The Bangladesh Securities and Exchange Commission (BSEC) has rejected a 35% stock dividend proposal announced by Al-Haj Textile Mills Limited for the financial year that ended in June 2024.

On 14 January, the textile sector firm recommended a 5% cash and 35% stock dividend for its shareholders for FY24. The stock dividend component was subject to the approval by the BSEC.

The company's share price increased today (23 February) by 2% to Tk132.80 on the Dhaka Stock Exchange.

The company's audited financial statements show that the sharp rise in profit was largely driven by a one-off accounting gain following the settlement of a long-running legal dispute with Agrani Bank, rather than a genuine operational recovery.

According to the audited results for FY24, Al-Haj Textile recorded a net profit of Tk22.45 crore, compared to a loss in the previous year. Earnings per share rose to Tk10.07, a significant reversal from a loss per share of Tk0.78 in FY23.

The company's net asset value per share jumped by 119% to Tk18.52, reflecting the impact of the recognised income.

However, the financial statements also show that net operating cash flow per share remained negative at Tk2.58, indicating continued pressure on cash generation from core operations.

The sharp turnaround is particularly striking as the company had posted a net loss of Tk7.56 crore in the nine months to 31 March 2024. This indicates that bulk of the profit was recorded in the final quarter after changes in accounting treatment linked to a disputed fixed deposit receipt with Agrani Bank.

Recently, Alhaj Textile Mills has decided to invest an additional Tk7.80 crore in the Balancing, Modernisation, Rehabilitation and Expansion (BMRE) of its factory to upgrade machinery and enhance operational efficiency. The decision was taken at the company's latest board meeting, according to a disclosure issued last Thursday.

According to the disclosure, the fresh investment will be used to replace older equipment, introduce modern technology and strengthen production capacity at its manufacturing facility.

Company officials said the BMRE initiative is aimed at improving product quality, reducing wastage and optimising energy consumption, while boosting overall productivity. The move is also expected to help the mill respond more effectively to evolving market demand and buyer requirements.

Industry insiders noted that with competition intensifying in both domestic and export markets, textile manufacturers are increasingly focusing on modernisation and efficiency to sustain profitability. In that context, the additional investment is seen as a strategic step to ensure long-term operational sustainability.

Revenue collection in January grew by only 3.2% year-on-year – the weakest in recent months – signalling stress in trade flows and slowing economic activity.

With customs revenue remaining volatile and domestic demand softening, the slowdown threatens to complicate the new government's fiscal management in the months ahead.

The January figure marks a sharp deceleration from the robust growth recorded earlier in the fiscal year, when monthly collections expanded by 18% to 25% between July and September. Although revenue growth remained in double digits through much of the first half, January's modest increase indicates that the initial rebound in imports and domestic activity is losing momentum.

In January alone, revenue collection fell short of the target by Tk15,000 crore.

According to updated data released by the National Board of Revenue (NBR) today (23 February), revenue collection during the first seven months (July–January) of the current fiscal year fell short of the target by more than Tk60,000 crore.

Although revenue growth during the July–January period stood at around 13%, actual collection reached Tk2.63 lakh crore against a target of Tk2.83 lakh crore.

Breaking with convention after the last budget, the government revised the annual revenue target upward by Tk54,000 crore midway through the fiscal year, raising it to Tk5.54 lakh crore.

NBR data show that over the past seven months, average monthly revenue collection stood at slightly below Tk32,000 crore. To meet the revised target, however, the revenue authority would need to collect more than Tk66,000 crore per month on average for the remaining months of the fiscal year.

Experts say this is not realistically achievable.

Dr Fahmida Khatun, Executive Director of the Centre for Policy Dialogue (CPD), told The Business Standard, "The economy has not gained the kind of momentum that would allow the NBR to collect revenue at such a high rate. As a result, the government is heading towards another large shortfall this fiscal year."

She added that the new government under Tarique Rahman has incorporated additional spending commitments in its election manifesto, including family cards and agricultural loan waivers. If expected revenue is not realised, fiscal pressure on the new administration will intensify.

While revenue growth exceeded 15% in six of the seven months of the fiscal year, officials were unable to explain the sudden drop in January. When contacted, a senior NBR official said he could not specify the reason behind the sharp slowdown.

Data analysis shows that import tax collection in January actually declined by 1.31% compared to the same month last year. Value-added tax (VAT) collection grew by only 2.57%, while income tax recorded relatively better growth at 7%, though still modest.

Nearly 90% of import tax is collected through Chattogram Custom House. When contacted, Mohammad Shafi Uddin, Commissioner of Custom House Chattogram, said the customs house recorded 15% growth in January. Why overall growth remained weak despite this remains unclear.

Explaining the underperformance in revenue collection, Fahmida Khatun cited slow investment and sluggish economic growth as major factors. She also pointed to institutional capacity constraints within the NBR, saying the tax net is not expanding and tax evasion is not being effectively curbed.

"Necessary reforms to boost revenue collection have largely not been implemented," she said. "As a result, prospects for stronger revenue performance in the coming months also appear limited."

The general election held on 12 February has reduced near-term political and policy uncertainty in Bangladesh, a development that could bolster macroeconomic stability, according to Fitch Ratings.

However, in a report released on 22 February US time, the global ratings agency cautioned that the ultimate impact on the country's credit profile will depend on the new government's ability to execute critical reforms to address weak governance, banking-sector fragilities, and a fragile external liquidity position.

Fitch noted that the supermajority secured by the BNP-led alliance, coupled with a successful referendum, provides a clear mandate for constitutional and economic shifts.

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The BNP won 209 seats, while the Jamaat-e-Islami and its allies secured 77 of the 299 contested seats.

This two-thirds majority is expected to support the implementation of the government's policy agenda and reduce the risk of a political vacuum that could otherwise complicate economic decision-making, according to Fitch's report.

The ratings agency highlighted that the referendum approval could pave the way for institutional strengthening, including a shift to a bicameral legislative system, enhanced judicial independence, and the institution of term limits for the prime minister.

