The International Monetary Fund (IMF) has agreed to Bangladesh’s request for a new loan programme to replace the existing $5.5 billion arrangement, with a staff mission expected to visit Dhaka soon to begin discussions.

In a statement issued yesterday, the international lender said a final decision on the new programme would require approval from its executive board.

“Any new arrangement would need to be based on Bangladesh’s balance-of-payments needs and strong policy commitments anchored by a credible reform agenda, and would be subject to the IMF’s policies and Executive Board approval,” Ivo Krznar, IMF mission chief for Bangladesh, said in the statement.

IMF staff are engaging with the Bangladeshi authorities on their reform agenda and policy priorities as part of the fund’s consideration of possible next steps, he said.

Krznar said the upcoming staff visit would allow the IMF to assess recent economic developments, engage with authorities on policy priorities, and evaluate the outlook and reform challenges.

“Discussions about the parameters of a potential new IMF-supported programme -- including its size and related reform commitments -- would take place in the context of a subsequent program negotiation mission,” he added.

The latest development came after a virtual meeting on May 21 between Finance and Planning Minister Amir Khosru Mahmud Chowdhury and IMF Deputy Managing Director Nigel Clarke.

The two sides discussed Bangladesh’s macroeconomic situation, progress under the ongoing programme, and prospects for future cooperation.

On May 25, the finance minister said the government and the IMF had agreed to a new three-year programme to replace the existing package.

The IMF approved $4.5 billion for Bangladesh in January 2023 under three facilities -- the Extended Credit Facility (ECF), Extended Fund Facility (EFF), and Resilience and Sustainability Facility (RSF).

The package was expanded by $800 million in May last year under the interim government, bringing the total to $5.5 billion. Bangladesh has so far received $3.8 billion across five tranches.

The sixth tranche has been pending since November last year, when the IMF suspended discussions and decided to resume talks with the new government after the February election.

Under the previous schedule, the fifth and sixth tranches – together worth $1.3 billion -- were due by June, with a final tranche expected in December.

Discussions on a replacement programme began during the IMF-World Bank Spring Meetings in April. The lender signalled at the time that no further tranches would be released without visible progress on economic reforms. Virtual talks have since continued weekly over the proposed loan amount and accompanying reform conditions.

While noting that the current arrangements have provided an important policy anchor during a very difficult period, Krznar acknowledged that the macroeconomic and political context had changed substantially since it was approved in 2023.

Authorities now face a more complex set of challenges. Banking-sector weaknesses and low revenue mobilisation, he said, underscored the need for a renewed and sustained reform effort.

“The IMF remains a committed partner to Bangladesh in its efforts to secure lasting macroeconomic and financial stability, strengthen resilience, and support strong, inclusive growth,” Krznar said.

The Trump administration on Tuesday (2 June) proposed imposing additional duties of 10% or ​12.5% on imports from 60 economies after determining that their failure to curb trade in ‌goods made with forced labour is unreasonable and restricts US commerce.

The proposal from the US Trade Representative's office (USTR) is the latest finding from a Section 301 unfair trade practices investigation to be released as the Trump administration seeks to ​rebuild its emergency tariffs, which were struck down by a US Supreme Court decision in ​February, Reuters reports.

The USTR said it determined that it would impose 10% duties related to ⁠the forced labour investigation on imports from Canada, Ecuador, the European Union, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, ​Cambodia, El Salvador, Guatemala, Malaysia, Taiwan and Britain.

The trade agency said it would impose additional duties ​of 12.5% on the remaining 45 countries that it investigated.

"The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable," US Trade Representative Jamieson Greer said in a statement. "This creates ​a dynamic where American workers are forced to compete globally on an uneven playing field."

Reacting to the news, Fazlee Shamim Ehsan, executive president of BKMEA and president of the Employers Federation of Bangladesh, told TBS, "There is no justification for imposing this new tariff on Bangladesh, as the country is not among those accused of using forced labour.

"They are trying to use tariffs as a tool. This will ultimately harm the free market economy and the global economy."

The USTR said ​it was also proposing a textile mechanism that would allow for a certain volume of apparel and textile imports ‌to enter the US at a reduced tariff rate, though the duties and volumes were not disclosed, according to the Reuters report.

The announcement comes ahead of the 24 July expiration of a 10% temporary tariff imposed by the Trump administration on 10 February, the day the Supreme Court struck down US President Donald Trump's tariffs under the International ​Economic Emergency Powers Act.

The trade agency ​is also expected to soon unveil the findings of another major Section ​301 probe into ⁠the buildup of excess industrial capacity in 16 trading partners, including China.

The USTR said it would accept public comments on the proposed tariffs and other remedies through 6 July, with a public ​hearing scheduled for 7 July.

Dr Mohammad Abdur Razzaque, the chairman of Research and Policy Integration for Development - RAPID), told TBS, "It is unfortunate that a matter as universally important as the eradication of forced labour is being addressed through a unilateral trade investigation. This approach of the US appears to establish a new benchmark not grounded in any widely accepted international legal obligation."

Bangladesh has long supported international efforts to eliminate forced labour and remains committed to strengthening labour standards and enforcement, he mentioned.

"However, the present USTR proposal raises important conceptual, legal and practical questions that warrant careful consideration, particularly given its potential implications for developing countries and for the broader rules-based trading system," Razzaque added.

Bangladesh should support the objective but challenge the conceptual basis of the USTR framework, he said, adding, there is an important distinction between prohibiting forced labour itself, which is widely recognised under ILO conventions and domestic legal systems, and imposing a dedicated border measure that bans imports allegedly linked to forced labour. Bangladesh can argue that the latter represents one regulatory instrument among several and that its absence should not automatically be regarded as an unreasonable trade practice.

"Bangladesh should pursue a dual-track diplomatic strategy. On one track, we should work with other affected economies, including developing and advanced countries, to argue for proportionality, recognition of alternative regulatory approaches through international consensus, adequate transition periods, etc.

"On the other track, Bangladesh should maintain close bilateral engagement with Washington and present a credible domestic reform roadmap. Such a roadmap could include legal review, customs enforcement improvements, supply-chain due diligence measures, labour-inspection strengthening, and institutional coordination," Razzaque further said.

Bangladesh needs to project itself as reform-oriented and cooperative while avoiding unnecessary concessions or confrontation, he opined.

"It has been a matter of concern that the USTR proposal reflects a growing tendency to use tariff threats to advance regulatory norms that have not been established through multilateral agreement. While combating forced labour is a legitimate and widely shared objective, making market access conditional on a specific US-preferred regulatory model risks weakening the MFN-based trading system and further fragmenting global trade governance," Razzaque concluded.

