted for the lottery system," said Kalam.

"We did not recommend bringing back the lottery system in IPO," said Md Moniruzzaman, managing director and CEO of Prime Bank Securities Ltd, adding that IPO hunters might have pushed for the return of the system.

"They might have given votes in the public opinion. It is true the lottery system encouraged participation with the hope for higher profits," said Moniruzzaman, who was in a focus group responsible for assisting the taskforce.

Under the pro-rata system, the IPO share pool was divided into different investor categories with predefined quotas for each.

The main categories were general investors (including retail and local individuals), non-resident Bangladeshis (NRBs), and eligible investors (institutional or qualified investors). The total number of shares allocated to each category was fixed as a proportion of the IPO size.

That meant if the eligible or institutional portion was oversubscribed, each applicant in this segment received shares in proportion to the amount applied for.

"The pro-rata system prefers big investors," said Kalam.

Another reason for removing the lottery system earlier was to curb investors' speculative behaviour.

The lottery-based IPO process encouraged short-term speculation, with investors applying mainly to gain quick listing profits rather than long-term investment returns.

However, the BSEC took into consideration the steep decline in the number of BO accounts since the repeal of the lottery system.

"There were nearly 3 million BO accounts in the market when the lottery system was in place. Now it has fallen to 1.6 million. Market turnover has also declined. We believe the reintroduction of the lottery system will bring back the festive mood [around listings] and increase turnover," said the BSEC spokesperson.

When retail investors make profits from IPO shares, they reinvest a portion of those profits in the secondary market, Kalam added.

Lottery-driven IPOs used to witness excessive oversubscription-sometimes hundreds of times the required amount-creating operational and settlement pressure in the IPO process.

According to Kalam, this will not happen now as BO account opening has become more tightly regulated. Investors must have a bank account and a bank certificate in their own name before opening a BO account. Opening a bank account requires a national ID card.

"Fake accounts can no longer be used to apply for IPO shares," said the BSEC spokesperson.

The regulator has also eliminated, under the revised IPO rules, the minimum requirement of Tk 50,000 investment in the secondary market for each BO account.

"We have brought back the lottery system to ensure more shares for general investors. We believe this will increase investor participation in the market," Kalam added.