South Korea will invest nearly $1.2 trillion -- equivalent to more than two-thirds of its GDP -- in a new chip-building hub and AI data centres over several years, as it seeks to profit from soaring demand while developing previously neglected regions.

The enormous cash injection comes as Asia’s fourth-largest economy rides high on a global AI boom -- with South Korean memory chipmakers emerging as a crucial cog in the fast-moving industry.

“Speed is the only path to survival. We must secure the core elements of artificial intelligence faster than any other nation,” President Lee Jae Myung said in Seoul at an event to unveil the public-private collaboration.

Samsung Electronics and SK Hynix will make a record investment of 800 trillion won (around $520 billion) in a new semiconductor fabrication hub in the country’s southwest, the government said.

Both companies have seen profits and share prices skyrocket in recent months, as frenzied demand for AI infrastructure squeezes the global supply of memory chips.

The government also announced a separate investment of a quadrillion won (around $650 billion) in AI data centres over the next 10 years.

The plans are in line with Lee’s agenda for industrial development in regions outside the capital, and Industry Minister Kim Jung-kwan said the Samsung-SK Hynix project will comprise four fabrication plants.

“We will develop the southwestern region into a second semiconductor production hub,” he said. Samsung Electronics and SK Hynix will each build two plants under the 800 trillion won project, according to Kim’s presentation slide.

“Permit approvals and construction timelines will be dramatically shortened to rapidly expand production capacity,” Kim said.

“Through this, we will maintain an overwhelming market leadership and a decisive technological gap in the memory semiconductor sector.”

Science Minister Bae Kyung-hoon announced that the country will invest 550 trillion won on AI data centres by 2029.

“By 2035, an additional 10-gigawatt AI data centre will be built, with a total investment exceeding 18.4 gigawatts and 1,000 trillion won.”

The new investment is by far South Korea’s largest.

The southwestern region of Honam -- a traditional liberal stronghold encompassing Gwangju and the Jeolla provinces -- has long lagged behind the more industrialised southeast.

This disparity dates back to rapid economic development under former president Park Chung-hee in the 1960s and 70s.

But without incentives for companies to voluntarily relocate, the massive investment could backfire, warned Kim Dae-jong, a professor of Business Administration at Sejong University.

This could, in turn, hurt the nation’s semiconductor competitiveness.

“It is essential to minimise the financial burden, amounting to hundreds of trillions of won, as well as the time-related risks faced by companies,” said Kim.

RENEWABLES

Analysts say there are abundant renewable electricity resources in the southwest, making it possible for companies to meet their commitments to boosting green energy use.

But they caution that building an entirely new semiconductor manufacturing ecosystem away from the existing industrial base around Seoul would require significant time and investment.

“Establishing production lines from scratch could take more than five years,” Lee Jong-hwan, a semiconductor engineering professor at Sangmyung University, told AFP.

“The biggest challenge is that most skilled workers and suppliers remain concentrated around the Seoul metropolitan area.”

Concerns were also raised about heavy demand for water. President Lee wrote on X on Saturday that “assessments indicate it is possible to supply one million tons of industrial water per day” in the region.

The announcement comes as South Korea debates how the enormous profits generated by the global AI-driven semiconductor boom should be shared more broadly across society.

Kim Yong-beom, the president’s chief policy secretary, in May suggested using excess AI-related tax revenue to fund startup support for young people, basic income programmes for rural and fishing communities, and assistance for artists.

The boom has also fuelled worker demands over pay packages, with Samsung averting a major strike in May by agreeing a deal on bonuses with its largest union.

Veon, the parent company of Banglalink, has proposed a $1 billion investment initiative in Bangladesh, with an immediate commitment of $250 million, as the global digital operator seeks to expand its presence in the country’s digital economy.

The proposal was discussed during a meeting between Prime Minister Tarique Rahman and Veon Chairman Augie Fabela at the Prime Minister’s Office in Jatiya Sangsad Bhaban yesterday morning.

Called “Invest in Bangladesh NOW!”, the initiative is a joint public-private proposal with the Ministry of Post, Telecommunications and ICT aimed at attracting more foreign direct investment into the country’s digital sector.

According to a public official familiar with the discussions, the initiative will focus on next-generation digital infrastructure, digital services, digital banking, artificial intelligence and mobile financial services.

In general, the goal is to position Bangladesh as a leading destination for global digital investment, according to the official.

In a statement issued in the evening, Banglalink said that, beyond its own investment, Veon plans to use its global network to encourage other international investors to explore opportunities in Bangladesh’s rapidly growing digital economy.

Augie K Fabela II, founder and chairman of the Board of Veon Group, said, “We are a long-term partner in Bangladesh’s journey toward becoming a trillion-dollar economy. Through the ‘Invest in Bangladesh NOW’ initiative, Veon is prepared to serve as the anchor investor in an ambitious programme designed to help attract $1 billion in foreign direct investment.”

“Alongside our own investment, we will actively engage international partners to unlock Bangladesh’s tremendous potential. We are fully aligned with the government’s vision for digital and financial transformation and stand ready to support that vision through long-term investment, innovation, and partnership,” added the Veon board chairman.

During the meeting, Prime Minister Tarique Rahman urged Banglalink to make smartphones more affordable and consider further reducing internet prices so digital services become accessible to people from all walks of life.

According to a media release from the Prime Minister’s Press Wing, the PM stressed the need to expand digital inclusion by ensuring that people from all socioeconomic backgrounds can own smartphones and access affordable internet services.

Post, Telecommunications, Information Technology and Science and Technology Minister Faqir Mahbub Anam, Prime Minister’s Adviser on ICT Rehan Asif Asad, Veon Board Member Michiel Soeting and Banglalink Chief Executive Officer Johan Buse also attended the meeting.

The investment proposal comes as Veon seeks to expand its presence in Bangladesh through strategic partnerships and acquisitions.

In a recent letter to the prime minister, the Dubai-headquartered company expressed interest in a strategic combination with state-owned mobile operator Teletalk as part of its broader expansion plans. It also said it was prepared to significantly increase its investment in Bangladesh and requested discussions on potential collaborations involving strategic public assets.

The proposal also includes a possible acquisition of Nagad from the Bangladesh Post Office.

According to sources, Veon is among several foreign companies that have expressed interest in investing in or acquiring a stake in Nagad.

Veon said it has already applied for a digital bank licence and received a no-objection certificate from the Bangladesh Bank to operate as a payment service provider.

The company said it has invested more than $2.5 billion in Bangladesh over the past two decades through Banglalink and contributed more than $4 billion to the national exchequer during that period.

