India has further ​raised a windfall tax on exports of ‌diesel and aviation turbine fuel it imposed last month to ensure adequate domestic supply.

In a government notification on ​Saturday, India's finance ministry increased the tax ​on diesel exports to 55.5 rupees per ⁠litre from 21.5 rupees per litre, and on ​exports of aviation turbine fuel to 42 rupees ​per litre from 29.5 rupees per litre, effective immediately.

India also last month cut excise duty on petrol and diesel by ​10 rupees ($0.11).

Separately, to control a rise in airfares, ​it has also capped a monthly increase in aviation turbine ‌fuel ⁠prices for domestic airlines at 25% in April. Jet fuel accounts for up to 40% of an airline's expenses.

Global oil prices have surged past $100 ​per barrel ​as the ⁠flow of oil through the Strait of Hormuz, which serves as a conduit ​for 40% of India's crude oil ​imports, ⁠remains heavily restricted due to the US-Iran war.

India, which ranks among the top five refining nations globally and ⁠is ​also the world's third-biggest oil ​importer and consumer, relies heavily on overseas supplies.

Eastern Bank PLC (EBL) has signed a memorandum of understanding (MoU) with the Mongla Port Authority (MPA) to introduce advanced digital banking services at Mongla port.

Md Jabedul Alam, head of transaction banking at the bank’s corporate banking division, and AKM Anisur Rahman, member (engineering and development) of MPA, signed the MoU recently at Mongla port in Bagerhat, according to a press release.

The partnership aims to improve the efficiency of financial transactions at the port by implementing secure, modern and seamless digital payment and collection solutions.

Under the initiative, EBL and MPA will jointly develop a comprehensive digital ecosystem, enabling port users to carry out transactions smoothly through the bank’s digital banking platform.

Among others, Captain Mohammad Shafiqul Islam, harbour master of the MPA; Md Kamal Hossain, deputy secretary (director, traffic); Md Mahfuzur Rahman, deputy chief finance and accounting officer; Md Fazle Alam, chief audit officer; Lt Col Md Arif Billah, chief engineer (mechanical and electrical); and Mohammad Arif Chowdhury, head of cash management at EBL’s transaction banking division, were also present at the event.

The Asian Development Bank (ADB) has cut Bangladesh’s economic growth further to 4 percent for the current fiscal year 2025–26 from its previous projection of 4.7 percent amid a fuel price spike and disruption in global supply chains due to the war in the Middle East.

The ADB said the economy might pick up and grow by 4.7 percent in the next fiscal year 2026–27, according to the latest Asian Development Outlook (ADO) April 2026 released today.

This is the third time the ADB has revised down its Gross Domestic Product (GDP) growth forecast for Bangladesh.

The Manila-based lender in December forecast 4.7 percent GDP growth in the current fiscal year, down from its September forecast of 5 percent. In April last year, the ADB had projected 5.1 percent growth for the same year.

The current growth outlook reflects a recovery in consumption and investment as political uncertainty eases after the general election. Temporary supply chain disruptions linked to conflict in the Middle East affected activity in the last quarter, but their impact is expected to fade, the ADB said in a press release.

“Bangladesh is facing a difficult economic environment, shaped by global uncertainties, domestic structural constraints, and pressures on the external and financial sectors,” said ADB Country Director in Bangladesh Hoe Yun Jeong.

Inflation is projected to remain elevated at 9 percent in FY26, despite some easing, reflecting persistently high global energy prices and ongoing supply disruptions. It is expected to moderate to 8.5 percent in FY27 as external shocks subside and domestic supply conditions improve.

“Downside risks to the outlook remain substantial, particularly if the conflict prolongs,” it said.

Disruptions to global energy markets, shipping routes, and supply chains could drive sustained increases in oil and gas prices, intensifying domestic inflationary pressures and complicating ongoing disinflation efforts, thereby constraining macroeconomic policy flexibility, it said.

“Higher energy prices could also widen the fiscal deficit, especially if energy-related subsidies increase or the pass-through to consumers is delayed.”

The ADO report said external sector pressures may rise as exports and remittances soften amid slower economic activity in key Persian Gulf economies, while elevated import costs and freight rates would further strain the current account amid already tight external liquidity.

Overall, the balance of risks is firmly tilted to the downside, underscoring Bangladesh’s vulnerability to external shocks in a context of still-fragile macroeconomic conditions. Climate-related shocks remain an additional, persistent risk.

The ADB said the current account deficit, the record of a country's international transactions with the rest of the world, is anticipated to be 0.5 percent of Gross Domestic Product in FY26, widening slightly to 0.6 percent in FY27, driven by stronger import demand and a broader trade deficit.

The dollar slipped on Friday, putting it on track for its largest weekly drop ​since January, as investors sold safe-haven assets on the assumption that oil shipping will resume if a ceasefire holds in the ‌Gulf.

The dollar had towered in March as one of the few bastions of safety as the Iran war sent oil prices surging and hit stocks and gold, while inflation worries pressured bonds.