Despite these positive signals, Fitch warned that implementation remains complex and execution risks remain elevated.

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It also noted that political polarisation and the military's potential role in politics continue to pose lingering risks.

Fitch observed that the BNP's manifesto signals a commitment to continuing the economic and fiscal reforms initiated during the caretaker government period.

The agenda also points to higher social spending, which could, in Fitch's observation, add pressure to public finances if revenue‑mobilisation measures underperform, and would test the authorities' ability to balance growth and electoral commitments with fiscal consolidation.

Additionally, this agenda aligns with the $5.5 billion International Monetary Fund (IMF) programme running through 2026-2027 since 2023.

A centrepiece of this fiscal plan is a medium-term goal to raise the tax-to-GDP ratio to 10% through tax administration reforms and a broader tax base.

Bangladesh’s forex reserves rise to $29.86b

"This matters for credit quality because Bangladesh's structurally low revenue intake remains a key weakness," states the report.

Fitch currently projects government revenue-to-GDP to reach 8.6% by the 2027 fiscal year, up from 7.8% in FY25.

The agency further noted a pro-private-sector tilt in the new government's stance, aiming to lift foreign direct investment to 2.5% of GDP from a Fitch-estimated 0.4% in FY25.

The BNP's pledges to tackle non-performing loans and improve banking governance were also cited as essential steps to addressing constraints on the sovereign credit profile.

ADP spending drops by Tk9,300cr YoY in 7 months

On the external front, foreign-exchange reserves showed improvement, reaching $29.7 billion as of 10 February, compared to $22.3 billion in June 2024.

The Fitch report concluded that a manageable external debt repayment profile and the prevalence of government-backed debt help contain refinancing risks, but also underscore the importance of maintaining macro-stabilisation policies that keep external financing risks in check.

The National Board of Revenue (NBR) has started budget-related work for the fiscal year 2026-27 and has sought proposals from business bodies and other relevant organisations.

According to the NBR, letters have already been sent on 18 February from the budget-related departments asking them to submit their proposals and recommendations on the budget to the NBR by 15 March.

In a letter to the business bodies, signed by Barrister Badruzzaman Munshi, second secretary of the NBR's VAT wing, the agency said, "You are requested to send your organisation's opinions with the aim of rationalising the tax-to-GDP ratio, facilitating ease of doing business, and resolving procedural complexities."

Sources at the NBR said pre-budget discussions with business representatives and other stakeholders may begin by the last week of this month in preparation for the next budget. To this end, the NBR has also formed a committee, appointing a first secretary of NBR as the chief budget coordinator, sources said.

This will be the first budget for the new government led by the BNP. Although budgets during the previous two BNP governments were prepared under the leadership of late finance minister M Saifur Rahman, this time the budget will be prepared under the leadership of Finance Minister Amir Khasru Mahmud Chowdhury.

He has already provided preliminary directions during a meeting held last Saturday with officials from the NBR and other relevant departments regarding the budget, according to officials.

Delivering structural reforms, improving external liquidity and lifting revenue collection will be crucial to restoring macroeconomic stability in Bangladesh, said Fitch Ratings in a report released on Sunday.

The global rating agency said the general election held on February 12 has eased near-term political and policy uncertainty, creating room for progress on stabilisation.

The Bangladesh Nationalist Party (BNP)-led alliance secured a parliamentary supermajority, along with a majority “yes” vote in a referendum that could pave the way for constitutional reforms.

However, the road ahead will not be straightforward, it warned.

Fitch said longstanding credit constraints such as weak governance, fragilities in the banking sector and a thin external liquidity buffer mean the new government’s ability to carry through its macroeconomic and fiscal reform agenda will determine the rating impact.

Fitch Ratings, one of the big three global credit rating agencies alongside S&P Global and Moody’s, said that execution will be decisive.

The referendum result could open the door to institutional reforms, including a shift from a unicameral to a bicameral system, stronger judicial independence and term limits for the prime minister.

“However, implementation could be complex and time-consuming, keeping execution risk elevated.”

Fitch underlined the importance of staying the course under the $5.5 billion programme with the International Monetary Fund (IMF). Stronger tax mobilisation and prudent management of foreign exchange reserves will also be vital to underpin stability and support durable growth.

“The reform agenda appears consistent with the macro-stabilisation agenda under the IMF programme,” Fitch said.

It added that “ongoing reform implementation and durability of such reforms beyond the IMF programme will be a key condition for facilitating macroeconomic stability and growth.”

At the same time, external buffers remain a near-term watchpoint. “External liquidity remains another near-term indicator even as reserves improve,” Fitch noted, adding that policymakers must maintain stabilisation measures to “keep external financing risks in check.”

On public finances, the agency described the structurally low revenue intake as a core weakness. The BNP manifesto sets a target of raising the tax-to-GDP ratio to 10 percent through administrative reform, fewer exemptions and a broader tax base.

“This matters for credit quality,” the agency said, signalling that stronger revenue performance will be central to easing fiscal strain and entrenching stability.

Fitch projects general government revenue to GDP at 8.6 percent by FY27, up from 7.8 percent in FY25.

Policy signals in the BNP manifesto suggest the new government is likely to continue the economic and fiscal reforms initiated under the caretaker government. At the same time, plans for higher social spending could stretch public finances if revenue measures fall short, testing the authorities’ ability to balance growth ambitions and electoral pledges with fiscal discipline.

The manifesto also outlines a pro-private sector agenda. It promises simpler licensing rules, incentives for export-oriented industries and a push to lift foreign direct investment to 2.5 percent of GDP from an estimated 0.4 percent of GDP in FY25.

Efforts to strengthen governance in banks and tackle non-performing loans (NPLs) could, if delivered, ease a major constraint on the sovereign credit profile.

With a two-thirds majority in parliament, the BNP should have the numbers to press ahead with its policy plans. The election outcome also lowers the risk of a prolonged political vacuum that could have hampered economic decision-making.

