Bank deposit growth in Bangladesh reached its highest level in 20 months, standing at 10.80% at the end of November 2025, driven largely by a strong surge in remittance inflows, even as the domestic economy remained subdued.

According to data released by the Bangladesh Bank today (11 January), the total volume of bank deposits stood at Tk19.53 lakh crore at the end of November 2025, up from Tk17.62 lakh crore in November 2024.

The previous month's growth, recorded at the end of October, was 9.62%, while the last time growth exceeded 10% was in February 2024, when it stood at 10.43%.

Remittance flows as key driver

Economists and bankers largely attribute the strong growth to the robust inflow of remittances.

Zahid Hussain, former lead economist at the World Bank's Dhaka office, told TBS that the remittance flow contributed the most to the deposit growth, noting that flows were "very good" during November and December. He explained that dollars arriving through the banking channel are converted into taka, which then comes into the banking sector.

"The domestic economy is still depressed, so the growth is not coming from there," Zahid said. "Savings increase when domestic income and remittances rise. Remittances increased in the last two months of 2025, but no signs of increasing domestic income were visible."

He also discounted the idea that reduced panic in the banking sector – despite central bank confidence-building measures – was the primary cause, noting that the "currency outside banks" figure shows little change.

Cenbank's dollar purchase aids liquidity

The increase in remittances, which stood at $2.88 billion in November 2025, has positively impacted the commercial banks' Net Open Position. This has led banks to sell their excess dollars to the central bank, resulting in taka flowing from the central bank into the commercial banking system. The Bangladesh Bank has purchased $3.75 billion from commercial banks so far in the current fiscal year.

Md Ahsan-uz Zaman, managing director of Midland Bank, confirmed this view, saying, "The Bangladesh Bank is buying dollars through auction, increasing market liquidity. This influx of funds is helping to boost bank deposits." He also mentioned that some deposits were accumulated due to the formation of a collective Islamic bank.

A private bank's head of treasury noted that deposit growth correlates directly with the remittance flow, stressing that the domestic income situation is currently "not very good."

Data analysis shows that within the first 11 months of 2025, only August and November recorded double-digit bank deposit growth.

Currency outside banking system declines

Adding to the positive trend, Bangladesh Bank data shows that the volume of currency held outside banks fell by 3.04% year-on-year in November 2025 to Tk2.69 lakh crore, compared to Tk2.77 lakh crore in the same month of 2024.

A senior central bank official suggested that money held outside banks is gradually returning to the formal financial system.

Bangladesh government has halted the import of onions from India through the country's largest land port, Benapole, for the past two weeks, raising concern about a price hike.

Importers, however, can continue bringing in onions under previously issued permits until 30 January.

Officials did not grant any new permits for onion imports from India on Saturday.

Shyamal Kumar Nath, Assistant Plant Quarantine Officer at Benapole, confirmed that onion imports from India have been halted for the past two weeks and no new permissions have been issued.

Onions can still be imported under previously issued permits until 30 January, he added.

Since 24 December, no onion shipments have entered through Benapole. The last consignment of 60 tonnes arrived on that date, while 390 tonnes were imported between 15 and 24 December through six consignments carried in 13 trucks.

Royal Islam, an onion importer, said the government usually allows onion imports when local prices rise sharply.

Imports of onion were resumed on 7 December after a three-month halt, initially in limited quantities, which did not meet demand. Later, when import permissions increased, prices began to stabilise, falling to Tk35–40 per kilogram.

Since imports have now been suspended again, prices are rising to Tk50–70 per kilogram, he said.

"If the halt continues, prices could climb to Tk80–85. Even the news of the suspension has already pushed prices up by Tk10 per kilogram at the port," he added.

Because of the harsh environment in Greenland, lack of key infrastructure and difficult geology have so far prevented anyone from building a mine to extract the sought-after rare earth elements that many high-tech products require. Besides President Donald Trump prevails in his effort to take control of the arctic island, those challenges won't go away.

Trump has made reducing China's dominance over the global rare earth supply a top priority since the world's second-largest economy sharply limited access to those materials after the United States imposed broad tariffs last spring. His administration has poured hundreds of millions of dollars into the sector and has even acquired stakes in several companies. Now, the president is suggesting that taking control of Greenland from Denmark could be the answer.

"We are going to do something in Greenland whether they like it or not," Trump said Friday.

Greenland is unlikely to produce rare earths anytime soon, if at all. Although some companies are exploring its estimated 1.5 million tons of deposits, most projects remain at an early stage. Trump's interest in the island may be driven more by efforts to counter Russian and Chinese influence in the Arctic than by access to rare earths like neodymium and terbium used in advanced technologies.

"The fixation on Greenland has always been more about geopolitical posturing — a military-strategic interest and stock-promotion narrative — than a realistic supply solution for the tech sector," said Tracy Hughes, founder and executive director of the Critical Minerals Institute. "The hype far outstrips the hard science and economics behind these critical minerals."

Trump confirmed those geopolitical concerns at the White House Friday.

"We don't want Russia or China going to Greenland, which if we don't take Greenland, you can have Russia or China as your next-door neighbour. That's not going to happen," Trump said.

A difficult place to build a mine

Mining in Greenland faces major hurdles, including extreme remoteness, limited infrastructure, environmental risks, and harsh weather. Rare earths there are locked in complex eudialyte rock with no proven profitable extraction method. While Critical Metals' shares jumped after plans for a pilot plant, it and other companies remain far from building a mine and would need massive investment.

Producing rare earths is a tough business

Even the most promising rare earth projects can struggle to be profitable, especially when China floods the market with excess supply to lower prices and push competitors out, a tactic it has used repeatedly. Currently, most critical minerals are still processed in China.

The US is rushing to increase rare earth supplies outside China during a one-year easing of stricter restrictions that Trump said Xi Jinping agreed to in October. Several companies worldwide are already producing rare earths or magnets and can bring them to market faster than Greenland, which Trump has threatened to take militarily if Denmark refuses to sell it.