But since a fragile ceasefire was reached on Tuesday, those positions are being unwound.

The euro has rallied 1.8 percent this week to trade at $1.173, while sterling ​has gained 2 percent since Monday to $1.347.

The risk-sensitive Australian and New Zealand dollars are set for weekly rises of nearly 3 percent on ​the dollar, with the Aussie trading just above 70 cents.

MARKETS ARE OPTIMISTIC EVEN THOUGH CEASEFIRE IS FRAGILE

“The market still seems generally optimistic, despite some of the ceasefire fraying,” said Marc Chandler, chief market strategist at Bannockburn Global Forex.

Data on Friday showed ​that US consumer prices rose by the most in nearly four years in March as the Iran war boosted oil prices and the pass-through from tariffs ​persisted.

The increase was largely in line with expectations and the markets’ direction is more likely to hinge on the outcome of weekend peace talks between the US and Iran in Islamabad, analysts said.

“People were buying the US dollar when the war was at its most intense moment and now they’re selling as the tail risk ​of a really bad outcome has faded quite a bit,” said Jason Wong, senior strategist at BNZ in Wellington.

“Even though it still looks ​a bit shaky, the ceasefire removing that tail risk is important from a sentiment point of view,” he said, adding that the mood could turn very quickly ‌if the ⁠anticipated weekend peace talks fail to deliver progress.

Asia’s biggest liquefied petroleum gas (LPG) importers, including India and China, are racing to replace disrupted Middle East supplies with cargoes from the ​Americas, driving spot premiums to record highs, analysts and traders said.

LPG exports from the Middle East, Asia’s top supplier of the ‌fuel used for cooking and feedstock for petrochemical plants, have plunged since the US-Israeli war with Iran started in late February.

The supply shock is squeezing Asian petrochemical producers’ margins, forcing them to cut output, and raising costs for millions of Asian households, analysts and traders said. India and China are the biggest importers of LPG from the Middle East.

Middle Eastern ​LPG exports tumbled 73 percent to 419,000 barrels per day (bpd) in March from the previous month, data from analytics firm Kpler showed,

The supply shock ​drove spot premiums for propane and butane loading in April from the Gulf to record highs of $250 per metric ton to March Saudi contract price swaps on March 30, according to pricing agency Argus.

Saudi Aramco sharply raised its April official selling prices amid the supply crunch. The ​April propane price rose by $205 per ton to $750, while butane increased by $260 per ton to $800.

“Key importers such as India are actively diversifying their sourcing strategies, increasing ​procurement from the United States, Norway, Canada, and other regions alongside remaining Gulf supplies,” said Vasudev Balagopal, global head of petrochemical trading at financial services platform Marex.

ALTERNATIVE SUPPLY

To meet Asia’s shortfall, US LPG exports are expected to surge to a record 2.7 million bpd in April, with about 1.8 million bpd headed to Asia, 14 percent higher than March, preliminary Kpler ​data showed. That drove US Gulf spot terminal fees for propane and butane to a record $273.525 and $240.09 per ton, respectively, on March 19, Argus data ​showed.

“We saw some additional propane still being offered to Asia for May arrivals,” said Marex’s Vasudev.

However, Greg Bower, a broker at New Stone, said the US cannot replace the ‌Middle East fully, adding that export terminals were already operating close to capacity before the conflict.

According to US Energy Information Administration data, the country had 48.4 million barrels of ready-for-sale propane as of March 27.

Moreover, transit times from the US Gulf Coast to Asia take more than 30 days, significantly longer than a two-week voyage from the Middle East, traders said, adding to supply strains amid uncertainty over when Iran will allow the strategic Strait of Hormuz to reopen as part of a fragile ​ceasefire deal.

Last year, the Middle East ​accounted for about 48 percent of total Asian LPG imports at 1.54 million bpd, while the US sent about 39 percent or 1.26 million bpd, Kpler data showed.

LOSS IN DEMAND

Insufficient LPG supply led to demand destruction in March, analysts said.

Consultancy Rystad Energy estimated LPG demand loss from ​regional steam crackers at about 135,000 barrels per day in March from February levels, with a further 35,000 ​bpd decline expected in April and 11,000 bpd in May.

In China, propane dehydrogenation (PDH) plants, already operating at around 60 percent to 65 percent before the conflict because of poor margins, are expected to trim runs by a further five percentage points in April due to feedstock shortages, according to Rystad. Such plants product propylene, a key building block for plastics and other chemicals.

For ​cooking gas, India’s demand dropped around 205,000 bpd in March.

“The supply situation in India is ​gradually improving but shortages persist even as long-haul cargoes arrive in India from as far as Argentina and the US,” Rystad analyst Manish Sejwal said.

Rystad expects Indian LPG demand to recover from April, ​with losses narrowing by about 70,000 bpd.

Wall Street stocks rose sharply over the week and oil prices fell as a fragile truce was struck between the United States and Iran, with ceasefire talks due to start in Islamabad on Saturday.