Still, political risk has not disappeared. Bangladesh, rated B plus with a Stable outlook, has a history of polarisation and pre-election unrest. That leaves scope for renewed tension if promises prove hard to fulfil or if performance falls short of expectations.

“The military may also continue to play a role in politics,” said the agency.

Foreign investment in the country's stock market weakened in 2025, with overseas investors pulling out a net Tk270 crore from equities amid economic fragility, market volatility and pre-election uncertainty, according to data from the Dhaka Stock Exchange.

The data shows that foreign investors sold shares worth Tk2,095.34 crore in 2025, while purchasing stocks valued at Tk1,825.07 crore, resulting in a net negative position of Tk270 crore for the year.

Analysts and insiders said foreign investors remained cautious in the capital market ahead of the February 2026 election amid political and economic uncertainty, continuing to withdraw funds throughout the year.

Reviewing the 2025 trading data, they believe that following the election, foreign investors' confidence in the market has improved, which is expected to turn their net position positive in the coming months.

A fortnightly data for February (1 to 15) showed that in the first 15 days, foreign trading year-on-year increased by 48% to Tk173 crore, which was Tk116.63 crore in the same time of 2025.

Ahsanur Rahman, CEO of BRAC EPL Stock Brokerage, a key brokerage house for foreign investors, told The Business Standard, "Foreign investors were more cautious in 2025 due to the upcoming election and economic uncertainty."

He said that following the election, investors' confidence increased. "In post-election trading, foreigners have turned more bullish in the market and they are concentrating on buying good and fundamental stocks."

He expressed hope that foreign investors' net investment position would turn positive in February, as their investments are likely to exceed their sales.

Md Ashequr Rahman, managing director of Midway Securities, also expressed hope that foreign investment in the capital market is likely to increase after the election, as he has observed fresh fund inflows into the market.

He said that due to various factors – including the prevailing economic conditions – foreign investors remained very cautious, which is why they continued to withdraw funds.

"If the capital market functions properly and the supply of quality stocks is ensured, foreign fund inflows may increase in Bangladesh, as many investors are now shifting towards emerging and frontier markets," he added.

Additionally, reform initiatives by the capital market regulator, the Bangladesh Securities and Exchange Commission, kept the market at a standstill as no IPO to raise funds, and some actions for manipulation led to market volatility.

The existing commission was formed by the interim government in August 2024 after the student-led uprising.

In 2025, foreign turnover in stocks – both buying and selling – slightly increased by 8% to Tk3,920 crore compared with 2024.

Foreign investors withdrew significant funds from stocks in 2024 as well, with their net investment position turning negative by Tk261 crore.

Over the past eight years, foreign investors' net investment position was negative in seven of those years, with 2023 being the only year with a positive position of Tk64 crore.

Analysing the 2025 data, in five out of the 12 months, foreign investors' net investment position was positive, meaning that in those months they bought more shares than they liquidated through sales.

From May to August 2025, foreign investors were particularly active in buying shares, which pushed stocks higher and lifted the DSEX significantly.

Since then, until December, they continued to sell off shares to withdraw funds.

Lack of good stocks

Market experts and investors said that in the local capital, there is a lack of quality and good stocks.

They advised that the new government take initiatives to make the capital market vibrant and to list state-owned, highly profitable firms on the market.

Over the last year under the interim government, there was much discussion to enlist the state-owned firms on the stock market, but not a single firm got enlisted.

Ahsanur Rahman said, "There is a shortage of quality stocks in the market to attract foreign investors. Only a handful of stocks meet their return expectations.

"To revitalise the capital market and draw foreign participation, we must list more fundamentally strong companies."

Bangladesh's export momentum braces for fresh headwinds as uncertainty over the fate of the United States' short-term 15% tariff—whether it will be extended, increased or withdrawn after five months—has prompted American buyers to pause fresh commitments.

Beyond the freeze in new orders, the tariff—imposed by President Donald Trump after the US Supreme Court scrapped reciprocal tariffs—has triggered renegotiations on existing shipments.

Several US buyers are now demanding 2% price cuts on goods already in the pipeline, following the reduction of the tariff from 20% to 15%. Exporters say the move threatens to further erode already thin margins.

Buyers 'sitting on the fence'

At least eight Bangladeshi exporters told The Business Standard that US clients are "sitting on the fence" amid rapidly shifting trade policies. Seven reported a clear pause in decision-making, warning that order flows will not normalise without long-term policy clarity.

Shovon Islam, managing director of Sparrow Group, said buyers are in observation mode.

"They are deferring decisions until the final tariff structure becomes clear. Without certainty, long-term planning is impossible," he said.

SM Khaled, managing director of Snowtex Group, echoed the concern. "Our current order book is secured until June, but there is deep uncertainty about what happens after the five-month window," he said.

For Khaled, whose annual exports exceed $200 million, the US accounts for 20% of total trade. The present volatility, he added, has created a procurement stalemate, with buyers reluctant to commit beyond immediate needs.

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association, described the situation as "unpredictable".

"Buyers are in the dark about where the tariff rates will finally land," he said. According to him, customers are placing only minimum-volume orders, a conservative approach that could severely hurt Bangladesh's garment exports if prolonged.

Policy volatility weighs on trade

Economists say the stop-start nature of US trade policy is amplifying risk.

Professor Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue, pointed to the legal oscillation shaping US tariff measures.

"The Supreme Court struck down the initial reciprocal tariffs, but the administration quickly introduced new ones under different statutes," he noted.

Because President Trump retains the authority to impose targeted or "surgical" tariffs on specific products or countries, Mustafizur warned that buyers are operating in a vacuum of uncertainty—booking orders only when unavoidable.

The US remains Bangladesh's largest apparel market, absorbing around 20% of total garment exports.

Data from the US-based Office of Textiles and Apparel (Otexa) show that US imports from Bangladesh reached $8.18 billion in 2025, accounting for 11% of total US global apparel sourcing.