"There are very few folks that can rely on a track record for delivering anything in each of these instances, and that obviously should be where we start, and especially in my view if you're the U.S. government," said Dunn, whose company is already producing more than 2,000 metric tons of magnets each year at a plant in Texas from elements it gets outside of China.

The Bangladesh Bank (BB) has set a target to reduce non-performing loans (NPLs) to 25 percent from the current 36 percent by March, according to senior bankers.

In a meeting held at BB headquarters yesterday, banks were instructed to cut the volume of bad debts through loan rescheduling, accelerating legal recovery and implementing a comprehensive follow-up process for defaulters.

A delegation from the Association of Bankers, Bangladesh (ABB), led by its Chairman Mashrur Arefin, attended the meeting. It was chaired by BB Governor Ahsan H Mansur, with deputy governors, executive directors, and other senior officials of the central bank also present. Nazma Mobarek, secretary of the Financial Institutions Division, attended as well.

The meeting included a presentation on monetary policy and the country’s broader economic situation.

Central bank officials said the governor expressed dissatisfaction with banks’ efforts to tackle defaulted loans, despite various initiatives by the government and the central bank.

Defaulted loans in the banking sector rose to Tk 6.44 lakh crore, nearly 36 percent of total loans disbursed, by the end of September 2025, according to BB data.

In September 2024, the ratio of bad loans stood at 16.93 percent of total outstanding loans. It means that the share of NPLs had roughly doubled within a year.

This is the highest level since 2000, exposing vulnerabilities in the banking system and raising concerns about financial governance.

Under the central bank’s policy support, around 300 companies, including some of the largest defaulting conglomerates, applied for loan rescheduling or restructuring facilities worth around Tk 2 lakh crore during the first nine months of 2025.

In January last year, the BB formed a five-member committee, led by the executive director of the Department of Offsite Supervision, to provide policy guidance for restructuring or rescheduling corporate loans affected by circumstances beyond borrowers’ control.

The committee completed its tripartite meetings with borrowing companies and their financing banks on September 30.

Sources present at yesterday’s meeting said about 44 percent of the approved policy support has been implemented so far, with Islami Bank Bangladesh and United Commercial Bank performing at satisfactory levels.

Bankers expressed optimism that they would be able to reduce bad loans by March.

Speaking on condition of anonymity, a chief executive of a private commercial bank told The Daily Star that the meeting also discussed the foreign exchange market, noting that banks currently hold adequate foreign currency reserves.

“The BB governor asked banks to ensure smooth letter-of-credit payments ahead of Ramadan to maintain the food supply chain,” he said.

The CEO added that the central bank has injected around Tk 40,000 crore in local currency against its purchase of $3.50 billion over recent months.

At the meeting, bankers urged the BB to liberalise the inflow and outflow of foreign currency. The central bank asked the commercial lenders to make sukuk bonds tradable ahead of a planned government issuance of Tk 10,000 crore in sukuk bonds, according to sources.

During the meeting, the central bank instructed banks to run campaigns for the upcoming referendum at their head offices and branches.

The secretary of the Financial Institutions Division asked banks to carry out positive campaigns to raise public awareness about the referendum and encourage voter participation. Many banks have already begun outreach efforts at their branches.

The national election and the referendum on the July Charter are scheduled for the same day, 12 February. The interim government has already started campaigning for the referendum.

Vietnam and Japan crossed a major commercial milestone last year as two-way trade turnover exceeded US$50 billion for the first time, underscoring the strength and momentum of bilateral economic ties.

The achievement also reaffirmed Japan’s position as one of Vietnam’s largest and most stable trading partners at a time of continued volatility in the global economy.

The Vietnam Trade Office in Japan reported that bilateral trade delivered positive results throughout the year. Citing statistics from the Department of Customs, total import-export turnover between the two countries reached more than $51.43 billion, an increase of 11.28 percent compared to 2024.

Vietnam’s exports to Japan amounted to $26.77 billion, up 8.77 percent, while imports from Japan reached $24.68 billion, a year-on-year rise of 14.13 percent. As a result, Vietnam recorded a trade surplus of $2.09 billion with Japan last year.

Key Vietnamese export groups to Japan include textiles and garments; transport vehicles and spare parts; machinery, equipment, tools and other spare parts; wood and wood products; mobile phones and components; computers, electronic products and components; footwear; seafood; coffee; fruits and vegetables; cashew nuts and pepper.

Meanwhile, Vietnam imports a wide range of products from Japan, notably computers, electronic products and components; machinery, equipment, tools and spare parts; iron and steel products; fabrics; automobile components and spare parts; and seafood.

Notably, the two largest import categories – computers and electronic components, and machinery and equipment – together accounted for nearly 54 percent of Vietnam’s total import value from Japan.

The structure of Vietnam-Japan trade in 2025 remained highly complementary, reflecting the respective strengths of both economies and their deep integration into global supply chains.

Tạ Đức Minh, commercial counsellor of the Vietnam Trade Office in Japan, said the $50 billion milestone was not only historically significant but also reflected the substantive and sustainable growth of economic cooperation between the two countries amid ongoing global economic uncertainty. He added that these positive outcomes were closely linked to the strategic guidance of Vietnam’s Ministry of Industry and Trade in promoting bilateral economic and trade relations.

The ministry has laid an important foundation enabling businesses in both countries to expand cooperation and integrate more deeply into regional and global value chains, Minh said.

This progress has been driven by the negotiation and effective implementation of free trade agreements, including the Vietnam-Japan Economic Partnership Agreement, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership, alongside policies helping enterprises take advantage of tariff preferences and guidance on developing key export sectors.

To sustain and accelerate growth in bilateral trade, Minh said the trade office would proactively monitor and analyse developments that could affect trade between Japan and Vietnam this year, promptly advising the Government and ministry leaders on policy responses and issuing early warnings to the business community.

Efforts will also continue to intensify trade promotion, diversify export products for the Japanese market, expand market development activities in Japan and invite Japanese business delegations to take part in domestic trade promotion programmes.

In addition, the trade office will support enterprises in boosting competitiveness by providing market information, updating technical standards and import regulations, and assisting Vietnamese companies with brand building and product marketing in Japan, including identifying reputable distribution partners and connecting with suitable retail channels.