The government has proposed removing the minimum share offload requirement for companies to qualify for a corporate tax rebate upon listing on the stock market, aiming to encourage more businesses to go public.

Speaking during the budget discussion in parliament today (29 June), Finance Minister Amir Khosru Mahmud Chowdhury proposed a 2.5% reduction in corporate tax for any company immediately after it lists on a stock exchange, regardless of the percentage of shares offered to the public.

Under the existing tax regime, companies must offload at least 10% of their shares to qualify for the rebate.

The finance minister also proposed an additional 2.5% corporate tax rebate for companies that float at least 10% of their shares through an Initial Public Offering (IPO), Direct Listing, Rights Issue or Repeat Public Offering (RPO).

The proposed budget also includes a further 2.5% tax incentive for both listed and non-listed companies that conduct all business transactions through banking channels.

If implemented, listed companies that transact entirely through banks and float at least 10% of their shares would enjoy a total corporate tax reduction of 7.5 percentage points compared with non-listed firms.

The budget also proposes reducing the tax rate on dividend income to 20% for corporate taxpayers and 15% for individual investors.

In another move to support the capital market, the government has proposed removing the existing Tk5 lakh investment ceiling for claiming tax rebates on investments in mutual funds.

The finance minister also proposed continuing the tax exemption on income earned from zero-coupon bonds.

Speaking in parliament, Amir Khosru said the proposed fiscal measures are intended to strengthen the capital market by encouraging more quality companies to list and by facilitating long-term investment for industrialisation.

He said investor confidence in the stock market had shown signs of improvement, reflected in recent gains in market indices, adding that the government would continue implementing structural and fiscal reforms to deepen the capital market.

The exchange rate of the US dollar against the taka rose further today as banks faced increased payment pressure and settled letters of credit (LCs) ahead of the June-end closing.

Today, City Bank bought the US dollar at Tk 122.60 and sold it at Tk 123.60. A day earlier, the bank's buying rate was Tk 122.40, while its selling rate was Tk 123.40.

Similarly, Eastern Bank bought the US dollar at Tk 122.60 and sold it at Tk 123.60 today. A day earlier, its buying and selling rates stood at Tk 122.50 and Tk 123.50, respectively.

Meanwhile, the weighted average exchange rate of the US dollar rose to Tk 122.85 today from Tk 122.75 two days earlier, according to data from Bangladesh Bank.

Bankers said the dollar appreciated mainly due to payment pressure ahead of the June-end closing.

At the same time, remittance inflows have slowed compared with the two Eid months, creating a slight shortage of US dollars in the market.

During the first 28 days of June, Bangladesh received $2.58 billion in remittances, up just 1.8 percent from the same period a year earlier, according to Bangladesh Bank data.

In May, however, remittance inflows reached $3.42 billion, marking a 15.34 percent year-on-year increase as migrant workers and Bangladeshis living abroad sent more money home ahead of Eid-ul-Azha.

The treasury head of a private commercial bank told The Daily Star that banks are currently busy settling LCs for government imports and debt servicing before the June-end closing, which has pushed up demand for the US dollar.

He, however, said the increase in the dollar's exchange rate is unlikely to be sustained, as remittance inflows are expected to pick up in the coming days.

Bangladesh Bank (BB) has instructed banks to maintain the average gap between loan and deposit interest rates within a specific limit, setting the maximum interest rate spread at 4 percent.

The newly imposed ceiling will be applicable to all types of loans, except for credit cards and consumer credit, reports UNB.

The Banking Regulation and Policy Department (BRPD-1) of the central bank issued a circular in this regard on Monday, sending it to the managing directors and chief executive officers of all banks for immediate execution.

According to the circular, the previous directives regarding the interest rate spread were withdrawn on November 29, 2023, following the introduction of the SMART (Six-Month Moving Average Rate of Treasury Bill) and margin-based interest rate system.

Later, on May 8, 2024, a fully market-driven interest rate mechanism was launched without any regulatory ceiling on the intermediation spread.

However, the central bank noted that several banks have recently been setting interest rates on loans significantly higher than their deposit rates, leading to an abnormal expansion of the weighted average interest rate spread.

This trend has escalated the cost of borrowing for trade, industry, and production sectors, creating a negative impact on overall economic activities and investment.

Against this backdrop, BB issued the new directive to keep borrowing costs logical across various sectors. However, the 4 percent limit will not be applicable to credit card loans and consumer credit.

Bangladesh Bank rolls out its next monetary policy today (Tuesday) amid indication that the central bank will maintain its tight stance for another six months to rein in inflation and stabilise the exchange rate.

The Monetary Policy Statement (MPS) for the first half (July-December) of the imminent fiscal year (FY2026-27) is set for the announcement by BB Governor Md. Mostaqur Rahman at a press conference at the central bank headquarters in Dhaka at 3:00pm, officials have said.

This will be the first monetary policy statement by the governor after he took charge of the central bank leadership on February 25 last. The banking regulator is going to announce the half-yearly MPS at a very critical period of time when inflationary pressure keeps rising notwithstanding the central bank maintaining a tight monetary-policy stance since October in 2024.

On the other hand, businesspeople have requested the central bank to take immediate measures to lessen higher lending rate amid persisting economic sluggishness.

Under such circumstances, the MPS will become a crucial one in the current macroeconomic context.

BB officials have said all policy rates are likely to remain unchanged as the central bank aims to closely monitor inflation trends over the next couple of months before deciding on its next course of action.

"We have formulated our latest monetary policy with top priority given to curbing inflationary pressure in the economy while keeping the exchange rate stable," a senior BB official told The Financial Express, replying to a query.

According to data with Bangladesh Bureau of Statistics (BBS), the headline inflation rose to 9.42 per cent in May 2026. The inflation rate was 9.04 per cent in the previous month of April.

The central banker, however, hints at a slight upward revision in the private-sector-credit-growth projection for the H1, despite a declining trend in recent months.

The Bangladesh Bank (BB) expects inflation to ease further in the coming months, saying its tight monetary policy has kept real interest rates positive and close to their estimated natural level, even as subdued private investment and mounting external uncertainties weigh on growth.

The findings are part of the central bank’s Monetary Policy Review 2025-26, which compared the current policy stance with a model-based estimate of the natural rate of interest.
The review comes as BB is set to unveil the Monetary Policy Statement (MPS) for the July-December period at 3:00pm today at its headquarters, with the rate widely expected to remain unchanged at 10 percent, according to officials.BB has kept the policy rate, the rate at which commercial banks borrow from the central bank, unchanged at 10 percent since October 2024, following 11 consecutive hikes between May 2022 and October 2024.“To curb persistent inflation, stabilise the foreign exchange market, and preserve the resilience of the external sector, Bangladesh Bank maintained its contractionary monetary policy stance by keeping the policy rate at 10 percent throughout the January 2025–June 2026 period,” BB Governor Md Mostaqur Rahman said in the report.