For the week, all three major US indices advanced by more than three percent. Oil prices retreated once again on Friday. For the week, they tumbled by approximately 13 percent.

The New York Stock Exchange closed mixed for the day Friday -- the Dow Jones shed 0.6 percent, the Nasdaq gained 0.4 percent, and the broader S&P 500 index was flat, slipping 0.1 percent.

"Markets are trading on a cautious tone ahead of the US-Iran ceasefire talks," Elias Haddad of Brown Brothers Harriman (BBH) said in a note.

"For financial markets, the key issue is whether peak shipping security fear is now behind us."

Official sources say the talks in Islamabad will cover Iran's nuclear enrichment and the free flow of oil through the Strait of Hormuz.

Since the ceasefire took effect, US President Donald Trump has voiced displeasure at Iran's handling of the strategic strait, which was meant to be reopened.

"The key issue for the oil market is whether ship traffic through the Strait of Hormuz will resume," Carsten Fritsch of Commerzbank said in a note. "So far, there are no signs of this happening."

Inflation in the United States rose sharply in March, government data showed Friday, as higher energy prices due to the war hit Americans hard. Prices rose 3.3 percent from a year earlier.

White House spokesperson Kush Desai responded by saying the US economy "remains on a solid trajectory."

In Europe, London and Frankfurt closed virtually flat as Paris added 0.2 percent.

The Real Estate and Housing Association of Bangladesh (Rehab) has requested the opportunity to invest undisclosed money (black money) into the country's housing sector at a lower tax rate and without any questioning of the source.

The proposal was presented today (8 April) during a pre-budget discussion held at Agargaon in the capital.

Md Wahiduzzaman, president of Rehab, and Liakat Ali Bhuiyan, vice president of Rehab, highlighted the current state of the sector during the session.

In a written statement, the organisation urged "reintroducing the previous provision in the Income Tax Ordinance stating that no authority shall raise any questions regarding the source of funds for general buyers when purchasing flats."

Liakat Ali Bhuiyan, vice president of the organisation, stated, "Expatriates often do not provide a declaration after sending money, which then becomes undeclared or 'black money.' If they are not allowed to buy flats with this money, the capital is being siphoned abroad."

In response, NBR Chairman Abdur Rahman Khan said, "We have been in this culture for 55 years; we will not remain in it anymore."

Highlighting that it is now very easy to send money from abroad and that the government even provides incentives for using formal channels, he added, "Therefore, expatriates will whiten their money by paying taxes at the regular rate. It cannot be addressed in any other way."

In the 2020-21 fiscal year, the government introduced a provision allowing the investment of undisclosed money in the housing sector without any questions from authorities.

At that time, while general buyers paid up to 30% tax, the tax for investing black money was only 10%.

This provision faced widespread criticism, leading the government to gradually move away from this path.

Currently, there is no opportunity for a reduced 10% tax rate in the housing sector. Investors must pay the regular tax rate plus a penalty on that tax.

Additionally, the Anti-Corruption Commission (ACC) or any other government agency retains the right to question the source of the invested funds.

In addition to the demand regarding undisclosed money, Rehab's proposal included reducing existing registration costs for flat or apartment sales as well as providing special incentives to develop a secondary market for housing.

The World Bank projects lower economic growth for Bangladesh in the current fiscal year, stating that 12 lakh poor people will remain below the poverty line mainly due to the impact of the US-Israel war on Iran.

Today, the multilateral lender published its Bangladesh Development Update for April, a bi-annual publication of the World Bank.

Poverty and welfare outcomes deteriorated over 2022–25, driven by limited creation of productive jobs, weak labour income growth, and elevated inflation that reduced the poverty-reducing impact of growth, the lender said in its report.

Bangladesh’s national poverty rate is projected to have risen for a third consecutive year, increasing from 18.7 percent in 2022 to 21.4 percent in 2025.

Prior to the conflict in Middle East, about 1.7 million people were projected to get out of poverty this year, but due to conflict, now only 0.5 million people can exit poverty.

At the $3 international poverty line, an additional 1.4 million people are projected to have fallen into poverty over the same period, it added.

“A recovery projected for 2026 is now at risk — the Middle East conflict is expected to push an additional 1.2 million people below the poverty line, offsetting much of the projected improvement.”

The conflict is likely to materially affect Bangladesh’s economy, compounding existing vulnerabilities such as elevated inflation, financial sector struggles, constrained policy space, and weakened confidence.

Higher import costs, weaker exports, and falling remittances would add pressure to the current account balance, while rising energy prices and exchange rate pressures would further fuel inflation. Higher energy subsidies would also squeeze fiscal space.

Addressing these risks demands a coherent stabilisation strategy — backed by structural reforms — to build buffers, restore confidence, revive investment, and put growth on a sustainable footing.

The World Bank has downgraded Bangladesh’s near-term outlook, revising real GDP growth for FY26 down to 3.9 percent from the previous projection of 4.6 percent in January 2026.