The Vietnam Trade Office in Japan has served as a direct and effective bridge between businesses of the two countries. In 2025, it coordinated and supported Vietnamese enterprises in participating in major trade and investment promotion events, including Foodex Japan 2025, the M-Tech Manufacturing Expo, Gift Show, DIY Show, fashion and textile exhibitions, building and decoration fairs, as well as Vietnam festivals in Tokyo and Kanagawa.

The office also hosted Japanese business delegations in Vietnam for trade fairs and market surveys, connecting companies across key sectors. These efforts helped boost trade and strengthen market knowledge, technical standards, and long-term cooperation.

With the support of the MoIT, the direct assistance of the Vietnam Trade Office in Japan, and the proactive efforts of the business community, the Vietnam-Japan trade and investment cooperation is expected to grow strongly in the time to come.

Last week's much-hyped meeting on the listing of state-run and multinational companies delivered little beyond a renewed reminder of the government's intent to their top management.

Despite Finance Adviser Dr Salehuddin Ahmed's claim that 10 companies had agreed to offload shares, meeting participants told The FE in recent telephone conversations that the representatives had only committed to placing the matter before their boards.

Dr Ahmed on Wednesday held a meeting at the Bangladesh Secretariat with three advisers and top officials of targeted state-run and multinational companies, including Unilever Bangladesh, to press the issue.

"But no procedural progress could be achieved at the meeting," said one participant, requesting anonymity.

The FE spoke to three meeting participants, whose accounts corroborated each other regarding the outcome.

Some participants defended their non-listed status, while others openly argued against listing.

A representative of Unilever Bangladesh told the meeting that its subsidiary, Unilever Consumer Care, had already been listed on the bourses and that this fulfilled the obligation to share profits with the public.

However, Unilever Consumer Care was listed when it was GSK Bangladesh. Unilever acquired the company later on in June 2020.

Sources said the finance adviser rebuked companies that expressed reluctance to issue primary shares in the secondary market.

He reminded the representatives that it was the government's decision to offload its own stakes in multinational companies.

"Then why would you not offload your shares?" the finance adviser asked.

He told the Unilever representative that the company must offload shares alongside the government's stake.

According to meeting sources, the adviser said the government had already decided to offload its 5 per cent stake and that the company would have to offload another 5 per cent.

The chairman of the state-run Investment Corporation of Bangladesh (ICB), Prof Abu Ahmed, told the meeting that the government should widen the tax differential between listed and non-listed companies to compel state-owned enterprises and multinational firms to enter the equity market.

He added that companies in the UK are required to offload at least 10 per cent of their paid-up capital, whereas the Bangladesh government was pressing for only a 5 per cent offloading.

Multinational companies, Prof Ahmed said, are sharing profits with the public in other countries. "Then why are they not doing it here?" he asked.

The interim government announced in May last year a plan to bring more companies to the secondary market to improve its depth.

So far, no visible progress has been made in executing the plan, and Wednesday's meeting also failed to move the process forward.

Asked about the meeting outcome, Prof Ahmed told The FE that it was a high-profile meeting attended by four advisers, bureaucrats and top officials of the targeted companies.

"A strong message was delivered, but we cannot speak about execution yet," he said. Two other participants also expressed dissatisfaction over the lack of progress in implementing the government's listing decision.

At Wednesday's meeting, a representative of Nestlé Bangladesh said the government held no stake in the company.

In response, the finance adviser said it did not matter whether the government had a stake and that the company would still have to go public.

The meeting also raised complications regarding the listing of Karnaphuli Fertiliser Company Ltd (KAFCO).

The company's regulations allow shareholders to transfer their shares to existing shareholders. A foreign shareholder is reportedly planning to transfer its stake, which the government could initially receive and later offload in the market.

Another participant, speaking on condition of anonymity, said that while the finance adviser strongly emphasised the need to list multinational companies, the commerce adviser later softened the tone.

Ultimately, representatives of state-run and multinational companies concluded the meeting by saying they would seek board approval for listing after placing the meeting minutes before their boards.

Auditors have expressed serious concern over the financial position of Altex Industries Limited, a company listed on the stock exchange, for the fiscal year 2024-25, citing massive debt discrepancies and an inability to meet loan obligations.

As of 30 June 2025, the company's retained earnings were negative, amounting to Tk86.24 crore.

The company failed to repay scheduled loan instalments, and Tk3.07 crore of loans have been classified as "bad and loss," remaining unpaid for a prolonged period.

The company has been unable to arrange funds to settle these loans, raising significant uncertainty over its ability to continue as a going concern.
The share price of the company closed at Tk13.50 on the Dhaka Stock Exchange (DSE) yesterday.

In the case of Prime Bank, bank confirmation indicates that the company's actual loan liability was Tk94.56 crore, while the company's books reported only Tk17.20 crore.

No provision of Tk68.27 lakh for interest was made, resulting in an overstatement of profit before tax and an understatement of bank loan liability.

For Sonali Bank, the company's loan stood at Tk227.52 crore, but interest of approximately Tk22.75 crore was not charged, causing loan liabilities to be understated and profit before tax to be overstated.

Similarly, for ONE Bank, the absence of interest provisions led to an understatement of loan liability by Tk1.56 crore.

Auditors also noted that although the company collected Tk32.51 crore from accounts receivable during the fiscal year, approximately 64% of collections were made in cash, posing a significant operational risk.

Additionally, the company paid Tk5.25 crore in advance to Cube Development Limited for factory construction, and a contingent liability of Tk6.93 crore with Titas Gas remains unsettled. Interest income of Tk1,034,674 from fixed deposits has been recorded as financial expenses, which is inconsistent with accounting standards.

The company's primary raw material is grey fabric, yet its usage rate relative to total sales is only 21%, which appears unusual. During the fiscal year, the company made no export sales, with all sales restricted to the domestic market. Furthermore, approximately 69% of the company's total funds are debt-dependent, increasing financial expenses and raising concerns about its financial stability.

According to the auditors, these circumstances create significant uncertainty regarding the company's ability to continue as a going concern. They emphasised the urgent need for proper loan management, interest provisioning, cash transaction control, and resolution of contingent liabilities.