Bangladesh is one of the fastest-growing economies, with expanding trade and GDP growth of around 4 percent. As a major South Asian trading hub, it attracts many foreign companies. While the country aims to become a developed nation by 2041 and continues progress towards the Sustainable Development Goals (SDGs), sustainable advancement requires looking beyond trade and economic indicators. The priority, I believe, should be a stronger focus on human capital development.

Human resources (HR) plays a vital role in corporate success by upholding company values, ensuring legal compliance, managing employees and mitigating risk. Today, HR managers face the challenges of rapid innovation, growing regulatory demands and increasingly complex operations. While compliance and HR are closely linked, they remain distinct functions. Effective coordination between the two is essential to maintain integrity and productivity.

Bangladesh produces around 750,000 graduates each year. National University accounts for about 450,000 of them, yet nearly 70 percent of its curriculum is considered misaligned with industry needs. Meanwhile, the economy generates around 300,000 formal jobs annually. Between 2016 and 2022, 8.7 million jobs were created for the 14 million young people who reached working age during that period. Bangladesh’s labour force stood at around 77 million in 2024, with an employment rate of 61.9 percent.

Most companies hire fewer than 10 employees a year. So, who succeeds in such a competitive environment? The phrase “managers hire attitude, not skills” reflects a hiring philosophy that prioritises mindset, character and coachability over technical ability. Yet 62 percent of employers report that young job applicants are underprepared or unsuitable for the roles they seek. There is also a shortage of skilled managers capable of training new entrants. Experience is often valued more highly than potential. Technology presents another challenge. By 2030, AI and automation could displace 20 percent to 30 percent of jobs in developing countries, including Bangladesh.

Against this backdrop, HR managers need a broad mix of soft skills, technical expertise and HR-specific competencies, as well as opportunities for continuous professional development. Recent global workforce and HR reports show that about 90 percent of executives plan to maintain or increase investment in upskilling, reskilling and workforce development in response to AI and labour market transformation. This reflects a strong commitment to learning and development.

These capabilities should be embedded in current and future managers through training and professional development and should also be considered during recruitment. Analytical thinking, active learning, problem-solving, stress tolerance, adaptability, social influence and leadership are essential qualities for HR and compliance professionals. Equally important is the ability to use technology effectively and navigate increasingly digital workplaces.

Empathy and emotional intelligence are also critical. HR professionals must respond effectively to unexpected situations, maintain discretion, uphold ethical standards and manage sensitive matters responsibly. Empathy and compassion help create supportive workplaces and strengthen employee engagement. Strong interpersonal communication skills are another key requirement. Effective communication shapes relationships, resolves conflicts and improves organisational performance. Coaching helps employees improve future performance, while counselling addresses emotional and psychological concerns. Both are important tools for supporting people in the workplace.

In Bangladesh, the outdated education system remains one of the greatest barriers to meeting the demands of a rapidly evolving job market. We continue to rely heavily on methods established nearly a century ago, particularly memorisation-based learning. If we want to compete globally, education reform must be the starting point. Competition today extends far beyond local industries. The global marketplace is the real arena. Adapting to change will help us remain competitive, but embracing change proactively will enable us not only to keep pace but also to lead with confidence in a rapidly evolving world.

The government is preparing to submit a three-year reform roadmap to the United Nations in a final effort to secure a postponement of Bangladesh's graduation from the least developed country (LDC) category until November 2029, despite a UN committee recommending a "shorter" extension.

A high-level meeting chaired by Finance Minister Amir Khosru Mahmud Chowdhury yesterday (3 June) reviewed and finalised a draft 25-point action plan that will be sent to the UN Committee for Development Policy (CDP) following the national budget announcement.

The reform commitments had already been presented to the CDP during a virtual meeting on 29 April, officials said. The proposed reforms are scheduled to be implemented between 2026 and November 2029 by various ministries and agencies, they said.

Officials said the central strategy hinges on demonstrating visible progress, monitored by a newly proposed oversight committee led by the finance minister, which will meet monthly to evaluate domestic implementation.

A senior official familiar with the discussions, on condition of anonymity, told TBS that the government plans to submit a formal letter to the CDP within the next two weeks outlining its commitments and implementation framework.

"The finance minister is highly committed to these reforms and emphasised during the meeting that they are necessary for the country's economic interests," the official said.

Based on an ERD press release, the country's newspapers yesterday published news that the CDP recommended that the United Nations General Assembly extend Bangladesh's preparatory period for LDC graduation until November 2029. But the CDP actually meant a shorter extension rather than a specific three-year period.

Reform commitments

The draft document, titled "Action Plan for Bangladesh's Preparation for LDC Graduation (2026-2029)," focuses on strengthening macroeconomic stability, financial sector governance, fiscal reforms, business deregulation, export diversification and institutional capacity.

The government has pledged to begin implementing measures to ensure macroeconomic stability from June 2027, with implementation continuing until November 2029. The plan includes stronger coordination between monetary and fiscal policies, regular assessment of demand and supply conditions for essential commodities, and trade policy adjustments to maintain uninterrupted supplies.

Bangladesh will also commit to addressing debt vulnerabilities identified in debt sustainability assessments conducted by the International Monetary Fund and the World Bank.

Financial sector reforms feature prominently in the draft roadmap. The government plans to strengthen Bangladesh Bank's supervisory authority and restore discipline across the financial sector by December 2027. It also intends to conduct annual comprehensive reviews of all commercial banks, covering asset quality, capital adequacy, liquidity, governance and stress testing, with corrective measures taken where necessary.

The reform programme further includes anti-corruption initiatives and governance improvements. The government aims to expand digital public service delivery systems to reduce direct interactions between citizens and officials while strengthening transparency, accountability and parliamentary oversight through November 2029.

Deregulation and tax reforms

Business deregulation is another major pillar of the proposed reforms. By June 2027, the government plans to establish a unified digital application platform covering licences, certificates, approvals and renewals. Licensing procedures will be simplified, provisional licences will be issued within seven days and the validity period of licences and permits will be extended from one year to five years.

The government also intends to make the National Single Window fully operational within the same timeframe.

Under fiscal reforms, state-owned enterprises are expected to become commercially viable by June 2028, with selected entities potentially listed on the stock market. The government has also pledged to broaden the tax base and strengthen transparency and accountability in the collection of fees and non-tax revenues.

Plans include integrating data systems between banks and the Central Depository Bangladesh Limited by June 2028 to facilitate automated reporting of savings and investment information.

Other measures include reducing the discretionary powers of tax officials, fully automating the National Board of Revenue and its commissionerates, limiting tax exemptions and strengthening value-added tax compliance.

To monitor implementation, the government intends to establish a joint government-private sector task force.