In April 2025, the Trump administration initially set a 37% reciprocal tariff on Bangladesh, later negotiated down to 20% by August. Exporters now fear that a uniform 15% tariff applied equally to all countries would wipe out Bangladesh's relative advantage.

"The earlier tariff structure gave us a head start over China and India," Khaled said. "We captured orders shifting out of China because of higher costs there. With a flat tariff, that incentive disappears."

Otexa data show that between January and November 2025, Chinese garment exports to the US fell 34%, while Bangladesh's shipments grew 12%, alongside gains by several other major apparel exporters.

A level tariff regime, exporters argue, could reverse that trend by intensifying competition.

Buying houses squeezed as buyers seek discounts

The reduction from 20% to 15% has sparked immediate renegotiation attempts.

The Business Standard has seen an email from a mid-sized US buyer requesting a 2% downward adjustment on already-placed orders that have yet to clear customs.

"Please note due to recent tariff changes, Charles is requiring a 2% adjustment to the DDP cost for any goods that have not cleared customs," the message reads, instructing compliance by close of business Monday (US time).

A senior official at a Dhaka-based buying house, speaking anonymously, said the burden of adjustment would fall on intermediaries.

"We cannot push manufacturers for further discounts. We have to absorb the cuts ourselves," he said. For his firm, which sends 90% of its shipments to the US, the financial exposure is significant.

Other agents said the weekend timing of Washington's tariff shift left them scrambling as the US business week began, anticipating further renegotiation requests.

Mohammad Hatem warned that more buyers are likely to follow suit.

Yet exporters argue that the 5 percentage-point tariff reduction should not be captured entirely by retailers. They say manufacturers had already slashed prices during the higher-tariff period to keep orders flowing and deserve to share in the benefit.

Shovon Islam said his group plans to seek a 1% share of the savings from buyers.

Khaled, however, struck a more sceptical tone. "The buyers are pocketing the entire benefit of the lower rates without offering us any concessions," he said.

For now, Bangladesh's garment sector finds itself caught between policy unpredictability in Washington and pricing pressure from its largest export market—waiting for clarity that may not come soon.

The Dhaka stock market rebounded strongly on the back of fresh policy support from the central bank, with investors cheering the relaxation of down payment requirements for loan rescheduling amid ongoing stress in the banking sector.

The benchmark DSEX of the Dhaka Stock Exchange (DSE) jumped 85 points, or 1.55%, to close at 5,553, snapping its recent subdued trend.

The blue-chip DS30 index also rose 33 points to 2,137, reflecting broad-based gains as 347 issues advanced, 21 declined, and two remained unchanged.

Market capitalisation increased by Tk5,280 crore to Tk7.16 lakh crore, signalling renewed investor confidence, while turnover climbed 26% to Tk718 crore, indicating improved participation across sectors.

According to EBL Securities, the market momentum reverted to a positive trajectory following recent corrections, after election-driven optimism had cooled.

Buying in banking stocks primarily drove the rally, as investors viewed the central bank's latest move to ease loan rescheduling rules as a favourable step to manage rising non-performing loans in the sector.

The market opened on a strong footing, gaining nearly 80 points within the first half hour of trading, with predominant buying interest in large-cap stocks setting the tone for the session. Confidence returned gradually, prompting investors to accumulate shares across sectors, reflecting perceived strength in underlying market momentum.

Banking stocks led the turnover chart, with City Bank and BRAC Bank among the most actively traded.

Other top turnover contributors included Summit Alliance Port Limited, Khan Brothers PP Woven Bag Industries, and Olympic Industries.

Market insiders said the rally was further supported by a recent 18% cut in furnace oil prices by the Bangladesh Energy Regulatory Commission, expected to reduce electricity generation and factory overhead costs, particularly benefiting manufacturing companies.

Investors were also encouraged by circulating speculation about potential changes in top positions at the stock market regulator, adding to market optimism.

Among the day's top gainers were RSRM Steel, Midas Finance, and LR Global Mutual Fund One, each rising 10%, followed by Alif Manufacturing and Energypac Power with notable advances.

On the losing side, Meghna Cement fell 8.3%, while Bata Shoe, Zeal Bangla Sugar, Standard Bank, and ICB AMCL First Agrani Bank Mutual Fund posted modest declines.

Around Tk72 crore worth of shares of Olympic Industries changed hands in the block market of the Dhaka Stock Exchange (DSE) yesterday, signalling a strategic transaction involving the company's sponsor director.

A total of 50 lakh shares were traded in the block market at Tk144 per share during the session. In contrast, the stock closed at Tk163.10 apiece in the public market, marking a 2% increase from the previous trading day.

In the block market, transactions are executed between pre-arranged buyers and sellers at mutually agreed prices. Shares worth below Tk5 lakh are not permitted in this segment, and the standard 10% upper and lower circuit breaker limits apply.

Market insiders said the block trade was executed by the company's chairman and sponsor director, Aziz Mohammad Bhai, as part of his earlier plan to increase his stake. The shares were reportedly purchased from foreign investors.

Earlier on 19 February, Aziz Mohammad Bhai disclosed his intention to buy one crore shares of Olympic Industries through the block market within the next 30 working days at the prevailing market price.

Following that declaration, Olympic Industries' share price rose by 7% on the Dhaka bourse, reflecting a positive response from investors.

Analysts said such moves by sponsor directors are generally perceived as a sign of confidence in a company's fundamentals and long-term prospects.

At present, foreign investors hold 32.83% of the company's shares, while institutional investors own 21.90%. The general public holds 12.89%, and the remaining shares are held by sponsors and directors.

The latest acquisition is expected to further increase the sponsor-director shareholding, though details of his previous stake were not disclosed.

Olympic Industries Limited is the country's largest branded biscuit manufacturer and a leading fast-moving consumer goods company, producing a wide range of biscuits, confectionery, and bakery products for both domestic and export markets.