In December 2024, Sonali Bank decided to sell the mortgaged assets of Alltex Industries through an auction to recover the outstanding loans of the listed textile manufacturer.

To recover the funds, the bank plans to auction 14.7 acres of Alltex's land, its manufacturing facilities and offices, raw materials, and spare parts, all of which were mortgaged for the loan.

The Dhaka Stock Exchange (DSE) suffered a sharp setback on Sunday as heavy selling in banking stocks dragged the key index lower, reversing recent gains and dampening investor sentiment at the start of the trading week.

The downturn was broad-based, with all major large-cap sectors closing in the red, but losses in banks played the most decisive role in pulling the market down.

The benchmark DSEX index fell by 58 points, or 1.17%, to settle at 4,939, while the blue-chip DS30 index dropped 18 points, or 0.97%, to close at 1,896.

Market breadth was heavily skewed toward decliners, with 313 stocks ending lower against just 38 advancers, as selling pressure intensified across the board.

Turnover also slipped to Tk412 crore, reflecting cautious trading activity, while overall market capitalisation shrank by around Tk2,000 crore in a single session.

Banking stocks were at the centre of the sell-off, with the sector shedding 1.77% on the day.

Market participants said the decline was largely driven by short-term investors locking in profits after a strong rally in recent weeks.

Over the past three weeks, the banking sector's market capitalisation had surged by nearly 8%, or about Tk5,000 crore, raising concerns of overbought conditions. As profit-taking set in, most banking shares came under pressure, erasing a portion of those gains.

Out of the 36 banks listed on the DSE, share prices of 27 lenders declined, while the remaining nine ended the session unchanged. The selling spree in banks weighed heavily on overall market sentiment, given the sector's significant weight in the indices and its role as a bellwether for the broader market.

Market analysts said the near-term direction of the market will largely depend on whether banking stocks stabilise after the recent correction. While fundamentals of some large banks remain relatively strong, investors are likely to stay cautious in the coming sessions, closely watching sector-specific developments and broader economic signals before rebuilding positions.

Losses were not limited to banks. Non-bank financial institutions experienced the steepest sectoral decline, dropping 1.95%, amid lingering concerns over asset quality, regulatory actions and the financial health of weaker players.

Engineering stocks fell 1.16%, while telecommunications declined 0.93% and pharmaceuticals slid 0.91%. Fuel and power shares lost 0.66%, and food and allied industries slipped 0.36%, highlighting the extent of the market-wide pullback.

Trading activity was concentrated in a handful of stocks, with Orion Infusion, Dominage Steel, City Bank, Square Pharmaceuticals and Uttara Bank emerging as the top turnover leaders.

Despite the weak overall market, a few stocks managed to post gains. First Finance topped the gainers' list, while Shinepukur Ceramics, Familytex BD, Zaheen Spinning and Union Capital also closed higher.

On the flip side, several troubled non-bank financial institutions, already under liquidation threat, dominated the list of top losers. Shares of Fareast Finance and International Leasing suffered steep declines, reflecting heightened investor anxiety following recent regulatory signals and concerns over the future of non-viable institutions.

The bearish mood extended to the Chittagong Stock Exchange (CSE) as well. The CSCX index fell by 73 points, or 0.84%, to 8,579, while the CASPI index dropped 116 points, or 0.83%, to close at 13,877. Turnover at the port city bourse plunged sharply to Tk4.03 crore, underscoring the subdued trading environment.

There has been no improvement in Bangladesh's food supply system in the first half of FY2025–26, the Centre for Policy Dialogue (CPD) said today (10 January), warning that structural weaknesses continue to keep prices elevated despite easing global trends.

The assessment was presented by Executive Director Fahmida Khatun during CPD's independent review of the state of the economy at a press conference in Dhaka.

CPD said weaknesses in storage, distribution and market competition remain unresolved, contributing to persistently high food prices.

Inflation stood at 8.49% in December. While food inflation has declined slightly, non-food inflation remains high, putting pressure on households.

The organisation questioned why domestic food prices have not fallen in line with global trends.

It noted that global prices of key commodities such as sugar and edible oil fell by around 40% in November, but Bangladesh has not seen a similar reduction.

CPD pointed out discrepancies in the domestic market, saying the country produces more rice than its estimated demand.

Annual demand stands at 41 million tonnes while production is 44 million tonnes. However, prices remain high, partly due to weaknesses in supply management.

It said profit margins are highest in perishable items such as green chillies, brinjal, beef, and fish, where middlemen have greater control over the supply chain.

In contrast, price variation in rice is lower.

The organisation also noted a decline in agricultural labourers' wages, even as food prices continue to rise.

On policy recommendations, CPD stressed that inflation cannot be reduced merely through higher market interest rates.

It said increasing supply, preventing hoarding and enhancing market competition are necessary to stabilise prices.

The organisation called for an integrated food policy framework to ensure effective imports, maintain adequate food stock, and streamline supply and transport systems.

It also stressed the need to ensure the timely supply of quality seeds and fertilisers to boost Aush and Aman production.

The government is weighing a range of policy options – including tighter import controls, curbs on duty-free yarn imports and incentives to encourage the use of locally produced yarn – as it comes under growing pressure to protect domestic spinning mills from a surge in imported yarn, particularly subsidised supplies from India.

Officials from the Bangladesh Trade and Tariff Commission (BTTC) met representatives of the Bangladesh Textile Mills Association (BTMA) and the country's two garment exporter bodies in Dhaka on Wednesday. While participants broadly agreed on the need to safeguard the textile value chain, no decision was reached amid sharp differences between mill owners and garment exporters.

"We are studying the issue and working on it," Commerce Secretary Mahbubur Rahman told The Business Standard when asked whether the government was considering import restrictions to protect local textile industries.

Bangladesh's ready-made garment (RMG) sector, the world's second-largest exporter, has developed significant backward linkages over the years. Local textile mills now meet about 60% of the demand for woven fabrics and almost the entire yarn requirement of the knitwear sector. Despite this, spinning mills have been under severe financial stress for more than a year, often selling yarn below production cost to remain competitive.