The report credited improving domestic supply conditions, together with its restrictive stance, for helping bring down inflation after more than two years of persistent price pressure. Point-to-point headline inflation fell to 8.49 percent in December 2025, from 10.89 percent a year earlier, though it remained above BB’s 7 percent target ceiling.

More recent data, however, suggest that progress has partly reversed.In the report’s foreword, BB Governor Md Mostaqur Rahman said inflation stood at 9.42 percent in May 2026, up from 8.48 percent in June 2025.He said Bangladesh’s economy had shown resilient signs of recovery in FY26 despite domestic structural challenges and dual global headwinds, including escalating geopolitical tensions and reciprocal tariff measures.The review noted that the global economy performed better than expected in 2025, supported by strong demand, resilient trade, fiscal stimulus in major economies, and increased investment in technology and artificial intelligence.However, it cautioned that growth prospects remain constrained by weak private investment, slowing export momentum, and external headwinds arising from external headwinds.

As per the report, geopolitical tensions in the Middle East continue to pose significant short-term risks. Global inflation is also expected to edge up in 2026 due to disruptions in energy supplies, higher commodity prices, renewed exchange-rate pressures, and rising transportation costs.

As a commodity-importing economy, it said, Bangladesh remains exposed to global energy and food price shocks that could push up import costs and strain the external sector.

Despite these challenges, BB remains optimistic that government social protection programmes, continued support for productive sectors, and its Tk 60,000 crore stimulus package would boost domestic consumption, encourage private investment, and support exports.

The central bank said it would continue to closely monitor both domestic and external developments to maintain price stability and safeguard macroeconomic stability.

The governor expects Bangladesh’s economic outlook to improve significantly, supported by the successful implementation of ongoing initiatives, structural and institutional reforms undertaken by the current government, and well-coordinated monetary and fiscal policies.

Corporate-tax incentives are broadened in the Finance Act 2026 by extending a 2.5-percentage-point rebate for a slew of businesses while retaining the existing 20-percent tax on dividend incomes of corporates.
FE

No taxing of retailers and no black-money-whitening scope either in the new budget while income-tax threshold rises to Tk0.4 million at the prime minister's request as parliament Monday passed the Finance Bill with such major amendments.

The Finance Bill, which ratifies government's fiscal proposals, expands the scope of the tax rebate for companies that conduct all their business transactions through the banking system.

Previously, the cut-down corporate-tax rate was available only to certain listed companies. The benefit now extends to other eligible businesses.

"The move is aimed at encouraging businesses to use formal banking channels and mobile financial services (MFS) in order to improve financial transparency and promote digital financial transactions," says tax-expert Lutful Hadee, a noted accounting professional.

However, he notes that the condition requiring all business transactions to be routed through banks may be difficult for many enterprises to meet because of the country's still-developing digital-payment infrastructure.

He suggests allowing a reasonable proportion of cash transactions while retaining the tax benefit as he thinks such flexibility would make the incentives more practical and effective.

Income Tax Policy First Secretary Md Jafor Imam says the facility would be available to companies currently taxed at rates ranging from 22.5 per cent to 27.5 per cent, meant for publicly-listed and non-listed companies both.

"However, companies enjoying special tax rates on the basis of nature of their businesses will not be eligible for the rebate," he adds.

On abolition of the existing 20-percent tax on dividend income earned by corporate entities, Mr Hadee says the current tax treatment will remain unchanged, easing concerns among institutional and corporate investors who had opposed the proposed revision in the bill.

The legislation also expanded tax incentives for listed companies by bringing Repeat Public Offerings (RPOs) under the existing tax-benefit framework, alongside Initial Public Offerings (IPOs) and Direct Listings.

Under the revised provision, listed companies raising capital through RPOs will be eligible for the tax incentives if they increase public shareholding to at least 10 per cent of their paid-up capital. The measure is expected to encourage greater free float and help deepen the country's capital market.

The government has also introduced a flat 15-percent tax on dividend incomes of individual taxpayers.

Finance Minister Amir Khosru Mahmud Chowdhury moved the Finance Bill 2026, which was passed by voice vote, with Speaker Hafiz Uddin Ahmad, Bir Bikram, in the chair.

Under the Finance Bill, placed in parliament on June 11 along with the 2026-27 national budget, such dividend income was proposed to be taxed at a flat rate instead of being added to total taxable income and taxed according to the applicable income-tax slabs.

The new measure is expected to reduce the tax burden on individual investors and encourage greater investment in the stock market. Other major amendments to the Finance Bill include the withdrawal of the proposed specific VAT for small and retail businesses, a reduction in the tax rate for private universities to 5.0 per cent and withdrawal of the proposed mandatory requirement for obtaining Taxpayer Identification Number (TIN) to open bank accounts.

The bill also provides for tax exemptions on salary income for indigenous communities living in the three hill districts and the plains both, in addition to existing exemptions on income from business, agriculture, and other economic activities.

Furthermore, customs duty, regulatory duty, supplementary duty, and VAT on imported shrimp feed, probiotics, vitamins, minerals, other essential inputs, and related machinery have been withdrawn.

The government has also reduced the import duty on PVC and PET resin-widely used industrial raw materials-from the proposed 10 per cent to 5.0 per cent, providing relief to domestic manufacturers.

Shoeniverse Footwear Ltd, an export-oriented footwear manufacturer under the National Polymer Group, has signed an issue management agreement with LankaBangla Investments for its proposed initial public offering (IPO).

The agreement was signed by Riad Mahmud, managing director of Shoeniverse Footwear, and Iftekhar Alam, chief executive officer of LankaBangla Investments. The signing ceremony was attended by Syed Ahmed, chief financial officer of National Polymer Group, Estiuque Uddin, head of primary market services at LankaBangla Investments, along with senior officials from both organisations.

Established in 2017, Shoeniverse operates a green manufacturing facility in Mymensingh with a production area of around 231,718 square feet and a workforce of more than 2,700 employees. The company manufactures synthetic footwear for export markets, focusing on quality, innovation and sustainable production.

Riad Mahmud also serves as president of the Bangladesh Association of Publicly Listed Companies (BAPLC).Financial Planning Tools

The company is undertaking a major capacity expansion programme to increase production and strengthen its competitiveness in the global footwear market amid rising export demand.