For the July–December period of 2025, the company reported revenue of Tk1,548 crore, up from Tk1,490 crore in the same period a year earlier. Earnings per share stood at Tk5.99, compared to Tk5.82 previously, while net asset value per share reached Tk65.34 as of December 2025.

The commerce ministry has convened a stakeholder consultation for tomorrow, bringing together economists, trade analysts, business leaders and senior officials from across the government to assess its reciprocal trade deal with the United States and determine the next steps.

The meeting is expected to be the first in a series of stakeholder consultations as Dhaka prepares to re-engage Washington.

“We will hold more meetings with different stakeholders and prepare for the next course of action with the US,” Commerce Secretary Mahbubur Rahman told The Daily Star over the phone, confirming tomorrow’s meeting.

The urgency stems from a ruling on February 20 in which the US Supreme Court struck down a large swathe of reciprocal tariffs imposed by President Donald Trump using an emergency law. The court ruled that the president’s actions were illegal as he did not take congressional approval before imposing the tariffs.

Officials in Dhaka are assessing whether the trade deal with the US, signed on February 9 to reduce the tariff rate, has been invalidated following the court’s ruling. The government is yet to formally write to the United States Trade Representative (USTR) to clarify the agreement’s status.

Under the deal, Dhaka had pledged to buy roughly $3.5 billion worth of American agricultural goods -- wheat, soy, cotton and corn -- along with $15 billion in energy products over 15 years and approximately 14 Boeing aircraft.

“It is not clear yet whether Bangladesh will have to import the goods it committed to buy,” the commerce secretary said.

In exchange, Washington agreed to cut its reciprocal tariff on Bangladeshi goods to 19 percent, down from the higher rates imposed earlier.

However, following the court’s ruling, President Trump announced a 15 percent universal tariff applicable to all countries, a figure he had already nudged up from an initial 10 percent.

That blanket rate complicates Dhaka’s predicament considerably.

If the 15 percent tariff applies uniformly to all countries, Bangladesh will not rush into negotiations as there would be no relative disadvantage, Secretary Rahman said.

Yet there is a countervailing logic. The government believes that the Trump administration may reserve tariff concessions for countries that have demonstrated a willingness to engage commercially with the US.

“There is a perception that the Trump administration may lower the 15 percent universal tariff rate for the countries which have engagement with the US,” the commerce secretary added.

Revenue collection by the National Board of Revenue (NBR) grew 13 percent year-on-year to Tk 2.24 lakh crore in the July-January period of fiscal year 2025-26 (FY26), driven largely by strong VAT receipts from domestic trade and economic activity.

Yet, the country’s largest tax collector missed its target by 27 percent, a shortfall of Tk 60,110 crore, for the period, according to provisional data.

The immediate-past interim government in late November revised NBR’s full-year revenue target to Tk 5.54 lakh crore after a strong first quarter, up from Tk 4.99 lakh crore.

To meet the full-year target, the board would need to collect Tk 3.30 lakh crore in just the remaining five months of the fiscal year, which economists say is an unrealistic goal.

Persistent inflation, sluggish implementation of development projects, and a broader economic slowdown make such a surge virtually impossible.

According to a paper by Towfiqul Islam Khan, additional director (research) at the Centre for Policy Dialogue (CPD), the total revenue shortfall for FY26 will exceed Tk 1 lakh crore, much like what was recorded in FY25.

“Bangladesh is now in a position where it cannot meet recurrent operating expenditure with domestic revenue mobilisation,” Khan said while presenting a paper at a Citizen’s Platform for SDGs briefing last week.

He described the country as facing “diminishing fiscal space,” with borrowing for debt repayment rising significantly and non-development expenditure squeezing policy room further.

“The budget for FY2026 has also made some lofty fiscal framework targets,” he said.

Additional pressure is mounting from election-related costs and the need to inject capital into distressed financial institutions.

A recourse to bank borrowing reflects this tightening.

Net borrowing from the banking sector by crossed Tk 48,800 crore by January 25, nearly five times the Tk 10,558 crore borrowed in nearly the same period a year earlier, according to Bangladesh Bank provisional data.

Within the July–January tax receipts, VAT (value-added tax) from domestic activity was the largest contributor at 38 percent of total collection, rising 16.45 percent year on year to Tk 85,769 crore.

Direct taxes – income and corporate – accounted for 33.5 percent, climbing 13 percent to Tk 75,055 crore. Import tariffs grew more modestly, up 8 percent to Tk 62,813 crore.

Overall receipts increased at a faster pace in the July-January period of FY26 than a year ago, when the tax administration logged only 2 percent growth.

Growth in January 2026 alone, however, slowed sharply to just 3.21 percent compared to the same month last year.

The Ministry of Commerce has convened a meeting with leading exporters and trade economists tomorrow to assess the impact of the United States' new 15% global tariff and coordinate a strategic response.

But officials said Dhaka will neither initiate immediate talks with Washington nor move forward with the ratification of the existing trade pact for the time being.

Commerce Secretary Mahbubur Rahman confirmed the decision to The Business Standard, adding that the government would first consult domestic stakeholders before deciding on any next steps.

"On Wednesday (25 February), we will sit with our key stakeholders – exporters and trade-related economists – to hear their views and suggestions. Beyond that, we have no plan at the moment to engage in discussions with the United States," he said.

The secretary noted that although Bangladesh had signed a trade agreement with the US following the announcement of reciprocal tariffs, the agreement has not yet come into effect.

"We will remain quiet for now. We will not take the initiative to engage in talks with the US. Until the US ratifies the agreement and sends a notification, there is no need for discussions about complying with it."
Commerce Secretary Mahbubur Rahman

"The agreement states that it will become effective once both countries ratify it and notify each other. Bangladesh will not ratify the agreement for now," he said.

Mahbubur said, "If the United States ratifies it and sends us a notification, then we will enter into discussions with them. At that point, we will be able to ask on what basis they ratified the agreement after the US Supreme Court scrapped the reciprocal tariff measure," he added.