Mill owners say unsold yarn worth more than $1 billion is currently piled up across factories. The BTMA recently urged urgent government intervention, warning that an industry which has attracted investments of around $23 billion is at risk.

According to BTMA data, Bangladesh imported yarn worth about $2.20 billion in 2024, of which roughly 76%, around $1.64 billion, came from India. Spinners argue that Indian exporters benefit from subsidies provided by both the central and state governments, estimated at about $0.30 per kilogram of yarn, enabling them to undercut domestic producers.

A senior BTTC official who attended Wednesday's meeting, speaking on condition of anonymity, said all parties recognised the need to protect the textile sector, but competing interests prevented a consensus.

"Before taking any decision on import restrictions or other measures, we need a deeper assessment of WTO rules, revenue implications and the legal aspects," the official said.

Industry insiders said the meeting discussed the possibility of suspending yarn imports or imposing additional duties on 10 to 30 count yarns for one year. These categories account for nearly 95% of Bangladesh's total yarn imports.

BTMA Director Masud Rana proposed a 7% incentive for exporters using locally produced yarn, a suggestion supported by representatives from the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA). However, two other BTMA representatives called for a complete withdrawal of duty-free yarn imports under the bonded warehouse facility.

A BKMEA leader present at the meeting said data presented there showed yarn imports had declined over the past six months compared to the same period a year earlier.

Garment exporters push back

Garment exporters, however, strongly opposed any move to restrict imports.

Fazlee Shamim Ehsan, executive president of BKMEA, said exporters were already operating under intense cost pressure. "About 80% of exporters are selling below production cost," he said. "If yarn imports are restricted, costs will rise further and buyers may shift orders to countries like India, where prices are lower."

While acknowledging the need to support the textile sector, Ehsan argued that import restrictions were not the right solution. "The government could instead provide special incentives or other forms of support to spinners," he said.

BGMEA leaders echoed similar concerns, questioning whether international buyers would be willing to absorb higher costs if local yarn prices exceeded imported alternatives.

Textile mill owners, however, warned that continued inflows of low-priced yarn could permanently erode domestic capacity. Former BTMA vice-president Salehuddin Zaman Khan described Indian yarn shipments as a form of dumping. "If local mills shut down, garment manufacturers will eventually be forced to import yarn at higher prices," he said.

BTMA Director Khorshed Alam said even vertically integrated manufacturers were unable to rely on their own production. "A representative from RN Spinning told the Tariff Commission that he was forced to import yarn because he could not match imported prices even for use in his own garments factory," Alam said. "The benefit of cheaper yarn is ultimately captured by buyers, not local producers."

BTMA President Showkat Aziz Russell has said nearly 100 textile mills have already shut down fully or partially, adding that he himself was forced to close one of his factories.

Bond misuse allegations resurface

Garment exporters also questioned whether import restrictions would achieve their intended objective. Ehsan warned that buyers might instead nominate Bangladeshi exporters to import grey fabric from India, offsetting any gains from restricting yarn imports.

Meanwhile, mill owners renewed allegations of widespread misuse of the bonded warehouse facility, which allows exporters to import raw materials duty-free on the condition that they are not sold domestically.

Khorshed Alam estimated that textile goods worth around $5 billion enter the local market annually through bond misuse and smuggling. "The local apparel market is worth about $12 billion, of which domestic producers supply only $7 billion," he said. "The remaining $5 billion is largely met through duty-free imports diverted into the local market."

He added that falling yarn prices have inflicted heavy losses on mills and reduced government revenue. "The price of 53-count yarn has fallen by Tk60 per kilogram since February, causing a net loss of Tk41 per kilogram," he said. "In November alone, one mill recorded losses of Tk1.8 crore."

VAT receipts have also declined, he said. "The mill paid Tk15 lakh in VAT in October, which fell to Tk8 lakh in November as sales dropped."

Lowering interest rates is not a matter of a single decision, as it risks disrupting the overall economic balance, Finance Adviser Salehuddin Ahmed said today.

Cutting interest rates without proper coordination among treasury bills, the banking sector, and market mechanisms could have adverse effects on the broader economy, he said at an event in Dhaka.

The adviser noted that interest rates are often discussed as if there were simple solutions, but in reality, reducing rates on one front can create pressure elsewhere in the economy.

Referring to the recent decline in treasury bill yields, Ahmed said its impact would gradually be reflected in the market.

However, if interest rates on treasury bills or savings instruments are increased, deposits in banks would fall, posing risks to the banking system.

The adviser said the core function of the banking sector is to build a bridge between savings and lending.

“Banks and non-bank financial institutions play this intermediary role, and any weakness in this structure negatively affects the entire economic system,” he said.

He was speaking at the publication ceremony of the Banking Almanac at the Centre on Integrated Rural Development for Asia and the Pacific in Dhaka.

Although the Banking Almanac does not provide direct investment guidance, it is an important data source for analysing the banking sector, Ahmed said.

The publication includes key information such as paid-up capital, authorised capital, capital ratios, provisioning, retained earnings, and credit-deposit ratios.

Discussing the current state of the banking sector, the adviser said the situation was critical when he assumed office. However, recent data analysis indicates signs of positive change in provisioning and lending activities at some banks, which are reflected in the Banking Almanac.

On inflation, he said it cannot be controlled through monetary policy alone, adding that sustainable solutions require supply-side management, market supervision, and cooperation from both businesses and consumers.

The adviser urged journalists not to portray Bangladesh solely in a negative light but to highlight positive developments alongside constructive criticism, as the country has made notable progress despite many constraints.

Bangladesh's economy is expected to grow 4.6% in the current fiscal year (FY26), up from an estimated 4.1% a year earlier, before rising further to 5.4% in FY27, according to a United Nations report.

But the projected growth still remains short of pre-pandemic levels.

Released on Thursday (8 January), the UN Department of Economic and Social Affairs report titled "World Economic Situation and Prospects 2026" also anticipated some relief on prices, with inflation expected to ease to 7.1% in FY26 and further to 6% next fiscal year.