Export competitiveness and infrastructure

As part of efforts to diversify exports ahead of graduation, the government plans to provide targeted incentives and policy support to pharmaceuticals, leather, information and communications technology, agro-processing, jute and light engineering industries.

By December 2028, authorities aim to improve central effluent treatment facilities for the tannery sector and operationalise the Active Pharmaceutical Ingredient Park.

The government also intends to reduce logistics costs from 15% to 10% by June 2029 through port modernisation, customs reforms, improved multimodal connectivity and the development of integrated industrial and logistics corridors.

In the energy sector, Bangladesh plans to encourage investment in renewable energy, develop a carbon market policy and expand green financing initiatives.

The draft roadmap also outlines measures to secure Generalised Scheme of Preferences Plus benefits in the European Union after graduation. Bangladesh may additionally seek to conclude free trade agreements with South Korea, Oman, the United Arab Emirates, Hong Kong and New Zealand by 2029.

The government has pledged continued support for exporters seeking to meet standards in major markets, including the European Union, the United States, Japan, South Korea, China and regional trading partners.

A revised Smooth Transition Strategy reflecting current domestic and global realities is expected to be completed by March 2027, while progress on implementation will be reviewed monthly.

What happens next?

According to officials, the CDP's recommendation will now be considered by the United Nations Economic and Social Council (ECOSOC) at its meeting on 22-23 July. ECOSOC is expected to forward the recommendation to the United Nations General Assembly.

If procedural constraints prevent ECOSOC from formally adopting the recommendation, Bangladesh may have to seek approval directly from the General Assembly during its September session.

Experts said a favourable recommendation from ECOSOC would improve Bangladesh's prospects of securing an extension at the General Assembly.

Although Bangladesh has met all three formal graduation criteria, analysts believe the government's request for additional preparation time prompted the CDP to recommend a shorter extension as a special accommodation.

They stressed that commitments alone would not be sufficient. Bangladesh must demonstrate measurable progress on reforms and clearly identify areas where international institutions such as the IMF, the World Bank and the Asian Development Bank are involved.

Several experts described the CDP's recommendation as an exceptional concession rather than a precedent for future requests from other LDCs.

This year, Bangladesh is scheduled to graduate from LDC status alongside Nepal and Laos. However, Nepal has also submitted a letter to the CDP seeking a postponement.

After Prime Minister Tarique Rahman sent a letter to the CDP on 6 April requesting a three-year deferment of Bangladesh's graduation, the committee subsequently decided to recommend a postponement.

At that time, however, the CDP's assessment report on Bangladesh's preparedness for LDC graduation had not yet been completed. As a result, the report was not attached to the resolution sent to the ECOSOC. The assessment will now be forwarded separately to ECOSOC.

Under the CDP's recommendation, ECOSOC may endorse a postponement of one year, two years, or the full three years requested by Bangladesh. The final decision, however, will be taken through a vote at the United Nations General Assembly.

What experts say

Debapriya Bhattacharya, a distinguished fellow at the Centre for Policy Dialogue and a member of the CDP, said the extension represents a unique opportunity for Bangladesh.

"This is an exceptional opportunity for Bangladesh. The government should quickly communicate its reform commitments and establish a monitorable implementation framework. That could positively influence consideration by both ECOSOC and the UN General Assembly," he said.

He added that LDC graduation should be viewed not only as an economic issue but also as a political commitment that reflects the country's future development trajectory.

Zahid Hussain, a former lead economist at the World Bank's Dhaka office, said the CDP's recommendation was conditional on Bangladesh implementing fiscal, banking and structural reforms to diversify the economy.

"Bangladesh comfortably meets all graduation criteria even after accounting for the adverse factors identified to make the case for deferment," he said.

According to Zahid, the recommendation reflects concerns about the country's capacity to implement its Smooth Transition Strategy amid challenges arising from the Middle East crisis, disruptions to global trade and the country's political transition.

"Two things are clear. First, this is the last extension if it makes it through the next steps. Second, the period of extension will be less than three years," he said.

The economist added that while approval remains uncertain, Bangladesh's prospects of securing an extension have improved significantly.

The war in the Middle East has dented economic growth prospects worldwide, with a more severe shock likely if no effective ceasefire is agreed before 2027, the OECD warned today (3 June).

Global economic growth is now forecast to slip to 2.8% for 2026 if Gulf exports of oil and gas return to pre-conflict levels in the third quarter, the group of 38 industrialised countries said in its quarterly update.

Previously, the OECD had forecast full-year global growth of 2.9%.

But if the Mideast war continues into next year, global growth could slow to 2.1%, the OECD said -- well below the average annual growth of 3.45% seen from 2013 to 2019, before the Covid pandemic.

"The longer the disruptions last, the larger the economic and social costs become," the group's chief economist Stefano Scarpetta said in the report.

Many countries would risk falling into recession, he noted, and a drop in investment spending -- "including in energy-intensive AI" -- would likely push up unemployment.

Sustained high prices for energy as well as fertiliser and other key products from hydrocarbon production in the Gulf would weigh especially hard on developing countries that have "higher shares of energy and food in household consumption".

Even if the war sparked by US and Israeli strikes on Iran in late February ends in the coming weeks, the OECD forecasts global inflation rising to 4%this year from 3.4% in 2025.

In this "time-limited disruption scenario", the group expects US growth to slow to 2% this year and 1.8% in 2027, after growing 2.1% last year.

In the eurozone, where many countries are highly dependent on energy imports, GDP growth will slump to 0.8% this year after 1.4% last year, assuming a Mideast ceasefire is secured in the coming weeks.

After a strong rebound in April, Bangladesh's export earnings fell again in May by 7.07% year-on-year, according to Export Promotion Bureau (EPB) data released today (3 June).

Exporters attribute the fall mainly to factory closures during the extended Eid holidays and a sustained slowdown in global demand.

In value terms, Bangladesh exported goods worth around $4 billion in May, down from $4.73 billion a year earlier. However, exports rose nearly 10% compared to April, indicating a short-term monthly recovery amid a broader slowdown.

Overall, export earnings in the first 11 months (July-May) of the fiscal 2025-26 fell by 2.55% compared to the same period last year. Total exports stood at $43.80 billion, down from $44.95 billion. Of the 11 months, nine recorded negative growth.

The ready-made garment (RMG) sector, which accounts for over 80% of national export earnings, remained the main drag. In May alone, garment exports fell by 8.29%.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Vice President Shehab Uddin Chowdhury told The Business Standard that Eid holidays disrupted production and shipments.

"Factories remained closed for five to six days at the end of May due to Eid, which reduced shipments," he said, adding that global apparel demand remains weak.