The US Supreme Court recently declared the reciprocal tariff unlawful. However, under a different legal provision, Washington has since announced a 15% duty on goods from nearly all countries.

Mahbubur said Bangladesh's response would depend on how the US proceeds.

"Since we have signed the agreement, the United States will naturally want us to comply with it. We can then tell them that if a uniform 15% tariff is imposed on all countries, and Bangladesh is not given any additional benefit, why should we adhere to the agreement?" he said.

"Everything will depend on what kind of benefits they offer Bangladesh," he added.

The commerce secretary said Dhaka would adopt a wait-and-see approach. "We will remain quiet for now. We will not take the initiative to engage in talks with the United States. Until the US ratifies the agreement and sends a notification, there is no need for discussions about complying with it."

He added that if the 15% tariff is applied uniformly to all countries, Bangladesh may have limited room to respond. However, if there is scope for country-specific reductions, Dhaka would consider entering negotiations to seek a lower rate.

The government is set to adopt a "One Health Approach" to tackle health emergencies and pandemics, recognising that approximately 75% of emerging human infectious diseases are zoonotic — naturally transmitted from animals to humans — and that environmental factors also play a crucial role.

A new project titled "Strengthening Health Emergency Prevention, Preparedness, Response and Resilience with One Health Approach" has been proposed, with an estimated cost of Tk2,993 crore. Of the total amount, Tk2,745 crore will be provided as a loan by the World Bank.

The project aims for completion by 2030 and will be implemented jointly by the Health Services Division, the Directorate General of Health Services (DGHS), and the Department of Livestock Services (DLS).

The project proposal has already been sent to the Planning Commission for approval, and a Project Evaluation Committee (PEC) meeting on the proposal is scheduled for next Wednesday, according to Planning Commission sources.

Infograph: tBS
Infograph: tBS

Integrated approach to health safety

The One Health Approach focuses on the interconnectedness of human, animal, plant, and environmental health. The project aims to strengthen Bangladesh's capacity to detect, prevent, and respond to health emergencies.

According to the project proposal, key targets include detecting 70% of priority outbreaks within seven days, delivering 70% of lab results within three days, and certifying 80% of public BSL-2 and 100% of BSL-3 labs for biosafety.

Emergency preparedness measures include establishing epidemiological units in 45 districts, forming 182 rapid response teams, preparing 50 upazilas for health emergencies, and strengthening critical care in 10 medical college hospitals.

Animal health interventions include achieving 80% rabies vaccination coverage among roaming dogs and establishing five animal disease-free zones.

In Bangladesh, in the wake of the 2007 avian influenza outbreak, experts in human, animal, and environmental health came together to form the One Health network. Subsequently, an inter-ministerial steering committee and the One Health Secretariat were established to coordinate and strengthen this integrated approach

Infograph: TBS
Infograph: TBS

Strengthening surveillance systems

The project will implement the One Health Strategic Framework, covering 11 core areas such as governance, workforce development, laboratory capacity, epidemic preparedness, integrated surveillance, food safety, antimicrobial resistance (AMR) control, and environmental protection.

A National Integrated One Health Surveillance and Early Warning System (BOHSEWS) will be developed for real-time disease detection. Laboratory networks, molecular diagnostics, biosafety, and lab information systems will be strengthened, alongside training programs, including sandwich PhD initiatives to build skilled professionals in epidemiology and disease surveillance.

Regional, community-level preparedness

Dr M Mushtuq Husain, scientific secretary of One Health Bangladesh, highlighted the importance of early detection and the "7-1-7" framework: detect infections within seven days, report within one day, and respond effectively within seven days.

The public health expert noted that coordinated action across human, animal, and environmental health sectors is essential to prevent pandemics.

The project also aims to enhance national surge capacity, establish an Emergency Operations Centre (EOC) network, create rapid response teams, maintain emergency stockpiles, and implement AMR control, zoonotic disease prevention, food safety, vector-borne disease control, and digital animal tracking.

Regional cooperation with South Asian countries will be strengthened through joint risk assessments,

In a fresh relief for struggling industries, the Bangladesh Bank has eased loan rescheduling conditions, allowing distressed borrowers to pay only half of the required down payment – 2% of the total outstanding loan – upfront and clear the remainder within six months.

A circular in this regard was issued today (22 February) by the Banking Regulation and Policy Department (BRPD).

The decision also allows additional time extensions and gives bank boards greater discretion over interest-related decisions. Analysts say the measures are designed to stabilise banks' balance sheets at a time when bad loans are climbing and credit growth remains weak.

The circular comes as investment has fallen to multi-year lows and construction activity has slowed sharply. Non-performing loans (NPLs) are hovering above 35%, while borrowing costs range between 14% and 16%.

Against this backdrop, the central bank's decision is widely viewed as an effort to prevent a fresh wave of defaults and give businesses breathing space during a fragile recovery.

Mashrur Arefin, chairman of the Association of Bankers, Bangladesh, said, "While temporary relief can be justified in exceptional circumstances, repeated regulatory forbearance does weaken credit discipline and harm the long-term health of the banking system."

"Capital has a real cost. Continued extensions without strong borrower commitment and equity participation create moral hazard."

"What I fear is such policy signals. They shape behaviour and expectations. They sound like politically motivated decisions," he added. "I call for accountability and market-based discipline, not dependence on repeated regulatory relief."

'Each case is unique'

Sohail RK Hussain, managing director of Bank Asia, said any rescheduling must address the root causes of default.

"If a loan is rescheduled, the root cause must be identified and addressed. If a loan has become overdue and is rescheduled for 10 years, it makes little sense. But if someone has genuinely suffered losses, then the customer must inject new equity. In that case, rescheduling can be meaningful," he said.

He added that under previous regimes, rescheduling was often granted automatically upon application.

"In the past, whenever an application came, loans were rescheduled. Customers effectively enjoyed the bank's money without paying anything. Since every case is unique, this circular gives banks flexibility, but they must implement it prudently," he said.