The downward adjustment reflects the combined impact of the ongoing Middle East conflict and persistent domestic macroeconomic challenges, including elevated inflation, weak investment, and financial sector vulnerabilities.

Inflation is expected to moderate compared to FY25 but remain elevated due to higher import and energy costs linked to the conflict.

Bangladesh’s foreign exchange (forex) market remains stable and there is no immediate pressure to devalue the Taka, according to a recent assessment by Bangladesh Bank.

The central bank said despite some media reports suggesting a possible devaluation, the supply and demand for foreign currency are currently balanced.

As of April 6, 2026, the banking sector holds around $3.9 billion in foreign currency liquidity, up from $2.3 billion at the end of February 2026.

Cash holdings of foreign currency in banks also rose slightly, from $47.6 million on February 26 to $49 million by April 6.

Bangladesh’s foreign exchange reserves currently stand at approximately $34.35 billion.

Central bank officials noted that reserves could have approached $36 billion if Bangladesh Bank had actively purchased dollars to maintain market liquidity.

Notably, the central bank has not bought any dollars from the market over the past month, even though banks’ Net Open Position (NOP) reached about $1 billion—well above the usual $600–700 million threshold that typically prompts such purchases.

The market stability is supported by a surge in remittance inflows.

In March 2026, Bangladesh received $3.775 billion in remittances—the highest for any single month to date. This trend has continued into April, with $660 million received in the first six days, a 20.5 percent increase compared to the same period last year.

Foreign payments continue to be regular and well-managed.

In the past month, Bangladesh settled $1.37 billion in Asian Clearing Union (ACU) bills. Additionally, around $180 million in government foreign debt has been repaid recently.

The central bank stated that the forex market is operating under normal mechanisms, without significant value-based pressure on the dollar. Strong remittance flows and disciplined market behavior continue to ensure a secure foreign exchange environment.

Shahjalal Islami Bank has reported a sharp rise in profitability for 2025, driven by strong growth in investment income and improved operational performance, while announcing a higher cash dividend for its shareholders.

According to the bank's latest price sensitive disclosure, its consolidated net profit surged 118% year-on-year to Tk368 crore in 2025, up from Tk169 crore in the previous year.

The robust earnings performance lifted consolidated earnings per share (EPS) to Tk3.31, compared with Tk1.52 a year earlier.

The bank also reported improved financial strength, with consolidated net asset value per share rising to Tk23.07 from Tk21.09 in 2024. Meanwhile, consolidated net operating cash flow per share increased to Tk12.28 from Tk8.03, reflecting stronger cash generation from core operations.

On the back of this improved performance, the board of directors recommended a 13% cash dividend for the year, up from 10% cash dividend declared in 2024. The decision was taken at a board meeting held today (8 April).

The bank attributed the strong profit growth mainly to higher net investment income, increased earnings from shares and securities, and a rise in other operating income. Improved cash flow was supported by higher investment income and increased placements with banks and financial institutions.

To approve the audited financial statements and dividend, the bank has scheduled its annual general meeting for 24 May, with the record date set for 30 April.

Market analysts view the strong earnings growth and higher dividend as positive signals for investors, particularly at a time when the banking sector is navigating various economic challenges.

The bank's shares responded positively on the Dhaka Stock Exchange, rising 2.29% today to close at Tk17.90.

As of March, sponsor-directors held 43.08% of the bank's shares, while institutional investors owned 24.25%. General investors accounted for the remaining 32.67%, indicating a balanced ownership structure.

Bangladesh’s national flag carrier, MV Banglar Joyjatra, sailed towards the Strait of Hormuz this noon—after being stranded in the Persian Gulf for 39 days—aiming to cross the route during the two-week ceasefire agreed between the US and Iran.

Bangladesh Shipping Corporation (BSC) Managing Director Commodore Mahmudul Malek confirmed the development at a press conference in Chattogram today.

A total of 31 Bangladeshi crew members are on board the vessel, which had been stranded in the Persian Gulf since the war began on February 28.

Malek said the ship went to Saudi port Ras Al-Khair three days ago and, after loading fertiliser, remained anchored at the outer anchorage of Dammam Port.

As Iran announced it would guarantee safe passage for maritime traffic through the Strait of Hormuz for two weeks following the ceasefire, the vessel left the anchorage and is now heading towards the Strait, he said.

The ship will first reach a safe location and will cross the Strait once BSC gives further instructions after monitoring the situation, Malek added.

The vessel is carrying 37,000 tonnes of fertiliser.

When contacted via WhatsApp, the ship’s chief engineer, Rashedul Hasan, told The Daily Star that they lifted anchor around 9:00am local time (12:00pm Bangladesh time) after receiving instructions from BSC.

“We are now heading towards the Strait of Hormuz at a speed of 12 nautical miles per hour,” he said.

The chief engineer added that the vessel is about 420 nautical miles away from the Strait and, at the current speed, it will take around 40 hours to reach and cross it.

The BSC managing director said the ship’s charterer has initially set three possible destinations: South Africa, Mozambique, and Brazil. Once the destination is finalised, the vessel will proceed accordingly, he said.