Segment-wise data show knitwear performed worse than woven products. Knitwear exports fell 8.29% in May year-on-year, while over July-May they declined 4.26%, compared to a 2.42% drop in woven exports.

Industry stakeholders say the contraction in knitwear – largely basic apparel items – signals weakening global demand for low-value garments, a segment where Bangladesh has traditionally been strong.

Sparrow Group Managing Director Shovon Islam said the trend reflects a structural shift in demand. "A decline in knitwear exports indicates shrinking demand for basic items globally. To stay competitive, Bangladesh needs to move toward higher-value products, including man-made fibre-based garments," he said.

Outside garments, several major export categories also declined in May: frozen and live fish fell 22%, agricultural products 2.19%, leather and leather goods 13%, other footwear products 7%, and paper products 23%.

Some sectors, however, posted growth. These included home textiles (3.67%), specialised textiles (4.91%), jute and jute goods (8.40%), plastic goods (14.15%), and chemical products (11.65%).

Exporters warned the weak trend may continue into June, although business leaders expect a gradual recovery. "We expect exports to pick up from July," said Shehab Uddin Chowdhury.

The Financial Institutions Division has directed Bangladesh Bank representatives and managing directors of all scheduled banks to take necessary steps to enrol their officers and employees in the Pragati Scheme under the Universal Pension System.

The instruction was issued at a discussion meeting chaired by Nazma Mobarek, secretary of the Financial Institutions Division under the Ministry of Finance, at the Secretariat in Dhaka yesterday.

It was noted at the meeting that the National Pension Authority (NPA) has signed memorandums of understanding (MoUs) with 48 banks and financial institutions, while 24 banks are actively involved in collecting and disbursing pension contributions.

Addressing the meeting, the secretary said separate desks should be set up at all bank branches to increase enrolment in the Universal Pension System.

She also directed banks to display banners in accordance with the MoUs and ensure that marketing officials play an active role in promoting the scheme.

Mobarek further stressed the need to bring all officers and employees of private banks under the Pragati Scheme.

Md Suratuzzaman, executive chairman of the NPA, presented a keynote paper highlighting the progress of the Universal Pension System, the features of the Pragati Scheme and its importance for private-sector workers.

He said around 18 million private-sector workers in Bangladesh lack formal retirement security, unlike government employees who are covered by state pension arrangements. The Pragati Scheme was introduced to address this gap under the Universal Pension System launched in 2023.

The meeting also discussed proposals to introduce a shariah-based pension scheme, extend lifelong pension benefits to nominees and bring outsourced workers under the Pragati Scheme. The Pragati Scheme is designed for private-sector employers and employees.

Under the scheme, employees and employers each contribute 50 percent of the monthly contribution. Monthly contributions range from Tk 1,000 to Tk 15,000, and participants receive lifelong monthly pension benefits after retirement.

The scheme also offers tax incentives, as contributions are eligible for income tax rebates while pension income remains fully tax-free. Upon reaching the age of 60, participants receive up to 30 percent of their accumulated corpus as a one-time gratuity payment. The scheme is backed by government-guaranteed investments.

As of May 30, 2026, a total of 3,77,930 people had registered under the four pension schemes, with deposits reaching about Tk 260 crore and investments standing at Tk 286 crore.

The Cabinet Committee on Government Purchase has recommended separate proposals to import five liquefied natural gas (LNG) cargoes to meet the country's fuel requirements.

Among the proposals was the purchase of two LNG cargoes from SOCAR Trading SA of Switzerland under a direct procurement process for 2026. The proposal was placed by the Energy and Mineral Resources Division.

Under the proposal, the LNG will be purchased at a price linked to the JKM benchmark, with a premium of $0.25 per million British thermal units (MMBTU).

The committee also recommended another proposal for the purchase of three LNG cargoes through the international Request for Quotation (RFQ) process under the Public Procurement Rules 2025.

The cargoes are scheduled for delivery during three separate windows: June 26-27, June 30-July 1, and July 6-7 this year.

Under the RFQ process, BP Singapore Pte Ltd was selected to supply one cargo, while TotalEnergies Gas & Power Ltd, UK, was selected to supply two cargoes.

The government will spend over Tk 2,372 crore for the three cargoes.

The recommendations came at the cabinet committee's 24th meeting of 2026, held on June 3, according to a press briefing released after the meeting.

A total of seven proposals were placed before the committee for discussion.

Qatar is a long-term supplier of LNG to Bangladesh, and it ships a large amount of LNG through the Strait, which accounts for roughly a fifth of global LNG flows.

Bangladesh meets nearly 30 percent of its gas demand through imported LNG, while domestic output continues to fall short of the total requirement of about 2,650 mmcfd (million cubic feet per day), according to energy ministry data.

LNG prices have nearly doubled compared with the pre-war level of around $10–12 per MMBtu.

The global economic outlook hinges on how long the war in the Middle East lasts, with recession in some countries and sharply higher inflation a real possibility if it drags on into next year, the Organisation for Economic Co-operation and Development warned on Wednesday.

If the conflict proves short-lived, Gulf oil and gas production could gradually return to pre-crisis levels from the third quarter with shortages confined to Asia and cushioned by strategic reserves and shipments from other producers.

If energy disruption persists well into next year, global growth could slow sharply to 2.1 percent in 2026 and 1.8 percent in 2027 - rates rarely seen outside major crises such as the 2008 to 2009 financial crash or the COVID pandemic.

Some economies could fall into outright recession, with Asian countries reliant on Middle East energy supplies expected to be hit hardest.

In the protracted disruption scenario, higher energy prices could add 0.4 percentage points to global inflation in 2026 and 1.3 percentage points in 2027, likely prompting central banks to hike interest rates by 0.5 to 0.75 percentage points in the short term.

In the baseline scenario, the OECD forecast that inflation across G20 economies would peak at 4 percent this year before slowing to 3.1 percent next year with interest rates largely on hold this year and cuts expected next year.

“Around one-third of OECD economies are projected to experience negative real wage growth this year.

Workers in these countries will see their living standards fall, which is the human reality behind the inflation numbers,” OECD Secretary General Mathias Cormann said.

Global trade growth is set to moderate following a strong 2025, though robust demand for AI-related goods and investment, especially in Asia, should provide some support.

In the baseline scenario, stronger energy exports are expected to support US growth, partly offsetting the drag from higher prices on household purchasing power. Growth is projected to ease from 2.1 percent in 2025 to 2.0 percent in 2026 and 1.8 percent in 2027.

In Europe, euro zone growth was seen slowing from 1.4 percent to 0.8 percent this year before rising to 1.2 percent next year as resilient labour markets and higher defence spending help offset government belt-tightening.