Subject to approval from the Bangladesh Securities and Exchange Commission (BSEC), the proposed IPO is expected to support Shoeniverse’s expansion plans, enhance its production capacity and reinforce its position in Bangladesh’s growing footwear export industry.

LankaBangla Investments is one of the country’s leading investment banks and has been actively involved in managing IPOs and other capital market transactions.

Gold prices eased on Monday as recent US-Iran strikes in the Gulf pushed oil prices higher, while expectations of US Federal Reserve interest rate hikes further weighed on the non-yielding metal.

Spot gold was down 0.7 percent at $4,061.51 per ounce, as of 0747 GMT. US gold futures for August delivery lost 0.5 percent to $4,076.20. The metal was headed for a fourth consecutive monthly loss of 10.5 percent.“US and Iran were at it again over the weekend, with fresh military strikes reported from both parties, which casts further doubt over how long oil can stay at these subdued levels and therefore over the broader inflation and interest rate outlook,” said Tim Waterer, chief market analyst at KCM Trade.Oil prices rose after Iran launched missiles and drones at US military sites in Kuwait and Bahrain early on Sunday, shortly after US President Donald Trump threatened to wipe out the Iranian leadership if they did not stick to the agreement to end their war.

However, Tehran and Washington agreed to halt recent hostilities in the Gulf and renew talks regarding their dispute over the Strait of Hormuz, a US official said on Sunday.

Elevated crude oil prices can fuel inflation and chances of interest rate hikes, and while gold is typically seen as an inflation hedge, it loses its appeal as a non-yielding asset in a high-interest-rate environment.

Traders expect three Fed rate hikes this year and are pricing in an about 80 percent chance of a December increase, according to the CME FedWatch Tool.

Investors are now looking out for June’s ADP employment data and the US nonfarm payrolls data, both due later this week, to further gauge the Fed’s monetary policy stance.

“Gold could see the $5,000 level again this year but this would be based on further de-escalation, oil having a sustained move to pre-war levels to dull the inflationary impact of the conflict, and a softer dollar,” said Waterer.

A delegation from the Chittagong Stock Exchange PLC (CSE) held a meeting with Bangladesh Bank (BB) Governor Md Mostaqur Rahman on Monday to discuss strengthening the capital market to support private sector financing and sustainable economic growth.
FE

CSE Chairman AKM Habibur Rahman led the delegation at the meeting that took place at the central bank headquarters in the afternoon.

During the meeting, the BB governor emphasised that private sector credit and investment growth need to gradually rise to 10 percent to achieve the country’s desired economic growth.

To attain this goal, he highlighted the critical importance of building a strong, deep, and dynamic capital market alongside the banking sector.Bangladesh Investment Opportunities

“An expanded capital market will enhance long-term equity financing opportunities for entrepreneurs, reduce excessive dependence on bank loans, and create an effective alternative source to meet the growing financing demands of the private sector,” Mostaqur Rahman said.

He expressed optimism that if the capital market can increase its market capitalisation by at least Tk20,000 crore in the fiscal year 2026-27, Tk25,000 crore in FY28, and Tk 30,000 crore in FY29 with the trend continuing in subsequent years, it will evolve into a powerful source of private sector financing.

The BB governor said this expansion will alleviate pressure on bank loans, broaden long-term investment avenues, and facilitate sustainable economic growth through targeted credit expansion.

Addressing foreign investment, he noted that Bangladesh Bank recently amended the regulations regarding Non-Resident Investor’s Taka Accounts (NITA) to ease the repatriation process of sale proceeds from shares and securities for foreign portfolio investors.

According to the revised guidelines, sale proceeds will now be deposited directly into the respective NITA accounts, and authorised dealer banks will ensure the deduction and deposit of applicable capital gains tax into the government treasury.

This policy update aims to make the process smoother, faster, and more cost-effective for foreign investors.

The CSE delegation also included Managing Director M Shaifur Rahman Mazumdar, and General Managers Md Mortuza Alam and Mohammad Monirul Haque.

The government has withdrawn a provision that would have allowed taxpayers investing unaccounted money in the real estate sector to do so without scrutiny over its source, following widespread criticism.

The amendment was passed in parliament today (29 June) through the Finance Bill.

Earlier, the government had proposed that if a taxpayer disclosed actual investment beyond the declared deed value in previous real estate transactions, no authority would question the source of that additional money.
Critics argued that such an indemnity provision would effectively enable the whitening of illicit funds, as it removed the requirement to explain the origin of undeclared wealth.

The Centre for Policy Dialogue (CPD) had also criticised the proposal, warning that it could open the door for legitimising black money.

Under the revised framework, unreported income can still be invested under existing rules by paying regular tax rates along with an additional 10% penalty.

However, unlike the scrapped provision, this route will not offer immunity, meaning authorities can still question the source of funds.

Officials said this effectively closes the scope for unrestricted investment of undisclosed income in real estate, while retaining a regulated disclosure mechanism with penalties.

The government has raised the tax-free income threshold by Tk 25,000 to Tk 400,000 for the next tax year, departing from its original budget proposal to keep the exemption limit unchanged.

As a result, individuals earning up to Tk 400,000 between July 2025 and June 2026 will not have to pay income tax, reports bdnews24.com.

The change came after Prime Minister Tarique Rahman proposed an amendment during discussions on the national budget in parliament on Monday.

The government has proposed cutting corporate tax rates by 2.5 percentage points for companies that conduct all their transactions through banking channels, responding to longstanding calls from the business community for lower corporate taxes.
Finance and Planning Minister Amir Khosru Mahmud Chowdhury announced the proposal during his closing speech at the budget session in parliament on Monday.

Few phrases have dominated public discourse in Bangladesh over the past several years as much as these two words. They have haunted households and policymakers alike.

The impact is felt daily. Travelling a short distance by rickshaw in Dhaka for Tk 10 is a thing of the past. A bundle of leafy vegetables for Tk 10 requires hard bargaining with the floating vendor in neighbourhood alleys. Prices have risen so much that Tk 100 vanishes into a vegetable bag soon after it comes out of the wallet.

For a four-member family, keeping weekly bills for vegetables, eggs and other essentials within Tk 500 has become nearly impossible. That note now buys far less than it did two years ago. And there is no sign of prices cooling.

The Bangladesh Bank (BB) has maintained a contractionary monetary policy stance since the first half of fiscal year 2023-24 to make money more expensive and tame excess demand to curb inflation. It started raising the policy rate, or repo rate – at which it lends to commercial banks – in May 2022 and hiked it to 10 percent in October 2024. The rate is yet to come down.