The bulk carrier arrived at the United Arab Emirates port of Jebel Ali on February 27 from Mesaieed, Qatar, carrying 38,800 tonnes of steel coils before becoming stranded.

The National Board of Revenue (NBR) is considering linking VAT registration – known as a Business Identification Number (BIN) – to bank accounts, aiming to bring businesses with trade licences but without VAT registration under the tax net.

Under the proposed measure, businesses may be required to provide a BIN when opening or continuing current accounts in banks. According to NBR sources familiar with the budget, a provision in this regard may be included in the upcoming national budget.

If fully implemented, the policy could compel tens of thousands of small and large businesses to register for VAT, with the primary goal of expanding VAT coverage.

However, business owners and bankers have expressed concerns that mandatory BIN verification for bank accounts could discourage businesses from opening accounts or depositing funds. Many business owners are reportedly reluctant to register for VAT due to bureaucratic complexity and potential harassment.

A senior NBR official, speaking on condition of anonymity, told The Business Standard, "A large number of businesses, which are legally supposed to be under VAT, remain unregistered. To bring them under the tax net, making registration mandatory for opening a current account is being considered."

He added, "If approved by the finance minister, this could be included in the next budget and implemented from the next fiscal year."

Another official noted that even existing account holders may be required to undergo BIN verification.

According to NBR data, there are currently 7,92,000 VAT-registered entities in the country, of which about 5,00,000 file returns.

Estimates from the Bangladesh Shop Owners Association show that nearly 70 lakh shops hold trade licences, while many other businesses and service providers remain outside the VAT net. Moreover, not all of these businesses maintain current accounts.

According to estimates by the Bangladesh Shop Owners Association, nearly 70 lakh shops hold trade licenses, while there are many businesses and service providers that are still outside the VAT net. Not all of these businesses maintain current accounts.

Another NBR official said, "Small-scale businesses with low-value transactions are not our target. This initiative is aimed at businesses with current accounts and significant transaction volumes, to track turnover and ensure applicable VAT is collected."

Regarding concerns that businesses might sidestep monitoring through alternative accounts, the official noted, "Savings accounts have transaction limits. If fully implemented, these loopholes can also be addressed."

Business owners, however, voiced opposition to the plan. Arifur Rahman Tipu, general secretary of the Bangladesh Shop Owners Association, told The Business Standard, "If BIN becomes mandatory for opening or managing bank accounts indiscriminately, businesses may be discouraged from using banks, depositing money, or conducting transactions."

He added, "Forcing small businesses to register for VAT will increase their costs and could potentially drive them out of business. The complexity of the system and harassment discourage registration."

Bankers echoed these concerns. Syed Mahbubur Rahman, managing director and CEO of Mutual Trust Bank Limited, said, "Customers are already hesitant to deposit money due to bank charges and excise duties. Making BIN mandatory for businesses could further discourage account openings, prompting them to keep money elsewhere."

He suggested that the government focus on increasing direct taxes rather than imposing mandatory BIN requirements on bank accounts.

The dollar fell around one percent against the euro and the pound in early European trading Wednesday as investors sold the greenback on relief over a temporary ceasefire between the United States and Iran.

At around 8:10 am (0610 GMT) the dollar, usually a safe investment haven in times of market turmoil, was trading at 1.17 euros, down around 1.1 percent. Against the pound, the dollar fell around 0.9 percent to $1.34.

Rising geopolitical tensions involving Iran, Israel and the United States have already disrupted global energy and food supply chains, and may put additional pressure on Bangladesh's external balance and domestic inflation, according to Bangladesh Bank.

In its Quarterly Report for October-December, published today (8 April), the central bank said the newly elected government, which took office at the end of February, has taken steps to mitigate external vulnerabilities.

These include efforts to diversify crude oil import sources and reduce reliance on the Middle East, it added.

The central bank also said Bangladesh's external sector showed improvement in the second quarter of FY26, driven largely by a surge in workers' remittances. "The current account posted a surplus of $476 million, reversing a deficit of $818 million in the previous quarter."

However, the report mentioned that export performance weakened, particularly in the ready-made garments sector, amid cautious demand in major markets and rising global trade tensions.

At the same time, import payments remained broadly contained amid subdued domestic demand and moderate investment activity, resulting in a slight widening of the trade deficit, it said.

According to the central bank, the financial account recorded a surplus of $329 million, supported by higher foreign direct investment and increased disbursements of medium- and long-term external financing.

Overall, the balance of payments registered a surplus of $1.09 billion, helping boost gross foreign exchange reserves to $33.19 billion ($28.58 billion under BPM6) by the end of December 2025. The exchange rate remained stable under the market-based framework.

The report said inflationary pressures persisted during the quarter. Point-to-point headline inflation rose to 8.49% in December 2025 from 8.36% in September 2025, partly due to higher administered fuel prices.