In Britain, growth is projected to slow to 0.9 percent this year before recovering to 1.1 percent in 2027 as global trade stabilises and financial conditions ease.

In Asia, China was seen slowing from 5.0 percent growth in 2025 to 4.5 percent in 2026 and 4.3 percent in 2027 with ample energy reserves limiting exposure to oil price spikes. Exports are set to benefit from lower US tariffs and a competitive tech sector, although a property slump remains a drag.

Japan is expected to be among the hardest-hit by trade disruptions linked to the Gulf conflict, with growth slowing from 1.1 percent in 2025 to 0.6 percent in 2026 before edging up to 0.8 percent in 2027, a downgrade from March.

While subsidies will help cushion the energy shock, the OECD said Japan needs a “clear and credible” plan to rein in public finances over the medium term as interest rates rise.

Any new US tariffs on European Union goods on top of the rates agreed last year would be unacceptable, senior EU lawmaker said on Wednesday, ​rejecting US claims the EU was not curbing trade in forced labour ‌goods as “utterly absurd”.

The US Trade Representative’s office on Tuesday proposed imposing additional duties of 10 percent or 12.5 percent on imports from 60 economies, including the European Union, saying investigations showed they failed to curb ​trade in goods made with forced labour.

“The impression is increasingly emerging that a tariff measure is sought first, ​and only then is a suitable legal justification found. The approach here is: ​if it doesn’t fit, make it fit,” he said.

Lange said that at the end of 2024, the ‌European Union adopted the world’s strictest legislation against products made using forced labour and that companies were already preparing for the new requirements to make supply chains more transparent, identify risks and demonstrate that countermeasures are in place.

The European Commission was working on the ​final implementation guidelines ​for authorities and businesses, he said.

“The claim that the EU is not taking sufficient action against forced labour does not stand up to serious scrutiny. ​Anyone who examines the facts knows that the European Union is ​setting global standards in this area,” he said.

“The key question will therefore be whether the proposed additional tariff of ten per cent will exceed the Turnberry agreements,” he said referring to ⁠an agreement ​from July 2025 in which the EU agreed ​to remove tariffs on US goods and Washington agreed to a maximum tariff on most EU goods of ​15 percent.

Gold prices slipped on Wednesday, as renewed hostilities ‌in the Middle East pushed crude higher and stalled US-Iran talks, while investors awaited upcoming US economic data.

Spot gold fell 0.5 percent to $4,460.36 per ounce by 0702 GMT, after rising ​more than 1 percent in the previous session. US gold futures for August ​delivery slipped 0.7 percent to $4,488.90.

US Secretary of State Marco Rubio said on Tuesday that President ​Donald Trump’s negotiating team has not offered Iran sanctions relief in exchange for reopening the Strait of Hormuz and insisted that any sanctions relief was tied to Tehran giving up its ​nuclear programme.

“The market is now looking at the possibility that this ceasefire with ​Iran may not hold even though Trump is going to push for a peace deal ‌resolution,” said Kelvin Wong, a senior market analyst at OANDA.

“If we start to see further escalation, that could also dampen whatever recovery that gold might have had.”

Oil prices rose more than 1 percent, deepening concerns over inflation and interest rate hikes.

Cleveland ​Federal Reserve President Beth ​Hammack said on Tuesday the US central bank may need to raise interest rates soon should already-high inflation pressures continue to mount.

Investors are ​now awaiting the US nonfarm payroll data, due later in ​the day, and employment report due on Friday to gauge the Fed’s monetary policy path.

Although gold is typically viewed as a hedge against inflation, it tends to lose its appeal ​as a non-yielding asset in a high interest-rate ​environment.

Oil prices trended lower on Tuesday following the previous session’s sharp gains as ​the market remained cautious about progress in US-Iran peace talks.

US President Donald Trump said on Monday talks with Iran were ‌ongoing, while Tasnim news agency reported earlier that Tehran had suspended indirect negotiations with Washington.

Brent crude futures lost 53 cents, or 0.56 percent, to $94.45 a barrel at 0649 GMT, while US West Texas Intermediate fell 56 cents, or 0.61 percent, to $91.60 a barrel.

Both benchmarks rose more than 5 percent in ​the previous session, having posted a monthly loss of more than 16 percent in May on hopes of a ​peace deal.

“While markets had hoped to move past the uncertainty amid prospects of a potential deal, nothing appears to have changed for oil as of this morning,” said Priyanka Sachdeva, senior market analyst at ​Phillip Nova.

In an interview with CNBC on Monday, Trump said he did not mind if the talks were over. But shortly ​after, he issued a social media post saying talks with Iran were continuing and told ABC News that he expected a deal to extend the ceasefire and reopen the Strait of Hormuz “over the next week”.

“The market is currently focused on whether there’s any concrete progress or setbacks ​in US-Iran negotiations, the tone and substance of statements from both sides (particularly Iran’s threats regarding the Strait of Hormuz), ​and actual physical tanker movements through the waterway,” said Tim Waterer, chief market analyst at KCM Trade.

The status of the US-Iran negotiations at ‌any given point will ultimately determine whether the current risk premium stays embedded in oil prices or starts to unwind, Waterer added.

Lebanon on Monday announced a partial ceasefire between Hezbollah and Israel, in what would amount to a limited de-escalation of a conflict that has inflamed the broader war with Iran.

Iran has effectively halted nearly all non-Iranian shipping into and out of the ​Gulf since the war began, ​choking off about a fifth of global oil and liquefied natural gas flows and driving prices up by 50 percent or more.

The government has decided to introduce a 0.25% fee on guarantees issued against loans taken by state-owned, autonomous, and government-controlled entities.

In a circular issued by the Ministry of Finance today (2 June), it stated that the fee will apply to both local and foreign loans backed by state guarantees.

According to the circular, the Finance Division, under the authority of the Public Debt Act 2022 and the State Guarantee or Counter-Guarantee Policy 2014, will impose a one-time guarantee fee on loans taken under sovereign backing. The fee must be deposited into the government treasury through the designated payment system.

A Finance Division official told The Business Standard that the measure applies when state-owned companies, public entities, or joint ventures seek loans from domestic or international sources that require government guarantees. "The move aims to discourage excessive reliance on sovereign guarantees while also increasing revenue collection."

"State-owned and autonomous institutions often rely on borrowing to finance development projects, with lenders frequently requiring government guarantees as a condition. These guarantees are issued by the Finance Division on behalf of the government," the official added.

According to the ministry, by December 2025, the government had provided guarantees worth Tk106,973 crore for various domestic and foreign loans. Of this, Tk58,383 crore was in foreign loans and Tk48,590 crore in domestic loans.