Yet inflation – a measure of the increase in the prices of a basket of goods and services purchased by an average consumer – remains stubborn.

Month-on-month inflation stood at 9.42 percent at the end of May, with the 12-month average above 8.6 percent, indicating that overall inflation is likely to hover well above the BB’s target of 7 percent at the end of June this year.

This would be at least the sixth consecutive year inflation has exceeded the central bank’s targets. In FY25, average inflation hit 10 percent, more than 2 percentage points above target. The year before, it was 9.73 percent in June 2024, 2.23 percentage points above the BB’s goal.

Similarly, actual private-sector credit growth fell short of its targets set in the successive monetary policies.

In April 2026, it expanded by only 4.75 percent year-on-year, against a BB target of 8.5 percent by end-June. In April 2025, private-sector credit growth was 7.50 percent.

Public-sector credit growth, by contrast, exceeded its projected level.

The question is, why? What’s wrong with monetary policy that has failed to contain spiralling prices meaningfully, reverse sluggish demand and accelerate economic activity?

In its recent monetary policy statements, the BB attributed persistently high inflation to a combination of factors – the Russia-Ukraine war and conflicts in the Middle East, a more than 40 percent depreciation of the taka against the US dollar, and volatility in global commodity prices.

Domestically, years of a lending rate cap at 9 percent kept real interest rates negative for a while, repeated fuel and energy price hikes led to higher production and transportation costs, and government continued to borrow heavily to finance budget deficits.

This coincided with domestic production and supply disruptions caused by recurrent floods and rising inflation expectations, causing prices to trend upward.

FISCAL AND MONETARY FAILURES

Birupaksha Paul, professor of economics at the State University of New York at Cortland and a former chief economist at the BB, argues inflation has remained high “because of both fiscal and monetary failures.”

“The government has increased its borrowings to one of the highest levels, which is inflationary. On the other hand, the central bank’s liquidity support to cash-hungry banks is also inflationary. These two channels are thwarting monetary tightening with high policy rates,” he said.

The BB has so far provided Tk 75,903 crore in emergency liquidity assistance to banks facing cash shortages as of June 6, Finance Minister Amir Khosru Mahmud Chowdhury told parliament last week.

Meanwhile, the government’s net borrowing from the banking system surged more than threefold to Tk 1,04,410 crore during July–April of FY26, from Tk 30,405 crore a year earlier.

Birupaksha said high interest rates have also contributed to limited credit growth, while its weakness also stems from institutional failures such as non-inclusive politics, extortion by political thugs, and the poor law and order situation.

“The government failed to stimulate business confidence by adequately supporting the closed or vandalised mills and factories. It’s a new type of fiscal-monetary trap that adds fuel to inflation and delivers a damper to private credit growth,” he said.

INFLATION IS NOT DEMAND-DRIVEN

Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), has a different reading.

She argues monetary policy has had limited success in achieving its key objectives for several reasons, primarily because inflation has not been driven by demand.

“Supply-side disruptions, exchange rate depreciation, higher import costs, and inefficiencies in domestic markets have all played a major role. Monetary policy, on its own, cannot easily solve this,” said Fahmida, also a director on the BB’s board.

For private-sector credit, she said high borrowing costs are only a part of the story. Weak investor confidence, energy shortages and policy uncertainty are also responsible.

“That is why we have seen earlier that when companies are reluctant to invest due to the lack of an enabling environment, simply adjusting interest rates is unlikely to generate the desired increase in private credit,” she said.

According to her, monetary policy should be supported by prudent fiscal policy and broader structural reforms that improve the investment climate, ease supply constraints, and strengthen market competition. “Without such policy coordination, bringing inflation under control while also stimulating investment and growth will remain a difficult balancing act.”

UNFAVOURABLE CIRCUMSTANCES

Deen Islam, professor of economics at Dhaka University, said the latest monetary policies of the BB failed to achieve their objectives not only due to the inadequacy of the policy rate but also owing to unfavourable circumstances.

“It should be noted that the rise in prices was caused mostly by supply-side factors, higher import prices, exchange rate effects, and market rigidity, whereas the banking sector was too weak to transmit policy signals effectively,” he said.

At the same time, private credit remained subdued because both banks and borrowers became cautious.

“Therefore, the next monetary policy should not only announce a rate stance; it should explain the transmission strategy: how BB will anchor inflation expectations, restore credit discipline, support productive lending, coordinate with fiscal policy, and rebuild confidence in the banking system,” he added.

The government is likely rolling back several budget proposals for FY2026-27, including a package VAT on retail businesses and a mandatory TIN for opening bank accounts, while raising the personal tax-free income limit to Tk4 lakh.

The government may also abandon its plan to introduce a new package-style VAT, known as a "specific VAT," on small retail businesses. The move comes amid concerns over inadequate implementation preparedness and the risk of harassment of small traders at the field level.

The government is also considering raising the tax-free income threshold for individual taxpayers from Tk3,75,000 to Tk4 lakh for the next tax year, with the same threshold likely to remain in place for 2027-28. It may be further increased to Tk4.5 lakh for tax years 28-29 and 29-30, and Tk5 lakh for 30-31.

In addition, the proposed 15% capital gains tax on landowners in land development projects may be reduced to 5%.

TIN for new bank accounts may go

The proposal included in the Finance Bill to make a Taxpayer Identification Number (TIN) mandatory for opening bank accounts is also likely to be withdrawn. Sources involved in the budget process at the National Board of Revenue (NBR) said changes may also be made to the personal income tax slabs.

Low chance of VAT on retail businesses

Speaking to The Business Standard on condition of anonymity, a senior NBR official said, "The likelihood of implementing the proposed specific VAT at the retail level this year is low."

He said the initiative was part of a broader plan to expand the VAT net but acknowledged that the necessary groundwork has not yet been completed.

"The required preparations are still lacking. There are concerns that implementation could create confusion, lead to harassment of businesses and ultimately increase consumer prices. As a result, the proposal may not be implemented for now," he said.

"The government may conduct further studies before moving ahead with the proposal," he added.

Under the plan, businesses with annual sales or turnover below Tk50 lakh would have been required to pay a fixed monthly VAT based on their location. The NBR also planned to simplify VAT registration for such businesses and automatically deduct the tax from their bank accounts. A new regulation was expected to be issued to facilitate the scheme.

The proposed monthly VAT ranged from Tk1,000 to Tk10,000.

During the budget discussion in parliament on 24 June, Finance Minister Amir Khosru Mahmud Chowdhury said the government planned to bring 16 retail and service sectors, including grocery and cosmetics shops, under the specific tax regime in FY2026-27.