Food inflation edged up to 7.71%, driven by increased prices of fish, dried fish and fruits. Non-food inflation also rose to 9.13%, reflecting higher energy-related costs, including gasoil. Despite steady nominal wage growth, elevated inflation kept real wages in negative territory, eroding purchasing power, the central bank said.

In the real sector, economic performance was mixed. Agricultural output exceeded both targets and last year's levels, supported by favourable weather and continued policy support.

However, industrial growth slowed sharply to 1.27% during the quarter, down from 6.82% in the previous quarter, it said, adding that the services sector remained resilient, helping sustain overall economic stability.

Despite strong overall GDP growth averaging 6.0% between FY16 and FY25, Bangladesh's private sector performance at the firm level has not kept pace, according to the latest World Bank analysis.

The latest Bangladesh Development Update report, published today (8 April), highlights a "productivity paradox," where aggregate growth has not translated into widespread innovation or productivity gains across businesses.

According to the report, revenue per worker in manufacturing and services is only about one-third of the South Asian benchmark. Productivity growth in services, the largest employer in the economy, has remained stagnant since 2016, highlighting persistent inefficiencies.

The report states that only 8% of formal firms were established in the past five years in Bangladesh, compared to 32% in China and 40% in Vietnam. This points to a shrinking pipeline of new enterprises and limits opportunities for economic diversification and innovation.

The report said private investment has fallen since 2013, particularly among smaller firms. Foreign direct investment remains below 1% of GDP and is concentrated in utilities rather than sectors like manufacturing or market services, where technology spillovers could drive productivity and job creation.

The economy has grown, but most gains have accrued to a small group of firms, leaving the broader private sector largely stagnant, the report notes.

The findings underscore the need for targeted reforms to foster innovation, support small and medium enterprises, and attract investment in high-productivity sectors to create more inclusive growth.

European natural gas prices plunged 20 percent at the start of trading Wednesday in the wake of a two-week ceasefire agreed between the United States and Iran.

The Dutch TTF natural gas contract, considered the European benchmark, slumped to 42.5 euros, retreating from highs seen over fears of supply disruptions in the Gulf from the war.

Ongoing geopolitical tensions pose near-term risks to Bangladesh's price stability, export demand and import costs, the central bank says in the wake of the worst ruckus in the Mideast.Bangladesh economic report

The Bangladesh Bank (BB) has painted such a picture on the economic downside in its latest Bangladesh Bank Quarterly (BBQ) report for October-December 2025, while listing upside positives, too.

"Rising geopolitical tensions -particularly the Iran-Israel-USA conflict--have already disrupted global energy and food-supply chains and may exert additional pressure on both the external balance and domestic inflation," reads the BBQ, released Wednesday.

"Proactive policy measures to maintain macroeconomic stability remain central to managing these challenges," the central bank suggests, adding that continued policy coordination and ongoing reforms in the financial and external sectors are expected to support economic resilience in the quarters ahead.

The BBQ, however, notes that the newly elected democratic government, which took office at the end of February, has initiated several measures to mitigate external risks, including efforts to diversify crude-oil-import sources and reduce reliance on the Middle East.

Ongoing conflicts in the Middle East have heightened the risk of volatility in global oil markets and exchange rates, according to the BBQ.

"For energy-importing economies like Bangladesh, rising global oil prices may incur increased import payments, thereby depleting foreign- exchange reserves and creating upside risks to inflation in the country," the regulator alerts.

On the other hand, global oil-price shock may induce the domestic currency exchange rate to depreciate, which is also inflationary in nature.Personal finance consulting

"The inflationary pressure on the economy may not ease in the coming months due mainly to the ongoing geopolitical tensions that would possibly push up overall import costs," Md. Ezazul Islam, Director- General of Bangladesh Institute of Bank Management (BIBM), told The Financial Express (FE), while replying to a query.

Dr Islam, also a former executive director of the central bank, says earnings from both exports and remittances may also face setback in the coming months if the tension prolongs further, which would accelerate the deficit in the current account of the country's overall balance of payments.

The pace of economic activity showed volatility in the first half of the current fiscal year (FY), 2025-26, with alternating quarters of stronger and relatively weaker growth.

Real GDP (gross domestic product) growth decelerated in the second quarter (Q2) of FY'26 compared to the previous quarter, while inflation remained elevated.

"Overall, the latest indicators suggest that Bangladesh's macroeconomic conditions remained broadly stable despite persistent domestic and external challenges," the central bank notes.

In the real sector, economic activity showed a mixed performance, according to the BBQ.Market insights report

The central bank also says agricultural production recorded strong performance during the quarter, exceeding both official targets and the previous year's output levels, reflecting benign weather conditions and continued policy support.

In contrast, industrial activity fell considerably, recording 1.27-percent growth in the quarter under review, down from 6.82 per cent in the previous quarter, the BBQ mentions.

Services-sector activities remained robust, helping in maintaining overall economic stability.

Monetary conditions remained tight as the central bank continued its contractionary-policy stance to contain inflation and support macroeconomic stability.