More than half of the guaranteed loans are in the power sector. Guarantees have also been extended to agriculture-related loans and to Biman Bangladesh Airlines.

The government has also guaranteed foreign borrowing by the Bangladesh Petroleum Corporation (BPC) for fuel imports, as well as agricultural loans from Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank (Rakub).

The benchmark index of the Dhaka Stock Exchange (DSE) reclaimed the 5,400-point threshold today (2 June), hitting a three-month high as a sustained seven-day winning streak gathered pace.

Investor sentiment was significantly bolstered by fresh government commitments to restructure the stock market regulator with non-political, skilled professionals.

The rally, which has added 203 points to the broad index over the last seven trading sessions, reflects a growing confidence among market participants regarding the future governance and transparency of the capital market.

The benchmark DSEX index rose by 33 points to settle at 5,406 today, its highest level since early March.

The market's upward trajectory also resulted in a substantial increase in valuation, with the total market capitalisation of the premier bourse jumping by Tk12,700 crore over the last week to reach Tk6.88 lakh crore.

Market participation saw a notable surge as daily turnover increased by 18%, crossing the prestigious thousand-crore mark to settle at Tk1,080 crore.

The primary catalyst for today's surge was a landmark announcement by the Finance and Planning Minister at an event titled "Budget 2026-27: Expectations and Reality," organised by the Economic Reporters Forum.

The minister revealed that the Bangladesh Securities and Exchange Commission (BSEC) will be fully restructured within the next two weeks, adding that a new chairman and four commissioners are being appointed through a strictly professional process, free from political influence or consultation with political parties.

Analysts believe that if the government fulfills its promise of a professionally run BSEC, the market could sustain its current momentum and attract much-needed institutional and foreign investment in the coming months.

The optimism was visible across the trading floor, with the blue-chip DS30 index inching up by 5 points to close at 2,049.

Market breadth remained strongly positive as 230 issues advanced compared to 116 that declined, while 47 remained unchanged.

Sector-wise performance was led by general insurance, which posted a 2.28% return, followed by the tannery, cement, and non-bank financial institution (NBFI) sectors. Conversely, the jute, telecommunication, and travel and leisure sectors faced minor corrections.

In terms of individual stock activity, the banking sector remained the focus of high-volume trading. Jamuna Bank, BRAC Bank, and City Bank emerged as the top traded stocks, alongside RD Food and Agni Systems.

Among the top gainers, Meghna PET and Sonargaon Textile led the chart, both surging by nearly 10%. On the other hand, BIFC and International Leasing were among the top losers as investors shifted capital away from struggling financial entities toward fundamentally stronger scrips.

The bullish sentiment extended to the Chittagong Stock Exchange, where the Selective Categories' Index (CSCX) gained 62 points to finish at 9,277, and the All Share Price Index (CASPI) jumped 110 points to reach 15,080. However, unlike the Dhaka bourse, turnover at the port city exchange saw a 42% decline, standing at Tk27.19 crore.

The Customs House, Chattogram has put 102 containers of abandoned goods up for online auction as part of efforts to reduce congestion at the country’s busiest seaport and improve operational efficiency.

According to a press release issued by the National Board of Revenue (NBR) on Monday, the goods will be auctioned through the e-Auction programme this month. The auction comprises 44 lots containing 102 containers of various products, including chemicals, machinery and spare parts, paper, freezers, generators, limestone, fabrics, transformers, quartz powder and household items.

The NBR said no reserve price has been set for the consignments, allowing bidders to compete freely.

The auction will be conducted entirely through a digital platform to ensure transparency and accountability. Interested buyers will be able to inspect the goods before submitting bids online through the customs e-Auction portal. However, bid security instruments and other required documents must be submitted physically.

The tender box for the auction will be opened at 11:00am on June 18.

According to data from the Chittagong Port Authority and the NBR, around 200,000 tonnes of imported goods stored in 8,965 containers were left abandoned at Chattogram Port between 2013 and 2025.

Importers abandon consignments for a variety of reasons, including declines in domestic prices, failure to submit original documents and obtain the required clearance permits, and unwillingness to pay fines arising from discrepancies or irregularities in import documentation.

At the start of June, following the Eid holidays, the Bangladesh Jewellers’ Association (BAJUS) has reduced the prices of gold and silver in the country’s market on Tuesday.

Price of gold fell by Tk 3,266 per bhori while silver dropped by Tk 177 per bhori.

In a statement, BAJUS said that considering overall market conditions, the price of 22-carat pure gold was reduced by Tk 3,266 per bhori to Tk 234,855.Capital Market Insights

The revised price has been effective since Tuesday morning.

According to the new rates, the market price per bhori (11.664 grams) of 21-carat gold is Tk 224,182, 18-carat gold Tk 192,164, and traditional gold Tk 156,473.

Previously, on May 25, BAJUS adjusted the gold price, raising the 22-carat gold rate by Tk 2,158 per bhori to Tk 238,121.

So far in 2026, the gold price has been revised 70 times in the country’s market, with 37 increases and 33 decreases.

Along with gold, silver prices were also reduced in the market. The price of 22-carat silver fell by Tk 117 per bhori to Tk 5,657.

Other rates include Tk 5,365 per bhori for 21-carat silver, Tk 4,607 per bhori for 18-carat silver, and Tk 3,441 per bhori for traditional silver.

In 2026, silver prices have been adjusted 41 times in the market, with 22 increases and 19 decreases.

The telecom regulator has decided to allocate additional lower-band spectrum to mobile operators through an auction process, aiming to improve network coverage, indoor connectivity and rural service quality.

The Bangladesh Telecommunication Regulatory Commission (BTRC) made the decision at a recent meeting following recommendations from a technical committee tasked with comparing spectrum bands, setting prices and identifying cross-border interference issues, regulatory officials said.

“The additional lower-band spectrum could help operators strengthen network coverage in both urban and rural areas,” said Major General (retd) Md Emdad-Ul-Bari, chairman of the BTRC.

Spectrum refers to the radio frequencies used to transmit mobile signals. Lower-band spectrum with frequencies below around 1,000 MHz is particularly valuable because signals travel farther and penetrate walls more effectively than higher-frequency bands. This allows operators to cover wider areas using fewer towers, cutting infrastructure costs while improving service quality.

“The additional lower-band spectrum could help operators strengthen network coverage in both urban and rural areas,” said Major General (retd) Md Emdad-Ul-Bari, chairman of BTRC
Since multiple operators have applied for the same spectrum blocks, the commission decided to allocate them through a competitive auction rather than direct assignment, officials familiar with the matter said.