Inflation, however, has remained elevated so far in the current fiscal year, staying above 8% over the past six months.

The forecast further predicts a rise in Bangladesh's GDP in FY26, aligning with positive growth projections from the Asian Development Bank, World Bank, and International Monetary Fund.

The Asian Development Bank, in its September 2025 outlook, projected Bangladesh's GDP growth at 5% in FY26. In October last year, the World Bank forecast growth of 4.8% in FY26, rising to 6.3% in FY27.

Around the same time, the International Monetary Fund projected growth of 4.9% for FY26 and 5.7% for the following fiscal year.

However, the interim government has set a higher GDP growth target of 5.5% for FY26, exceeding the projections made by international agencies.

South Asia to remain resilient

According to the UN report, economic growth in South Asia is expected to remain relatively strong, though slightly moderating in the near term. Regional growth is projected to ease from an estimated 5.9% in 2025 to 5.6% in 2026, before recovering to 5.9% in 2027. Trade policy uncertainty and high public debt were cited as continuing constraints for several economies.

India's economy is estimated to have grown by 7.4% in 2025 and is forecast to expand by 6.6% in 2026 and 6.7% in 2027, supported by resilient private consumption and strong public investment, which are expected to offset the impact of higher United States tariffs on exports.

Bhutan is projected to maintain growth above 6% in the near term, driven by strong government spending and the ongoing recovery of agriculture and tourism. Growth in the Maldives and Sri Lanka is forecast to moderate to around 4.3% and 4.0% respectively in 2026.

Pakistan's economy is expected to grow by 3.5% in FY26, up from an estimated 3.1% in FY25, while Nepal's growth is forecast to ease slightly to 4.3% in FY26 from an estimated 4.4% the previous year.

Global growth to remain subdued

At the global level, the UN projects economic growth to slow to 2.7% in 2026 before edging up to 2.9% in 2027, still below the pre-pandemic average of 3.2% recorded between 2010 and 2019.

The report noted that a sharp increase in United States tariffs had "created new trade frictions", although the lack of broader escalation had helped limit immediate disruption to international trade.

"A combination of economic, geopolitical and technological tensions is reshaping the global landscape, generating new economic uncertainty and social vulnerabilities," UN Secretary-General António Guterres said.

He added, "Many developing economies continue to struggle and, as a result, progress towards the Sustainable Development Goals remains distant for much of the world."

The country's revenue collection has grown by 16.7% in the first six months of the current fiscal year, Centre for Police Dialogue (CPD) said today (10 January), but warned that achieving the annual target will be challenging.

The observation came during CPD's independent review of the state of the Bangladesh economy for the first half of FY2025-26. CPD Executive Director Fahmida Khatun presented the assessment at a press conference at the organisation's office in Dhaka.

The review covered seven areas, including public expenditure, the inflationary trend, food security and private investment.

CPD noted that the new government will need to give priority to each of these sectors following the upcoming election next month.

On the public financial system, CPD said both revenue mobilisation and expenditure management are critical areas that will need attention.

It also observed that the interim government initiated some reforms, but these will need to be completed by the incoming administration.

According to CPD, tax collection has grown by 15.2%, mainly through income tax and VAT components. However, it said questions remain over whether the revenue target can be met even after revision.

To reach the full-year goal, an additional 3% growth would be required, which CPD noted as challenging given current trends.

Gold prices surged sharply in Bangladesh as jewellers announced a fresh hike, pushing the cost of the precious metal to a new high amid continued volatility in the local market.

In a statement issued on Saturday night, Bangladesh Jewellers Association (BAJUS) said the price of 22-carat gold has been increased to Tk227,856 per bhori (11.664 grams), up from the previous rate.

The association cited a rise in the price of tejabi (pure) gold in the local market as the reason behind the latest adjustment, saying the new rates were fixed after reviewing the overall market situation.

According to the revised price list, 21-carat gold will be sold at Tk217,534 per bhori, while the price of 18-carat gold has been set at Tk186,449 per bhori. Gold made under the traditional method will cost Tk155,423 per bhori.

In addition to the selling price, buyers will have to pay a government-mandated 5 percent VAT and a minimum 6 percent making charge fixed by BAJUS. However, the making charge may vary depending on the design and quality of the jewellery.

BAJUS last adjusted gold prices on January 8, when it reduced the price of 22-carat gold by Tk1,050 per bhori to Tk226,806.

With the latest revision, gold prices have been adjusted five times so far this year—three hikes and two cuts. In 2025, BAJUS revised gold prices a total of 93 times, increasing rates on 64 occasions and cutting them 29 times.

Leaders of the Bangladesh LPG Autogas Station and Conversion Workshop Owners Association have called for urgent and effective government intervention to resolve the ongoing LPG crisis, warning that the situation has severely disrupted the country's transport sector.

Mohammad Serajul Mawla, association president, at a press conference held today (10 January) at the Dhaka Reporters Unity, said autogas or liquefied petroleum gas (LPG) is an environment-friendly, easily available and cost-effective fuel that has long been used as an efficient alternative to CNG, petrol, octane and diesel.

He added that with government encouragement, around 1,000 autogas stations have been established across all 64 districts of the country, while nearly 150,000 vehicles have been converted to run on LPG.

However, due to the severe shortage of LPG, almost all autogas stations across the country have effectively shut down, Serajul said.

As a result, station owners, as well as owners and drivers of LPG-run vehicles, are facing extreme hardship, he added.

"Vehicles are unable to get gas even after waiting for hours, disrupting traffic movement and severely affecting passenger services. Passengers are being harassed on a daily basis."

He further said that Bangladesh consumes an average of around 140,000 metric tonnes of LPG per month, of which only about 15,000 metric tonnes, roughly 10% is used in the transport sector.

"Yet the failure to ensure supply of this relatively small amount has pushed the entire LPG autogas industry to the brink of collapse," he said.

Calling on the government to take immediate action, Serajul said ensuring energy security, stability in the transport system, consumer interests and environmental protection requires visible and effective steps without delay.

"If the LPG crisis is not resolved quickly, its impact will deepen further, affecting the overall economy and public life," he added.