The proposed specific tax is essentially a package VAT system that had previously been in place but was later abolished.

Mustafizur Rahman, distinguished fellow at Centre for Policy Dialogue (CPD), welcomed the government's latest plans as positive steps.

"There is a need to expand the VAT base by bringing the retail sector under the VAT net. However, this should be preceded by further study to ensure that implementation does not create unnecessary complications" he told The Business Standard.

Referring to reports that the government may raise the tax-free income threshold, he said, "The proposal is reasonable. We (CPD) had recommended setting the tax-free income threshold in line with inflation."

He added, "The 5% tax on low-income taxpayers should also be retained. Otherwise, the tax burden on middle-class taxpayers will increase."

He also said the proposal to make TIN mandatory for opening bank accounts should be dropped, noting that many people do not have taxable income. "Making TIN compulsory for opening a bank account would create an unnecessary burden on them."

Meanwhile, the Bangladesh Shop Owners Association held a press conference yesterday demanding that the government withdraw the proposal.

Association leaders warned that, if implemented, the measure would expose small and micro businesses to widespread harassment by VAT officials. They also argued that it could create serious disruption in the small and medium-sized enterprise (SME) sector, ultimately undermining the government's public support.

Speaking at the press conference held at the association's office in Moghbazar, association president Md Helal Uddin and other senior leaders urged the government to reverse its decision and abandon the proposed tax regime.

Weak public institutions are holding back Bangladesh’s economic growth and costing the country billions in lost tax revenue, the World Bank said yesterday, urging reforms to tax administration, procurement, auditing and project implementation.

“These are facts, but they are also symptoms of deeper structural issues. At the core of those issues are weak institutions,” said Jean Pesme, World Bank country director for Bangladesh, at the launch of the Strengthening Institutions for Transparency and Accountability (SITA) project in Dhaka.

Citing the WB’s Country-Level Institutional Assessment and Review based on 2023 data, Jean said Bangladesh ranks in the bottom quartile among upper-middle-income countries in eight of 13 institutional clusters. The areas include political institutions, social institutions, integrity, justice, human resource management, public finance, labour and social protection, and service delivery.

The costs are heavy. Jean pointed out that Bangladesh’s tax-to-GDP ratio stood at only 6.9 percent in fiscal year 2024-25, which is less than half of the roughly 15 percent considered necessary to finance the country’s development ambitions.

Around 70 percent of government revenue comes from indirect taxes, reflecting a narrow and inequitable tax base, he added.

According to the WB, public investment projects face average cost overruns of around 30 percent and implementation delays of about three years, while Bangladesh ranks 116th among 137 countries in infrastructure quality.

“Weaknesses in procurement and public investment management undermine infrastructure outcomes and public service delivery,” Jean said.

He described Bangladesh as being at an “inflection point”, with economic growth slowing over the past three years, fiscal pressures mounting, job creation weakening and external shocks exposing long-standing structural vulnerabilities.

Poverty reduction has also slowed, with 8.9 percent of the population projected to live below the $3-a-day poverty line in 2025.

“The next game for Bangladesh will depend less on policies alone and much more on how effectively institutions can implement them and close the execution gap,” he said.

He welcomed the government’s decision to separate tax policymaking from tax administration, calling it an important step toward stronger accountability and taxpayer confidence.

According to the WB official, the FY27 budget’s revenue and service delivery targets were ambitious but contingent on institutional capacity to deliver.

“It’s about outcomes and results,” he said, adding that the government’s emphasis on digitalising tax administration and improving compliance is consistent with the reform agenda supported by the WB.

The SITA project, financed by a $250 million WB credit, will seek to modernise five institutions: the National Board of Revenue (NBR), the Bangladesh Bureau of Statistics (BBS), the Bangladesh Public Procurement Authority (BPPA), the Office of the Comptroller and Auditor General, and the Planning Division.

Successful implementation of the project is expected to result in higher revenue collection, more efficient public spending, greater procurement transparency and stronger public auditing.

The WB urged authorities to accelerate the rollout of digital tax systems at the NBR, improve data accessibility and timeliness at the BBS, strengthen project selection and monitoring in the Planning Division and the IMED, expand the electronic Government Procurement (e-GP) system and fast-track audit reforms.

“The next 18 months are critical. Only early results will ensure credibility, public trust and reform momentum,” Jean said.

State Minister for Planning Jonayed Abdur Rahim Saki, who inaugurated the project, said the government is committed to strengthening public institutions through technology to improve transparency and accountability.

He said digitising core government agencies would improve revenue mobilisation, public financial management, auditing, procurement and development planning while helping curb corruption, misuse of public funds and money laundering.

Industrial production grew by only 2.86 percent in the outgoing fiscal year -- the slowest pace in recent memory. Yet the budget projects that growth will somehow jump to 7 percent next year and continue rising thereafter. Such an acceleration is not impossible, but it demands a transformation far deeper than anything currently underway.

This gap between performance and aspiration raises an uncomfortable question: why do the same constraints -- weak logistics, unreliable energy, low foreign investment, anti-export policy bias, and chronic skill shortages -- persist after decades of being diagnosed and rediagnosed? The answer cannot be ignorance. Policymakers have long understood these problems, and the solutions are hardly mysterious.

The persistence of these constraints points to something more structural. Industrial stagnation cannot be understood solely as the result of technical bottlenecks. It also reflects the institutional incentives that shape industrial policy, competition, and investment decisions. Understanding those incentives requires looking beyond the familiar explanations that dominate policy debates.

THE CONVENTIONAL EXPLANATION

The prevailing explanation traces Bangladesh’s industrial underperformance to weak state capacity, policy inconsistency, and short political time horizons rather than to the incentives shaping policy choices. Bureaucratic fragmentation, cumbersome regulations, inadequate infrastructure, fiscal constraints, and limited administrative capability make it difficult to implement coherent industrial strategies. Governments, whether democratic or authoritarian, also tend to prioritise visible short-term projects over long-term investments in education, energy, logistics, and institutional reform.

These explanations are neither trivial nor incorrect. Weak institutions, limited technical capacity, and political incentives all matter. But they are insufficient to explain why many of the same constraints have persisted for decades despite being widely recognised. Policymakers have long understood the importance of reliable infrastructure, export diversification, better logistics, and a more attractive investment climate. Technical knowledge is readily available, international experience is abundant, and development partners have invested heavily in building administrative capacity.

The more important question, therefore, is not why good policies are difficult to implement, but why the obstacles themselves prove so resilient. That requires looking beyond administrative shortcomings to the incentives embedded in Bangladesh’s political economy. Many of these constraints persist not simply because the state lacks capacity, but because they are embedded in an institutional equilibrium in which economic power, policy influence, and market privileges reinforce one another.