"If implemented properly, it will be good for the banking sector. If not, it will be harmful," he added.

A deputy managing director of a private bank, speaking on condition of anonymity, said, "Implementing this circular may help lower NPLs, but if customers or businesses do not repay properly, these policy supports will not be effective."

Under the new circular, the Bangladesh Bank also extended the deadline for special loan restructuring. The earlier deadline of 31 December has been pushed back by three months to 31 March 2026.

In addition, decisions regarding interest waivers may now be taken by the boards of the respective financing institutions, within existing policies and based on banker-customer relationships.

The Trading Corporation of Bangladesh (TCB) incurred a deficit of around Tk1,412 crore in fiscal year 2024-25 from subsidised sales of sugar, soybean oil and lentils under its family card and open truck programmes.

The commerce ministry has written to the finance ministry seeking release of funds to cover the shortfall.

In a letter today (22 February), Commerce Secretary Mahbubur Rahman said the import and local procurement costs and sale prices of TCB products for FY25 were properly audited. According to the audit report, the subsidy claimed by TCB is justified.

To support low-income groups, the government supplies essential commodities once a month at subsidised prices through TCB family cards. Cardholders receive two litres of soybean oil, two kilograms of lentils, one kilogram of sugar and five kilograms of rice. Additional items are sometimes included.

According to TCB data, soybean oil is sold at Tk100 per litre, sugar at Tk70 per kilogram and lentils at Tk60 per kilogram. However, procurement costs, storage expenses and dealer commissions result in total costs exceeding the selling price.

TCB currently has more than 4.5 million family cards. In special situations, products are also sold through open trucks, although prices in truck sales are slightly higher.

A senior TCB official said the total annual subsidy, including Ramadan items, rice and onions, amounts to around Tk3,500 crore. However, soybean oil, sugar and lentils are the main items under the family card scheme, and their subsidy is calculated separately.

He warned that without timely release of subsidy funds, it would not be possible to procure these essential items on schedule.

The Dhaka stock market ended the week on a positive note, with National Bank emerging as the top gainer, while Islami Bank Bangladesh PLC stood as the worst-performing stock.

National Bank registered a strong 29.27% weekly return, closing at Tk5.30, driven by notable investor interest in banking stocks.

Bangladesh Industrial Finance Company (BIFC) followed with a 28.57% gain to settle at Tk3.60. S Alam Cold Rolled Steels Limited continued its recent rally, advancing 27.50% to Tk15.30 despite persistent financial concerns.

Other significant gainers included Fareast Finance and Premier Leasing, both rising 27.27% to Tk1.40 each. Prime Finance climbed 22.73% to Tk2.70, while Daffodil Computer gained 22% to close at Tk56.

Infographic: TBS
Infographic: TBS

Meanwhile, Familytex and Tung Hai Knitting each posted 20% gains, ending the week at Tk1.80 and Tk2.40, respectively. Shurwid Industries advanced 19.61% to Tk6.10.

On the losing side, Islami Bank Bangladesh PLC declined 12.28% to close at Tk45.70, topping the losers' chart. ICB Islamic Bank fell 10.71% to Tk2.50, while Midas Finance shed 9.38% to Tk6.40.

Al-Arafah Islami Bank lost 9.09% to Tk16, and Union Capital dropped 8.89% to Tk4.10. Crystal Insurance retreated 8.53% to Tk77.20, while Asiatic Laboratories Limited fell 7.89% to Tk63. Phoenix Finance also declined 7.50% to Tk3.70.

The benchmark DSEX index extended its upward trend for the fifth consecutive week, supported by strong post-election optimism at the start of trading.

Following the election holidays, trading resumed with broad-based buying pressure that pushed the index past the 5,600-mark for the first time in nearly six months.

However, EBL Securities, in its weekly market review, noted that the initial enthusiasm moderated in later sessions as investors engaged in profit-booking and adopted a cautious stance, closely watching policy signals and regulatory developments under the newly elected government.

By the end of the week, DSEX gained 66 points, or 1.2%, to settle at 5,466. Market participation remained strong, with average daily turnover rising to Tk1,050 crore.

Sector-wise, the banking sector dominated trading activity, accounting for 20.7% of total turnover, followed by pharmaceuticals at 16.3% and textiles at 10.2%.

Most sectors posted positive returns during the week. The paper sector led gains with a 5.3% increase, while IT and ceramics rose 3.3% and 3.2% respectively. In contrast, the jute sector emerged as the worst performer, declining 3%.

Leo ICT Cables PLC has withdrawn its application to raise Tk7 crore from the SME platform of the stock market, stepping back amid political and economic uncertainties ahead of the national election.

According to sources at the Bangladesh Securities and Exchange Commission, the company pulled out its proposal after reassessing market conditions. A senior commission official, speaking on condition of anonymity, said the decision was taken after considering the prevailing political and economic situation.

In October last year, the company had applied to issue seven million shares to raise Tk7 crore from the SME platform. The issue manager for the proposal was AAA Finance & Investment Limited.

The official also said since the current commission has not approved any initial public offerings (IPOs) or Qualified Investor Offers (QIOs) so far, the company likely reassessed the overall situation and decided to step back for now.

The official added that only one SME application is currently pending — that of Brain Station 23 PLC.

Leo ICT Cables had planned to raise funds from the market to expand its production capacity and strengthen its capital base.

The company's paid-up capital stands at Tk32.58 crore. For the year ended 30 June 2025, it reported revenue of Tk37 crore, up from Tk30 crore in the previous year. During the same period, profit after tax rose to Tk5 crore, compared to Tk3.09 crore a year earlier. Earnings per share (EPS) stood at Tk1.67.

According to information available on its website, Leo ICT Cables is a technology-driven manufacturing company in Bangladesh. It produces fiber optic cables, high-quality lithium-ion batteries, and Optical Networking Units (ONU). Its factory is located at Kaliakoir Hi-Tech Park in Gazipur under the Bangladesh Hi-Tech Park Authority.