The policy-rate and-interest-rate corridor remained unchanged, keeping the weighted average call money and interbank repo rates close to the 10.00-percent policy rate by the end of December 2025, according to the BBQ.

Meanwhile, the banking sector's asset quality appeared to improve during the Q2 of FY'26, as the gross non-performing loan (NPL) ratio declined to 30.60 per cent from 35.73 per cent three months before.Bangladesh economic report

"However, this improvement largely reflects recent regulatory relaxation rather than a fundamental strengthening of credit quality," the BBQ explains.

The central bank also says renewed depositor confidence, steady advances amid cautious lending, and tighter monetary policy contributed to a decline in the advance-deposit ratio, reflected in the adequate liquidity position.

Regarding external sector, the BBQ says the external sector improved during the period under review, supported mainly by a surge in worker remittances, which helped the current account return to a surplus of US$476 million, reversing the $818-million deficit recorded in the previous quarter.

However, export performance weakened during the quarter, particularly in the ready-made garment sector, reflecting cautious demand from major markets and rising global trade tensions, the central bank notes.

At the same time, import payments remained broadly contained amid subdued domestic demand and moderate investment activity. As a result, the trade deficit widened slightly.

In a move to lower financing costs and enhance global competitiveness, the Bangladesh Bank is set to introduce offshore dollar loans for exporters at a significantly lower interest rate.

Under the proposed scheme, exporters will be able to borrow at an interest rate of 8%, substantially lower than the prevailing 14% to 16% charged on local currency loans. The central bank is expected to issue a circular shortly outlining the operational framework, officials said.

Exporters would be permitted to use the funds for day-to-day business expenses, including utility payments, wages, and other working capital needs. The loans will be repaid from export proceeds in foreign currency, reducing pressure on the domestic banking system.

The facility will also allow exporters to convert the borrowed dollars into the taka through currency swaps with their banks if needed, without incurring additional interest costs.

Providing exporters with such facilities will enhance their financial capacity. Consequently, this is expected to bolster their competitiveness in the international market while easing the pressure on the country's foreign exchange reserves.

According to central bank officials, the loan amount will be linked to export orders. "For instance, if an exporter secures an order worth $100 and opens a letter of credit (LC) for $60 to import raw materials, they may borrow up to $40 under the offshore facility to meet remaining operational expenses," an official told The Business Standard.

Banks will be allowed to extend these loans based on their relationships with clients, with maturities ranging from three months to one year, he said, adding that no strict cap on lending has been imposed, giving banks flexibility to assess client needs.

"Currently, there is an opportunity to take this type of loan from the banking system, but it must be taken in the taka and the interest rate is 14% or more. The main objective of providing the facility to take loans from offshore banking at 8% interest is to increase the competitiveness of exporters and support them," the official said.

The Bangladesh Bank will instruct banks to provide short-term foreign currency loans to exporters from offshore banking units, based on established banker-customer relationships.

No further credit limits or additional conditions will be imposed on the banks. Depending on the specific requirements of the customer, banks may extend these loans for a tenure of three months to a maximum of one year.

The initiative follows a reduction in the Export Development Fund from $7 billion to $2.2 billion, a move necessitated by conditions under the International Monetary Fund programme. This reduction has significantly curtailed exporters' access to existing low-cost foreign currency financing.

What experts say

Speaking to TBS, economists and business leaders have welcomed the move, noting that exporters are facing increasing pressure due to declining global demand and rising production costs. They believe the new facility will help improve liquidity, reduce financing costs, and encourage investment.

However, experts have also highlighted risks. If export earnings are not repatriated, loan recovery could become difficult. In addition, exchange rate fluctuations could increase the repayment burden in local currency terms if the taka depreciates.

Mahmud Hassan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association, said at a time when the country's export earnings are consistently declining, such an initiative to bolster export capacity and support exporters is a highly positive step. However, he noted that the interest rate for these loans should be lower than 8%.

"Currently, when borrowing in dollars from the Bill Transformation Fund and the Technological Development Fund, the interest rate is 5%. Therefore, it is only logical that the interest rate for loans from offshore banking be set at 6% or 7%," he argued.

Syed Mahbubur Rahman, managing director and CEO of Mutual Trust Bank, said exporters would naturally benefit if working capital credit facilities were provided through offshore banking. He noted that as businesses are currently facing a crisis, the Bangladesh Bank is introducing this facility to compensate for the reduction in credit available from the Export Development Fund.

"Once this offshore banking facility is launched, instead of borrowing for back-to-back LCs, exporters will opt for these lower-interest loans. However, the significant risk here is that the exports must be executed against the orders, and the export proceeds must be repatriated to the country," he added.

While welcoming the move, Fahmida Khatun, executive director of the Centre for Policy Dialogue, advocated for a rigorous vetting process to select eligible borrowers and ensure that these loans are not misused.

"Bangladesh's foreign exchange reserves stand at approximately $30 billion. If monthly import costs average $5 billion, it is possible to cover six months of import expenses. Therefore, it is crucial to safeguard our foreign currency and ensure it is not squandered under any circumstances," she said.