AN ECONOMY ORGANISED AROUND PROTECTED RENTS

One consequence of this institutional equilibrium is an economy increasingly organised around protected rents. Bangladesh’s large business groups played a critical role in the country’s economic transformation, investing when capital was scarce, creating jobs, and helping build a domestic entrepreneurial class. The problem is not the existence of powerful firms. Every successful industrialiser had them -- from South Korea’s chaebol to China’s state-owned and private conglomerates.

The challenge is that Bangladesh has not developed institutions capable of disciplining economic power in the service of industrial transformation.

Over time, much of the formal economy has become organised around protected incumbent firms. Large business groups have expanded across manufacturing, finance, logistics, telecommunications, media, and services, while economic power and policy influence have become increasingly intertwined.

In this environment, protection, subsidised credit, regulatory discretion, and market access can become entitlements rather than instruments for building competitiveness. Firms often face stronger incentives to preserve existing advantages than to pursue innovation, export expansion, or technological upgrading.

Viewed through this lens, many familiar bottlenecks become easier to explain. Regulatory complexity raises barriers to entry. Finance flows toward established relationships rather than productive newcomers. Persistent shortcomings in logistics, trade facilitation, and export competitiveness become easier to tolerate when firms can remain profitable without competing aggressively in global markets. Underlying these patterns is an institutional environment that rewards rents more consistently than productivity.

THE NARRATIVE THAT SUSTAINS THE SYSTEM

Economic structures endure not only because they generate profits for powerful groups. They also endure because they generate ideas that justify them.

In Bangladesh, industrial policy has long been shaped by a powerful narrative: Bangladesh is different. It must follow its own development path by nurturing domestic entrepreneurial capabilities and guiding industrial transformation through active state intervention. Over time, however, this developmental narrative has increasingly come to justify preserving established firms and exercising administrative discretion over market competition.

These arguments resonate because they contain important truths. No country has industrialised without building domestic entrepreneurial capabilities, and national development cannot be outsourced to foreign investors. The problem begins when nurturing domestic capability becomes synonymous with shielding incumbent firms from competition.

The result is that industrial policy becomes more concerned with preserving existing capabilities than creating new ones. The relevant question is no longer what firms contribute to structural transformation, but whether they reinforce that order.

The problem deepens when the success of incumbent firms becomes equated with the success of the economy itself. Industrial transformation is a process of continuous renewal in which firms enter, compete, grow, and, when they cease to be productive, exit. Yet policy increasingly focuses on preserving established firms rather than renewing the industrial ecosystem.

This bias is reflected in how policy responds to success and failure. Large firms in financial distress are treated as systemic concerns because of their size and employment, while the financing, market access, and technological constraints facing thousands of small and medium enterprises receive far less attention, even though their collective contribution is indispensable to employment, innovation, and industrial diversification.

WHAT EAST ASIA ACTUALLY DID DIFFERENTLY

The weakness of Bangladesh’s approach becomes clearer when contrasted with the East Asian experience.

East Asian success was not built on free markets alone. Nor was it built on suppressing large firms or rejecting foreign capital. Its defining feature was not simply disciplined rents but continuous industrial renewal. Governments used policy support not to preserve existing firms but to create conditions in which new firms could emerge, successful firms could grow, and resources could gradually shift away from less productive activities.

Governments provided protection, subsidised credit, tax incentives, and other forms of policy support. But these privileges were conditional rather than permanent. They were tied to export success, technological upgrading, productivity growth, and integration into global markets. Firms that failed to deliver lost state support.

This took different institutional forms across countries. South Korea disciplined the chaebol through export targets and directed credit while allowing weaker firms to exit. Taiwan fostered dense networks of small and medium enterprises that continuously generated new suppliers and exporters. China combined foreign investment, local experimentation, and competition among firms and regions to accelerate technological learning and industrial upgrading.

The common thread was not a particular industrial policy but a particular relationship between the state and business. Governments remained closely connected to firms while retaining sufficient autonomy to discipline them when national development objectives required it. This has been described as “embedded autonomy” -- a state embedded in business networks yet sufficiently autonomous to discipline them.

Bangladesh has achieved embeddedness. What it has struggled to develop is autonomy. Without that autonomy, support becomes difficult to withdraw, even when performance falls short.

That is the critical distinction. The issue is not whether governments create rents—every successful industrial policy does. The issue is whether those rents are conditional on performance or become permanent privileges. East Asia used state support not only to build globally competitive firms but also to continually renew its industrial base. Bangladesh has too often used it to preserve existing market positions.

GROWTH REQUIRES DISCIPLINE

If Bangladesh genuinely wants industrial growth to accelerate, it needs more than another package of incentives. Industrial policy must shift from discretionary privileges to transparent, performance-based support that rewards firms for exporting, innovating, upgrading technology, and raising productivity. That requires predictable rules, open competition, and a state capable of disciplining powerful economic actors in pursuit of broader developmental goals.

The government’s industrial growth projections implicitly assume that the existing system will generate East Asian-style dynamism. Yet East Asia’s success rested on institutions that linked privilege to performance, competition, and continuous industrial renewal. Bangladesh’s challenge is to build institutions that do the same. Without that discipline, industrial policy will remain focused on preserving today’s capabilities rather than creating tomorrow’s. Only then can the country build globally competitive industries.

The writer is the former lead economist of the World Bank’s Dhaka office.

The Dhaka Stock Exchange (DSE) has found the factory of Active Fine Chemicals closed during an inspection, raising the number of non-operational listed manufacturing companies to 33.Geographic Reference

The inspection, conducted on Thursday, is part of the bourse's ongoing drive to verify the operational status of listed companies and provide investors with a clearer picture of their actual business status.

According to DSE data, 32 listed manufacturing companies went out of operation between 2016 and Sunday, while another company has remained shut since 2002.

The list of non-functional companies becomes even longer when troubled financial institutions are taken into account. Five Islamic banks are currently undergoing merger, while five non-bank financial institutions (NBFIs) have been selected for liquidation.

Market analysts say the growing number of inactive listed companies exposes deep-rooted structural weaknesses in the country's capital market and highlights long-standing failures in regulatory oversight.

Many of these companies raised funds from the public through the stock market years ago but later became victims of sponsor disputes, financial irregularities, loan defaults, prolonged financial distress, or legal battles. Some failed to modernise operations or lost competitiveness amid changing market conditions.

Several manufacturing companies struggled with rising energy costs and persistent shortages of gas, making operations financially unviable.