At the press conference, the association placed three key demands: urging LPG supplier companies, operators and LPG Operators Association of Bangladesh (LOAB) to ensure adequate supply of LPG autogas in line with demand; calling on the Bangladesh Energy Regulatory Commission (BERC) and other relevant authorities to quickly resolve complications related to LPG imports and ensure sufficient supply to the autogas sector through operators; and taking all necessary measures to prevent future supply disruptions, including importing LPG from alternative sources if needed under government initiative.

Gold prices rose on Friday and were on track for a weekly gain, as investors weighed weaker-than-expected US payrolls data along with broader policy and geopolitical uncertainty.

Spot gold was up 0.5 percent at $4,496.09 per ounce as of 01:31 p.m. ET (1618 GMT), and was set for about 3.9 percent weekly gain. Bullion hit a record high of $4,549.71 on December 26.

US gold futures for February delivery settled 0.9 percent higher at $4,500.90.

US nonfarm payrolls in December rose by 50,000, missing expectations of a 60,000 gain, while the unemployment rate eased to 4.4 percent, below forecasts of 4.5 percent.

“Payrolls are showing us a poor job creation environment. Potentially more (geopolitical tension), somewhat higher oil prices, which are inflationary, uncertainty and an easing Fed — all a combination for precious metals,” said Bart Melek, global head of commodity strategy at TD Securities.

Market participants continued to factor in at least two Federal Reserve rate cuts this year, a backdrop historically favorable for gold.

Geopolitical tensions remained elevated amid intensifying unrest in Iran, continued fighting in Russia’s war in Ukraine, the US capture of Venezuela’s President Nicolas Maduro, and Washington’s renewed signals over taking control of Greenland.

Metals Focus projected gold prices could hit fresh record highs above $5,000 in 2026, citing de-dollarization trends and geopolitical risks.

Retail demand for gold in India remained subdued due to elevated prices, while gold premiums in China widened.

Meanwhile, uncertainty over tariffs persisted, as the US Supreme Court is not expected to issue a ruling on Friday in a major case testing the legality of President Donald Trump’s sweeping global tariffs, with decisions now expected on January 14.

The SME board of the Dhaka Stock Exchange (DSE) suffered a sharp year-on-year decline in 2025, significantly underperforming the main market index.

Sixteen of the 20 SME stocks suffered erosion in market value during the period, many of which had experienced unusual surges without any fundamental factors or corresponding improvements in financial performance.

As a result, the SME index of the prime bourse lost 22 per cent, or 235 points, during the year to close at 856 points-well below its base level set at the board's launch.

The SME board was launched in September.

2021 with six companies and a base index of 1,000 points. It peaked at 2,244 points in August 2022 amid a wave of speculative trading.

In 2025, SME stocks endured price erosion ranging from 6 per cent to 65 per cent. Consequently, the market capitalisation of the SME board fell by more than Tk 4 billion to Tk 17.56 billion at the end of the year.

By contrast, the main board of the Dhaka bourse recorded a comparatively modest decline of 6.7 per cent in its benchmark index over the same period.

Market analysts said the downturn in the SME board was inevitable, given the artificial nature of earlier price hikes that were not supported by corporate earnings or operational performance.

SME companies saw profits decline year-on-year in FY25 as overall economic activities remained subdued following the political shift, which also weighed on their stock prices, said Akramul Alam, head of research at Royal Capital.

"SME companies lack the capital intensity needed for expansion and scalability, which ultimately constrains their financial performance and growth," Alam told The Financial Express.

Several SME stocks had surged earlier without any positive earnings disclosures, raising concerns about market manipulation. At the time, analysts flagged speculative behaviour and rumour-driven trading as key drivers behind inflated valuations.

The SME index began to decline after the fall of the Sheikh Hasina-led regime in August 2024, amid speculation that the new securities commission formed after the political transition would take tougher measures against price manipulation.

Himadri, a stock that had previously played a dominant role in driving the SME index upward, witnessed sharp corrections over the past year.

The Financial Express had published several reports highlighting abnormal price hikes in small-cap stocks, particularly Himadri.

Himadri-an SME company operating six potato cold storages in northern Bangladesh-saw its share price plunge 55 per cent to Tk 657.9 per share by the end of last year.

What surprised market observers was that the little-known stock had surged to nearly Tk 10,000 per share in November 2023, despite the fact that many well-performing, dividend-paying blue-chip companies traded at far lower prices.

In November 2024, the securities regulator penalised one individual investor and three firms a total of Tk 17 million for manipulating Himadri's stock.

The fines were imposed following hearings based on investigation reports submitted by the DSE, which found the four investors engaged in manipulating Himadri's shares in 2023.

Despite the sharp correction, Himadri's share price remains elevated, with a price-to-earnings ratio of 178 as of Thursday.

"Himadri shares should never have traded above blue-chip stocks on the main board," Alam said.

Another SME stock, Oryza Agro Industries, which manufactures and markets fish and poultry feed, recorded the steepest price fall, plunging 65 per cent to Tk 8.5 as its profit declined 31 per cent to Tk 49.75 million in FY25.

Meanwhile, Yusuf Flour Mills, another little-known SME stock, surged 86 per cent to Tk 2,200 at the end of 2025, despite weak fundamentals. The stock had peaked at Tk 6,352 per share in June 2024.

Analysts said the price surge was artificial, as Yusuf Flour's financial performance did not justify the rally. The company's profit fell 43 per cent year-on-year in FY25, and it paid only a 5 per cent cash dividend.Financial planning tools

"A group of dishonest traders has been targeting the SME board to manipulate stocks," Alam said.

However, the new securities commission has taken several market-supportive measures and initiated tough actions against wrongdoers.

As part of a broader effort to promote sustainable capital market development, the commission has imposed heavy fines on several market manipulators and errant companies for malpractices committed during the tenure of the previous commission.

Economists and policymakers today (8 January) called for a clear and coordinated strategic roadmap to accelerate Bangladesh's transition to a cashless economy, citing low adoption of QR code payments and persistently high reliance on cash transactions.