Zahid Hussain, former lead economist at the World Bank's Dhaka office, also viewed the decision to lift existing restrictions on loan disbursements from offshore banking as a positive move. He added that allowing loan distribution and currency swap facilities based on banker-customer relationships is also a logical step.

"However, if there is a significant depreciation of the taka due to exchange rate fluctuations, borrowers will have to repay a higher amount in local currency terms. The resulting additional liability must be borne by the borrowers themselves. It is crucial to ensure that they do not seek incentives or assistance from the Bangladesh Bank when such situations arise," he added.

Audit reports of two listed companies – Silva Pharmaceuticals and Associated Oxygen – have identified inconsistencies in IPO fund utilisation, alongside delays and compliance gaps, according to stock exchange disclosures today.

For Silva Pharmaceuticals, the audit of IPO proceeds utilisation up to 28 February 2026 found that the company exceeded its approved budget for civil construction. Expenditure in this segment rose to Tk6.53 crore, or 104.26% of the allocated amount, resulting in excess spending of around Tk24 lakh without prior approval from shareholders or the regulator.

The report also highlighted a fund reallocation decision taken at the company's 9th Extraordinary General Meeting (EGM) on 30 December 2025, under which approximately Tk2.81 crore of unutilised funds from the "Machinery and Equipment" segment were transferred to working capital. However, no specific timeline for this reallocation was disclosed.

So far, 76.99% of the machinery allocation has been utilised, with the remaining funds shifted to working capital. The company has also fully utilised Tk9.9 crore earmarked for loan repayment and Tk2.44 crore for IPO-related expenses.

However, auditors observed inconsistencies in the use of working capital, noting that around Tk0.49 crore – 17.39% of the unspent portion – had been utilised in a manner not fully aligned with the original plan, despite EGM approval.

Overall, while IPO proceeds were largely used in line with the prospectus, auditors flagged deviations including excess construction spending, unclear fund reallocation, and partial inconsistencies in working capital use. The report also noted that utilisation was not completed within the originally stipulated timeline.

Meanwhile, Associated Oxygen has made substantial progress in utilising its IPO funds but faces issues related to deadlines and regulatory compliance. As per its prospectus, the deadline for submitting IPO utilisation reports expired in October 2022.

The company applied twice for deadline extensions; the first request was partially approved, while the second was rejected by the Bangladesh Securities and Exchange Commission (BSEC).

Associated Oxygen raised Tk15 crore through its IPO in September 2020.

Overall, auditors said that although both companies largely adhered to their stated objectives in using IPO proceeds, gaps remain in governance, timeline compliance, and fund management. Addressing these issues through proper approvals and disclosures will be crucial to maintaining investor confidence.

The securities regulator has fined the directors and top executive of Rupali Insurance Company Limited for violating credit rating regulations, highlighting ongoing concerns over compliance and governance practices in the capital market.

According to the latest monthly enforcement report of the Bangladesh Securities and Exchange Commission (BSEC), 11 individuals—including directors and the chief executive officer—were each fined Tk1 lakh in March.

The penalised persons are Mostafa Golam Quddus, Ali Ahmed, Mohammad Yonus, Quazi Moniruzzaman, KM Faruk, Abu Hena, Shaon Ahmed, Obaidul Huque, Mostafa Quamrus Sobhan, Fazlutun Nessa, and CEO Fawzia Kamrun Taniyas.

However, Quddus, the former chairman of the company, passed away in January 2025, while some of the penalised individuals are no longer actively engaged with the company.

The BSEC said in the report that the penalty stems from irregularities related to the company's credit rating process and alleged violations of the Bangladesh Securities and Exchange Commission (Credit Rating Companies) Rules, 2022.

The regulator found inconsistencies in an agreement between the insurer and Credit Rating Information and Services Limited (CRISL), particularly the absence of a clear validity period and execution date.

Under the agreement, CRISL was responsible for conducting an initial credit rating for 2018 and surveillance ratings for subsequent years. While the firm completed ratings up to 2020, the validity of its last rating report expired on 28 November 2022.

Immediately after this expiry, Rupali Insurance entered into a new agreement with National Credit Rating Limited on 29 November 2022, and a fresh rating report was issued in December based on updated financial statements.

The BSEC concluded that engaging a new rating agency without formally terminating the previous agreement or securing regulatory approval breached rules governing the continuity and termination of credit rating engagements.

The rules require that once a rating agreement is executed, it must continue through the initial rating and three consecutive surveillance ratings unless formally terminated with the commission's approval.

During the hearing, Rupali Insurance and the accused individuals contested the allegations, arguing that the agreement with CRISL had naturally expired rather than being terminated. They also claimed the previous agency failed to deliver within the stipulated timeframe, necessitating a new rating to meet regulatory and financial obligations.

Despite these arguments, the BSEC upheld its findings and imposed penalties, reinforcing its stance on strict compliance with regulatory frameworks.