Hamid Fabrics, for example, suspended factory operations in June last year, citing inadequate gas pressure. The company informed investors that production had already been disrupted for nearly two years before the worsening gas crisis forced a complete shutdown.

Appollo Ispat Complex has remained closed since October 2020. The manufacturer of Rani Marka Dheutin, which went public despite strong objections from the then finance minister AMA Muhith, fell into trouble within three years of listing after allegations of embezzlement involving its former directors.

Meghna Pet Industries has remained non-operational since 2002, making it the longest-closed company among listed firms. Company officials could not be reached for comment, as its page on the DSE website provides neither a contact number nor the name of the company secretary.

Market participants say the absence of timely regulatory intervention has allowed many troubled companies to remain listed years after production ceased.

The physical inspection is part of the exchange's broader initiative to verify the operational status of listed companies, said Md Sajedul Islam, shareholder director of the DSE.

In recent months, the exchange has intensified inspections as companies have not disclosed their operational status to investors.

Stock prices surged while factories remained shut

With factories remaining shut, machinery lying idle, and workers gone for long, several non-operational companies have posted sharp price increases on the bourses. Analysts suspect speculative trading and price manipulation behind the rallies.

Shyampur Sugar Mills, which has remained closed since December 2020, saw its share price jump about 42 per cent over the past month. The stock gained another 8.73 per cent on Sunday to close at Tk 225.50.

Khulna Printing & Packaging, whose factory has not been producing anything for more than two years, rose 8.61 per cent on Sunday to Tk 16.40, its highest level in a month.

In some cases, companies appear to exist only on paper. Familytex (BD), for instance, no longer has any physical manufacturing assets. A recent investigation by a special team from the Chittagong Stock Exchange (CSE) found that the company's factory and other assets had already been sold to a private entity.Geographic Reference

There are always some investors who are attracted to highly speculative stocks, said Saiful Islam, president of the DSE Brokers Association of Bangladesh (DBA). A segment of traders deliberately takes high risks, betting on sharp price swings rather than company fundamentals.

"They believe that once a stock starts rising, the relatively low free float of these companies makes it easier to drive prices further in their favour," Mr Islam added.

Analysts warn that continued trading of stocks of non-operational companies erodes investor confidence and damages the credibility of the capital market. They urge the regulator to take prompt action against the firms, saying cleaning up the trading board is essential to protect investors and foster the long-term development of the equity market.

Responding to concerns over the growing number of non-operational firms, Md Abul Kalam, executive director and spokesperson of the Bangladesh Securities and Exchange Commission (BSEC), said the stock exchanges are the frontline regulators and have the authority to take action against such companies.

"The stock exchanges can suspend trading or delist companies in accordance with the listing regulations," he added.

One of Bangladesh's leading industrial conglomerates, DBL Group, is preparing to list two of its sister concerns on the country's capital market as part of a broader strategy to strengthen corporate governance and gradually bring more of its businesses under public ownership.

The two companies are Parkway Packaging and Printing Limited and Thanbee Print World Limited. Both have already signed agreements with a local merchant bank to manage their Initial Public Offering (IPO) process.

According to the group's roadmap, if the IPOs of these two companies are completed successfully, another four to five companies will be listed on the stock exchange over the next four years.

Speaking to The Business Standard, DBL Group Vice Chairman M A Rahim said the group is currently preparing to bring both companies to the capital market. He noted that a similar attempt was made around one and a half years ago during the tenure of the interim government, but the process stalled after the regulator raised several queries.

"We responded to all of them. However, as the process became prolonged, we realised it was unlikely to move forward at that time. So, we decided to put the initiative on hold," he said.

He said the group revived the IPO plan after the new government assumed office, encouraged by its positive stance on the capital market and the economy, as well as its call for large, well-managed companies to join the stock market.

"We expect to complete the necessary documentation by November. Our target is to complete the IPO of at least one company by December, while the other is expected to come to the market in February or March 2027," Rahim said.

More companies to follow

Rahim said the successful listing of the two companies would pave the way for a series of future IPOs from the group.

"The pharmaceutical company will not be brought to the market now because it is still a relatively new business and needs a few more years to strengthen its financial base. We also want to wait a little longer before listing our ceramics business. Before those, we plan to bring some of our textile companies to the market. We aim to list one textile company by the end of 2027, followed by others in phases. Over the next four years, we hope to list at least four to five companies," he said.

'Our primary goal is not fundraising'

Rahim said raising capital is not the principal objective behind the IPOs. Instead, the group is focusing on building a stronger corporate governance framework for the future.

"At present, our four brothers jointly manage the business. As the family grows, not everyone will necessarily be involved in management. We want these companies to be run by professional management. Family members who wish to participate in the business can do so, while those who do not can remain shareholders and benefit from the companies' growth and dividend income," he said.

He added that the group wants to establish a sustainable corporate structure that will ensure good governance over the long term.

"Once listed, the companies will have independent directors, regular regulatory oversight, annual financial reviews and a much stronger corporate governance framework," Rahim said.

He also confirmed that both companies will seek listing on the main board, not the SME platform.

Planned use of IPO proceeds

According to Rahim, Parkway Packaging and Printing plans to raise around Tk70 crore through its IPO. The proceeds will be invested in expanding its carton manufacturing facility.

For Thanbee Print World, however, the fundraising amount has not yet been finalised.

"A decision will be made next week. Instead of raising a large amount, we are also considering listing the company by offering only 5% to 10% of its shares to the public because our primary objective is to strengthen corporate governance," he said.

Two companies at a glance

Parkway Packaging and Printing Limited began commercial operations in 2008. The company has a paid-up capital of Tk45 crore and an annual turnover of around Tk140 crore. It manufactures cartons and packaging products primarily for Bangladesh's readymade garment industry and has a production capacity of approximately 35,000 cartons per day.

Thanbee Print World Limited, also established in 2008, has a paid-up capital of Tk45 crore and an annual turnover of around Tk200 crore. The company provides garment printing services with a daily printing capacity of approximately 250,000 pieces.

About DBL Group

Founded in 1991, DBL Group has grown into one of Bangladesh's largest diversified conglomerates. Its businesses span apparel, textiles, textile printing, washing, garment accessories, packaging, ceramic tiles, pharmaceuticals, dredging, retail and digital transformation services.

The group already has one listed company, Matin Spinning Mills PLC, on the Dhaka Stock Exchange.

If implemented as planned, DBL Group's listing strategy is expected to increase the presence of large industrial groups in Bangladesh's capital market, expand the pool of quality listed companies and promote stronger corporate governance and transparency, while creating new investment opportunities for investors.