More than 70% of Bangladesh's economic transactions are still conducted in cash, leaving the country far behind its regional peers despite ongoing efforts by the Bangladesh Bank to promote digital payments, said Ashikur Rahman, principal economist at the Policy Research Institute of Bangladesh (PRI).

Ashikur noted that QR code-based transactions remained almost negligible. By value, they accounted for less than 1% of total transactions in October 2025, when Bangladesh recorded just 1.06 million QR code payments, he said.

In contrast, India processed around 723 million such transactions during the same period, highlighting what he described as a "day and night" difference between the two countries.

The PRI principal economist was speaking at a stakeholder consultation workshop titled "Towards a Cashless Economy: A Strategic Roadmap for Bangladesh," organised by PRI in collaboration with the Gates Foundation.

The event brought together policymakers, regulators, economists, representatives from the financial sector and development partners to discuss pathways, challenges and policy priorities for expanding digital and cashless transactions.

Ashikur pointed out that in China even the most marginalised citizens routinely use QR codes to receive financial assistance.

The keynote paper presented at the workshop acknowledged that Bangladesh had made notable progress in digital payments, led by mobile financial services, QR payments and online banking. However, it said a large share of transactions remained cash-based due to key constraints, including limited interoperability, infrastructure gaps, cybersecurity risks and low digital literacy.

The paper identified financial inclusion, reduced transaction costs and improved economic governance as major benefits of a cashless economy. Drawing on global and regional experiences, it emphasised the importance of strong digital public infrastructure and a coordinated regulatory framework. The proposed roadmap recommended phased reforms, stronger inter-agency coordination, expansion of digital infrastructure, enhanced consumer protection and fintech-driven innovation to ensure an inclusive and secure transition.

Addressing as the chief guest, Bangladesh Bank Executive Director Arief Hossain Khan said the central bank is actively implementing initiatives to strengthen digital payments, financial inclusion and a secure payment ecosystem.

He stressed that effective coordination among regulators, financial institutions and technology providers was crucial to ensure that the move towards a cashless economy benefited all segments of society.

PRI Chairman Zaidi Sattar said transaction systems had come full circle in human civilisation. While cash was once a transformative invention, he said, it had now become cumbersome for modern economic activity, pushing societies once again towards cashless modes of exchange.

The workshop was chaired by Sattar and attended by PRI Research Director Bazlul H Khondker, along with senior officials, academics and development partners.

US job growth slowed more than expected in December amid business caution about hiring because of import tariffs and rising artificial intelligence investment, but the unemployment rate dipped to 4.4 per cent, supporting expectations the Federal Reserve would leave interest rates unchanged this month.

Nonfarm payrolls increased by 50,000 jobs last month after rising by a downwardly revised 56,000 in November, the Labor Department's Bureau of Labor Statistics said on Friday. Economists polled by Reuters had forecast 60,000 jobs added after a previously reported 64,000 increase in November.

The closely watched employment report suggested the labor market remained stuck in what economists and policymakers have called a "no hire, no fire" mode. It also confirmed the economy was in a jobless expansion. Economic growth and worker productivity surged in the third quarter, in part attributed to the AI spending boom.

The labor market lost considerable momentum last year, largely blamed on President Donald Trump's aggressive trade and immigration policies, which economists and policymakers said reduced both demand for and supply of workers.

The sharp moderation in job growth, however, started in 2024. The BLS has estimated about 911,000 fewer jobs were created in the 12 months through March 2025 than previously reported. The agency will publish its payrolls benchmark revision next month with the January employment report.

The overcounting has been blamed on the birth-death model, which is used by the BLS to estimate how many jobs were gained or lost because of companies opening or closing in a given month. Last month, the BLS said it would, starting in January, change the birth-death model by incorporating current sample information each month.

Together with the December employment report, the BLS published annual revisions to the household survey data for the past five years. The unemployment rate is calculated from the household survey.

The annual population control adjustments, normally incorporated with the January employment report, will be delayed. November's unemployment rate was revised down to 4.5 per cent from the previously reported 4.6 per cent.

The median forecast in a Reuters poll of economists was for the jobless rate to have eased to 4.5 per cent in December. Some economists say low supply has prevented a sharp rise in the unemployment rate. They estimated that between 50,000 and 120,000 jobs need to be created each month to keep up with growth in the working-age population.

The US central bank cut its benchmark interest rate by a quarter of a percentage point to the 3.50 per cent-3.75 per cent range in December, but officials indicated they were likely to pause further reductions in borrowing costs for now to get a better sense of the economy's direction.

With factors like tariffs and AI preventing companies from hiring more workers, economists increasingly view the labor market's challenges as more structural than cyclical, which would make rate cuts less effective to stimulate job growth.

Bangladesh advances towards strengthening its mutually beneficial trade relationship with the United States, opening the door to greater market access and new opportunities for its vital textile and apparel sector.

A spokesperson for the interim government's Chief Adviser Office Saturday broke the news in Dhaka, following a follow-up trade negotiation with the United States in the US capital.

In response to a request from National Security Adviser Dr Khalilur Rahman, who is currently on a visit to Washington, DC, US Trade Representative Ambassador Jamieson Greer has agreed to raise with President Donald Trump the possibility of reducing Bangladesh's current 20-percent reciprocal tariffs to a rate commensurate with regional competitors'.

"Even more significantly, both sides have developed an innovative and forward-looking solution to support Bangladesh's export priorities," says the spokesman about the fresh tradeoff under a proposed preferential trade scheme.

Under a proposed preferential scheme discussed yesterday (Friday) by Dr Rahman and Ambassador Greer, Bangladesh would receive tariff-free access to the US market for textile and apparel exports equivalent to its imports of US-produced cotton and man-made fiber (MMF) textile inputs, measured on a square-meter basis, he adds.

"This creative, win-win approach strengthens bilateral trade, supports Bangladeshi manufacturers and workers, and deepens supply-chain ties with US producers," it is stated.

It reflects growing momentum and goodwill in US-Bangladesh economic relations and marks a promising new chapter for Bangladesh's global trade prospects, the government notes about the latest developments in the aftermath of the Trump tariff tempest which is roiling global trade order.