According to a committee report presented at the meeting, the Extended GSM (EGSM) band is more practical for Bangladesh in the short term because almost all mobile handsets in the country already support it for 2G services -- voice calls, SMS and low-speed data.

The committee was formed to compare the 850 MHz and EGSM bands, determine spectrum pricing and identify technical barriers, particularly cross-border interference issues affecting parts of the EGSM spectrum.

In its report, the committee noted that lower-band spectrum could significantly improve indoor connectivity in densely populated cities while helping operators reach remote areas.

However, it also identified major interference challenges in parts of the EGSM spectrum, particularly in border areas near India.

To assess the scale of the problem, mobile operators monitored interference levels across Rajshahi, Rangpur, Mymensingh, Sylhet, Cumilla, Chattogram, Khulna, Barishal and Cox’s Bazar, as well as several parts of Dhaka.

Apart from Dhaka, testing was largely carried out at sites between roughly 5 and 50 kilometres from international borders. For technical analysis, the committee split the 8.4 MHz block of EGSM spectrum under consideration into two portions.

The first, Block A, consists of 5 MHz of spectrum in the 880-885 MHz and 925-930 MHz frequency ranges. Frequencies in this band can travel long distances and penetrate buildings effectively, making them particularly valuable for coverage in dense cities and remote areas.

According to the report, interference levels in this block were extremely low in Rajshahi and Khulna. However, significant interference was detected in Rangpur, Mymensingh, Sylhet, Cumilla and Chattogram, especially in border-adjacent areas.

The committee estimated that interference in Block A could affect approximately 40 to 50 percent of Bangladesh’s total geographic area.

The second portion, known as Block B, includes 3.4 MHz spectrum in the 885-888.4/930-933.4 MHz range.

The committee found that interference in this block was comparatively lower. Significant interference was observed only in Rangpur, while most other regions remained practically interference-free.

The report stated that the interference impact in Block B would likely remain limited to around 5 to 10 percent of the country’s area, making it more commercially attractive for operators.

Despite these challenges, the committee concluded that the EGSM band should still be considered more suitable than the 850 MHz band for short-term allocation because of handset compatibility and immediate deployment feasibility.

The 850 MHz band offers stronger signal reach and better building penetration, but relatively few handsets in Bangladesh currently support it, limiting how quickly operators could put it to use.

There is one limitation worth noting for the EGSM band as well. Since Bangladesh still has relatively low smartphone penetration, only around 60 percent of users may be able to use the band effectively for data services.

For commercial allocation, the committee proposed dividing the same 8.4 MHz into three blocks -- one of 1.6 MHz and two of 3.4 MHz each -- based on operator demand. Robi Axiata currently holds the 1.6 MHz portion, while both Robi and Banglalink have applied for the two 3.4 MHz blocks.

Apart from deciding to auction the spectrum, the commission also endorsed the committee’s pricing recommendations and agreed to forward them to the Posts and Telecommunications Division for policy approval.

For the lower-interference 3.4 MHz block, the committee recommended setting the base price at Tk 237 crore per MHz for a 15-year period, matching the government-approved benchmark price for the 700 MHz band.

However, considering that the spectrum would only remain available until 2030 and that some limited interference still exists in certain areas, the commission said the government may consider reducing the base price by up to 10 percent.

For the more interference-prone 5 MHz block, the committee proposed a larger discount. Operators argued for a steeper reduction -- between 30 and 40 percent below the Tk 237 crore benchmark -- on the grounds that cross-border interference would prevent them from using the spectrum nationwide. However, the commission settled on a maximum discount of 25 percent.

The committee further recommended that operators use technical filters and mitigation tools to minimise interference and improve coexistence within the band.

The UN CDP’s recommendation to consider an extension of Bangladesh’s preparatory period for LDC graduation is a highly significant development. It is also consistent with the findings of the Graduation Readiness Assessment, earlier commissioned by UNOHRLLS at the request of the interim government. Overall, these assessments strengthen the case that Bangladesh’s LDC timeline extension request is a justified appeal to manage a complex transition under exceptional circumstances.

The CDP’s assessment confirms two things at once. First, Bangladesh continues to meet the graduation criteria by a wide margin, and its graduation eligibility is not in question. Second, Bangladesh has faced a combination of shocks, including the lingering effects of the pandemic, global economic instability, geopolitical tensions, supply-chain disruptions, and a major domestic political transition, all of which have constrained the implementation of critical preparatory measures. The recommendation therefore gives Bangladesh’s request stronger legitimacy within the UN process.

The next step will be to secure support in the UN General Assembly. Bangladesh should not assume that the CDP recommendation alone will automatically translate into approval. A focused diplomatic drive is now essential. The government will need to engage with UN member states, explain the evidence behind the request, demonstrate that the extension will be used for concrete reform actions, and reassure partners that Bangladesh remains fully committed to graduation.At the same time, Bangladesh must navigate the process with care. In the current global environment, geopolitical issues have become a serious development risk. While support should be sought from all relevant partners, the LDC graduation extension should not become a bargaining chip in ways that compel Bangladesh to make costly concessions to major powers. Diplomatic engagement should therefore be broad-based, principled, and carefully coordinated, with the extension framed as a development-transition issue rather than a matter of geopolitical alignment.

The CDP recommendation makes the case for an extension considerably stronger. It gives Bangladesh a credible basis for arguing that additional time is warranted on developmental, institutional, and transition-management grounds. However, we must treat this extension as a time-bound window for accelerating long-overdue reforms and strengthening graduation preparedness, not as a pause or a justification for delaying difficult policy decisions. Three years will pass very quickly.

Immediate priorities must include urgently securing post-graduation trading arrangements with the European Union, which absorbs nearly half of Bangladesh’s exports and where the country’s garment sector will face intensifying competitive pressure in the aftermath of the EU’s free trade agreements with Viet Nam and India. Failure to secure favourable market access could significantly erode Bangladesh’s export competitiveness. At the same time, Bangladesh must strengthen export resilience by accelerating diversification beyond traditional products and markets, reducing the longstanding anti-export bias embedded in domestic policies, enhancing productivity and compliance standards, and fast-tracking the implementation of the key measures identified in the Smooth Transition Strategy for LDC graduation.

This is where foreign direct investment becomes central. Bangladesh’s limited progress in non-RMG exports shows that export diversification cannot be achieved through domestic production capacity alone. The missing link has been FDI. While Bangladesh has developed a large and competitive garment sector, its non-RMG sectors have remained weakly connected to global value chains, international buyers, quality-control systems, design networks, and distribution channels. FDI can help close this gap by bringing technology, managerial capability, compliance systems, global sourcing relationships, and access to established markets.