The company says its fibre optic cables are engineered for high performance, reliability, and durability, forming a critical backbone of Bangladesh's digital and internet infrastructure. It also positions its lithium-ion batteries as efficient, long-lasting, and safe energy solutions, built to meet international standards and support growing power demands.

With modern machinery sourced from global suppliers and a skilled team of engineers and technicians, the company maintains strict quality control and timely delivery for both domestic and international markets. Through its products, Leo ICT Cables aims to contribute to a more connected, sustainable, and technology-driven Bangladesh.

Treasury bill yields have declined again within a month as rising liquidity in the banking sector reduces pressure on government borrowing.

At the latest auction held today (22 February), yields on treasury bills dropped by 40 to 59 basis points compared with January, with rates falling across all three tenors.

The interest rates on 91-day treasury bills stood at 10.02%, down from 10.42% on 5 January. The 182-day bills were auctioned at 10.11%, compared with 10.54% in January, while the 364-day bills fell to 10.07% from 10.66%.

Treasury bills are short-term government securities sold for periods ranging from 91 to 364 days.

Md Ezazul Islam, director general of the Bangladesh Institute of Bank Management, attributed the decline primarily to two factors.

Why T-bill interest rate crosses 10% again?

He said the Bangladesh Bank has been purchasing foreign currency reserves from commercial banks through auctions, thereby injecting liquidity into the banking system.

"Because the central bank is buying dollars from commercial banks, money is flowing back to the banks, leaving them with ample liquidity," he said.

According to Bangladesh Bank data, the central bank has purchased $5.39 billion from commercial banks through auctions in the current fiscal year.

Ezazul added that slower growth in private sector credit was the second key reason behind the fall in yields, as banks now have surplus funds. Latest data from the Bangladesh Bank show that private sector credit growth stood at 6.10% in December.

A deputy managing director of a private bank said the "massive liquidity" in the banking sector has driven down treasury bill yields, noting that dollar purchases by the central bank have increased liquidity through banking channels.

He also pointed out that deposits in the banking sector have increased compared with earlier periods, further improving liquidity conditions.

Treasury bill yields near 10% amid higher govt borrowing

Another senior official of a private bank said government borrowing has declined as implementation of the Annual Development Programme (ADP) remains slow.

In the first seven months (July-January) of the current 2025-26 fiscal year, ADP expenditure totalled Tk50,556.29 crore – the lowest in nine fiscal years. Spending has even fallen significantly compared with the period of political instability and government transition last year.

In September 2025, treasury bill yields had dipped below 10%. At that time, the interest rate on 10-year treasury bonds fell by 246 basis points within three months, marking the first time in two years that the rate dropped below the 10% threshold.

The Bangladesh Bank (BB) has allowed banks to facilitate the business recovery of struggling borrowers by easing down payment requirements and extending implementation deadlines under its policy support schemes.

The BB issued a circular in this regard yesterday, saying the decision was taken following applications from various banks and stakeholders seeking flexibility in implementing earlier policy instructions.

Senior bankers welcomed the decision, saying it could help distressed industries regain momentum. But they also warned that some wilful defaulters might try to exploit the softer terms.

Under the revised rules, eligible borrowers may now pay their required down payment in instalments. Half of the stipulated amount must be paid at the time of approval, with the remaining 50 percent due within six months of the effective date.

The BB also said that if policy support has already been approved but could not be implemented due to valid reasons, banks may extend the previously fixed deadline by up to three months. In addition, regarding interest-related issues, banks have been instructed to make decisions in line with existing policies, based on banker-customer relationships and applicable guidelines.

In January last year, the central bank formed a five-member committee, led by the executive director of the Department of Offsite Supervision, to provide necessary policy support for restructuring or rescheduling corporate borrowers who defaulted due to factors beyond their control.

The committee’s process of holding tripartite meetings with borrowing institutions or groups and financing institutions concluded on September 30 last year.

On September 16, the BB issued a unified special loan rescheduling policy to maintain economic growth and assist borrowers who had defaulted due to circumstances beyond their control.

About 300 companies, including top defaulter conglomerates, applied to the BB for loan rescheduling or restructuring facilities totalling around Tk 2 lakh crore in the first nine months of last year.

Syed Mahbubur Rahman, managing director and CEO of Mutual Trust Bank Ltd, said the flexibility by the BB may help sick industries recover and return to business in this tough time. The economy is going through stress, he said.

However, bankers cautioned that wilful defaulters may take advantage of the policy support extended to enable sick and affected firms to return to business. As the provision has become general, there is a risk that wilful defaulters and those who did not qualify earlier will receive the support.

Anis A Khan, a former chairman of the Association of Bankers, Bangladesh (ABB), said this would give breathing space to affected businesses to restore their production and services to normal levels after the formation of an elected government.

“It is imperative that businesses take this opportunity to rebuild their frayed infrastructure,” he said.

Bangladesh Bank has purchased $5.38 billion from the foreign exchange market so far in fiscal year 2025-26, reflecting continued efforts to manage liquidity and stabilise the exchange rate.

The central bank bought $123 million from eight commercial banks at a cut-off rate of Tk 122.30 per US dollar yesterday.

With the latest intervention, total dollar purchases in February reached $1.448 billion.

The central bank has been buying the US dollar in recent months amid improved inflows and easing pressure on the foreign exchange market.

Between FY21 and FY25, Bangladesh Bank sold more than $25 billion from its foreign exchange reserves to meet import payments for fuel, fertiliser and food.

However, it has resumed purchasing dollars since the beginning of the current fiscal year as supply increased on the back of higher export earnings and remittance inflows.

Since July, the taka has appreciated against the US dollar.

The country’s foreign exchange reserves have continued to rise due to the central bank’s steady dollar purchases.

Reserves stood at $30.06 billion on February 19 this year, as per the International Monetary Fund (IMF) calculation, up from $20.79 billion on the same date a year ago, according to Bangladesh Bank data.