Successful diversifiers have used foreign investors and joint ventures to anchor domestic firms within global production networks. Bangladesh must now treat FDI not as a general investment objective, but as a core instrument of export transformation. This requires a more focused investment strategy. Rather than spreading policy attention thinly across too many economic zones and sectors, a few selected special economic zones should be prioritised and made fully functional for export-oriented investors. These zones should offer reliable power and gas, customs facilitation, serviced land, duty-free input access, compliance infrastructure, labour-skills support, and fast-track regulatory services.

If needed, generous but disciplined incentives should be offered to attract a small number of large foreign multinational export manufacturers. Securing a few credible anchor investors can have a demonstration effect: once global firms begin producing successfully in Bangladesh, suppliers, logistics providers, buyers, and other investors are more likely to follow. As multinational firms seek to reduce excessive dependence on major geopolitical power manufacturing locations, Bangladesh can position itself as a competitive, non-power-aligned production base for global exports. Bangladesh has already demonstrated its ability to produce at scale, supported by abundant labour, an established export culture, and proximity to Asian supply chains. These advantages will count only if Bangladesh presents itself as a reliable, reform-oriented, and export-ready location.

Several long overdue actions require urgent attention. Foremost among them is fixing the Central Effluent Treatment Plant in Savar and ensuring environmental compliance in the leather sector. This would restore credibility and signal seriousness to investors. Other priorities include creating affordable export-support financing for man-made fibre-based apparel, improving product quality and compliance standards in agro-processing and other promising export sectors, reducing logistics and trade-related costs, and preparing for emerging regulatory requirements such as the EU’s Corporate Sustainability Due Diligence Directive and the Carbon Border Adjustment Mechanism.

The issue of export incentives also deserves special consideration. While many broader policy reforms have stalled, the reduction of export incentives appears to have been placed on a much faster track. This sequencing is questionable. The resurgence of industrial policy globally, and recent experience from export success by various economies, suggest that carefully designed support for exports remains important for building supply-side capacity and strengthening competitiveness. With the possibility of an extension of Bangladesh’s graduation timeline, the country must use any available policy space strategically. Export support should not be indiscriminate, but it should be targeted and linked to export expansion, diversification, technology upgrading, compliance, and new market entry. Removing support before alternative competitiveness-enhancing reforms are in place could weaken the very sectors Bangladesh needs to build for the post-LDC period.

More fundamentally, the success of any extended preparatory period will depend on domestic economic management. Tackling inflation, restoring macroeconomic stability, addressing banking-sector weaknesses, and strengthening implementation capacity remain critical. Without progress in these areas, an extension may provide temporary relief but not a stronger transition. The real test, therefore, will be whether Bangladesh can use the additional time to accelerate reforms, deepen productive capacity, attract export-oriented investment, and enter the post-LDC phase with greater confidence and resilience.

The government’s ongoing effort to formulate a new five-year strategic framework presents a timely opportunity to embed LDC graduation preparedness within a broader national development action plan. Rather than treating graduation-related measures as a parallel exercise, the plan should explicitly align its priorities, targets, and implementation mechanisms with the requirements of a successful post-LDC transition.

In this regard, Bangladesh already possesses a valuable foundation in the STS, which contains a comprehensive set of actions covering macroeconomy, export competitiveness and diversification, productive capacity, institutional strengthening, and international partnerships. Many of these measures can be incorporated directly into the forthcoming development framework. The new strategic plan should therefore establish clear priorities, assign institutional responsibilities, define implementation timelines, and allocate the necessary resources to ensure that the most critical graduation-related reforms are carried out within the available window of opportunity.

Bangladesh Bank (BB) has instructed all scheduled banks to give priority to farmers affected by recent heavy rainfall in receiving agricultural credit under its refinancing scheme, aiming to support recovery efforts and protect farm production in vulnerable regions.

The directive was issued today (Tuesday) through a Financial Inclusion Department (FID) circular, BSS reports. Bangladesh Economic Report

According to the circular, banks have been asked to ensure quick and priority-based loan disbursement to farmers in flood-affected haor and other areas where intense rainfall has damaged crops and disrupted agricultural activities.

The central bank said farmers in districts such as Sylhet, Sunamganj, Habiganj, Kishoreganj, Netrokona and Moulvibazar have suffered significant losses due to recent adverse weather conditions, making timely access to credit crucial for restoring agricultural production and livelihoods.

To facilitate the process, BB also instructed banks to prioritize Krishak Smart Card holders while extending loans from the refinancing fund for marginal and landless farmers, sharecroppers, small account holders and micro-enterprises.

The move is aimed at ensuring that affected farmers can obtain working capital quickly for crop rehabilitation, purchasing agricultural inputs and continuing farming operations despite weather-related setbacks.

The central bank, however, clarified that eligible farmers should not be denied access to loans solely because they have not yet received a Krishak Smart Card.Finance Daily Reports

Bangladesh Bank said the special emphasis on flood-affected farmers reflects its commitment to supporting rural communities facing climate-induced challenges and maintaining food production across the country.

All other provisions of the existing refinancing scheme will remain unchanged, the circular added.

US President Donald Trump signed an order Monday to cut tariffs on agricultural equipment, the White House said, as farmers and manufacturers face pressure from surging costs over the Middle East war.

Trump's proclamation reduces the duty rate on machinery like harvesters, alongside certain other equipment, from 25% to 15%.

Foreign companies can also qualify for a 10% duty rate if their manufacturing equipment contains at least 85% US steel or aluminum, the White House added in a fact sheet.

The changes take effect on June 8 and last until December 31, 2027.

Farmers have raised concern over rising costs ahead of key midterm elections, and face a further squeeze from the Middle East war as diesel and fertilizer prices have surged.

US-Israeli strikes targeting Iran since the end of February sparked Tehran's retaliation that virtually blocked off the Strait of Hormuz.

The critical waterway normally sees about a fifth of the world's oil and gas supplies pass through it, and is also essential for the global fertilizer trade.

The blockage has also driven aluminum prices higher as it is a key passageway for deliveries from the Middle East.

"Recent circumstances have affected and are affecting domestic industries that use agricultural equipment, industrial equipment and machinery, and other related products," Trump's order on Monday noted.

It is the latest adjustment to Trump's steel and aluminum tariffs, after firms pushed back on onerous rules.

US tariffs on steel, aluminum and copper generally stand at 50%.

In April, Trump moved to lower tariffs on products deemed to contain substantial amounts of these metals to 25% -- targeting their full value rather than the amount of the metals they contain -- in a bid to simplify the system.

Besides agricultural equipment, Trump's latest order said the lower 15% rate would also apply to certain heating, ventilation and air conditioning systems that are mainly for residential use.