London's domestically focussed FTSE index slipped to a one-week low on Monday, bogged down by political uncertainty after Prime Minister Keir Starmer said he will resign, reports Reuters.

The internationally focussed FTSE 100 index slipped 0.1 per cent by 0930 GMT, while the midcap FTSE 250 dropped 0.7 per cent.Greater Manchester mayor Andy Burnham, who recently won parliamentary elections, stands as the top candidate for prime minister, although investors say a change in leadership is unlikely to change conditions a lot."Britain's been going in the wrong direction and I don't really think, unfortunately, that any replacement for Keir Starmer, is going to be much different," said David Morrison, senior market Analyst at Trade Nation.

Rate-sensitive household goods and home-construction stocks fell over 1 per cent and were among top sectoral decliners while the pound eased 0.1 per cent versus the dollar.Former health minister Wes Streeting is also in the leadership race, but one senior figure in the party said they believed Streeting could do a deal with Burnham, giving him a senior role if he stayed out of the contest.
"I rather think that Rachel Reeves will probably be gone fairly soon. If we find out that Wes Streeting isn't going to stand and gives Burnham his full support, then he might get rewarded with something like Chancellor of the Exchequer," Morrison said.Reeves was the Chancellor in the government led by Starmer, whose resignation paves the way for Britain to have its seventh leader in a decade.

The next candidate will be scrutinized over fiscal policy plans at a time when concerns over debt-backed public spending has sent the yield on the benchmark 10-year Gilt to its to its highest since 2008.

Citizens have been disappointed over Starmer's handling of the economy as public debt and borrowing costs soared in recent years.

Geopolitical tensions in the Middle East also had investors price in no change to interest rates by the Bank of England this year, according to LSEG-compiled data.

Economic and political uncertainty, alongside geopolitical concerns, have weighed on the domestically focused midcap FTSE index, which underperforms the blue-chip FTSE 100 index this year.

In M&A news, easyJet rose 3.1 per cent and was among top movers on the FTSE 250 index after Castlelake disclosed its £4.74 billion ($6.26 billion) takeover bid for the budget carrier. The airline had rejected three proposals from the US investment firm.
Babcock International lost 5.2 per cent after the defence and engineering group reported a 19 per cent drop in annual underlying operating profit.Globally, there was some relief that negotiations to end the US and Iran conflict were continuing. However, investors awaited clarity that shipping would resume through the Strait of Hormuz.

The government’s proposal to significantly reduce import duties on plug-in hybrid electric vehicles (PHEVs) has raised concerns among local automobile manufacturers, who say the move could encourage imports at the expense of domestic production.

In a letter to National Board of Revenue (NBR) Chairman on June 17, the Bangladesh Automobiles Assemblers and Manufacturers Association (BAAMA) urged the tax authority to revise the proposed fiscal measures, arguing that they create a policy imbalance between imports and local manufacturing.

“The existing budget framework will encourage imports of completely built vehicles rather than the establishment of PHEV manufacturing and assembly operations in Bangladesh,” Hafizur Rahman Khan, president of BAAMA, wrote in the letter.

In its letter, the association called for extending to local PHEV manufacturers the same level of support currently available to EV producers.

Under the proposed budget for fiscal year 2026-27, the total tax incidence on completely built-up (CBU) PHEVs with engine capacities of up to 1,800cc would fall to 73.44 percent from 93.16 percent. For vehicles between 1,801cc and 2,000cc, it would decline to 96.10 percent from 132.66 percent.

However, BAAMA says comparable incentives have not been offered for the local production, assembly and value addition of PHEVs.

The association noted that while the government recently introduced special incentives for locally manufactured electric vehicles (EVs) through SRO No. 163-Ion/2026/18/Customs, issued on June 8, no similar support has been announced for PHEV production.

Industry representatives say this could make importing fully built vehicles more attractive than investing in manufacturing facilities and supply chains in Bangladesh.

The concern comes as hybrid vehicles continue to gain popularity. Data cited by BAAMA from Bangladesh Road Transport Authority (BRTA) registrations show hybrids accounted for 57 percent of passenger vehicle registrations in 2025, up from 42 percent in 2021. Over the same period, the share of conventional internal combustion engine (ICE) vehicles fell from 58 percent to 42 percent.

Despite growing interest in cleaner transport, fully electric vehicles remain a niche segment, accounting for only 0.57 percent of registrations last year. Industry stakeholders attribute the slow uptake to limited charging infrastructure, high battery costs and concerns over long-distance travel.

BAAMA argues that Bangladesh is in a transition phase between conventional fuel-powered vehicles and full electrification, making PHEVs an effective intermediate technology that combines electric driving capability with the flexibility of a conventional engine.

The association said PHEVs can reduce fuel consumption by 40 percent to 60 percent, helping cut fuel import costs while lowering carbon emissions and air pollution.

The debate also has implications for Bangladesh’s emerging automotive industry. Several global brands, including Hyundai, Mitsubishi, Chery and Proton, have invested in local assembly operations through partnerships with Bangladeshi companies. Chinese EV manufacturer BYD has also initiated plans to establish manufacturing operations through a joint venture with Runner Automobiles.

According to BAAMA, policies that favour imports over domestic production could affect future investment decisions and discourage expansion by existing manufacturers.

The association also said the proposed tariff structure departs from the principle of tariff escalation, under which higher duties are imposed on finished vehicles while lower tariffs and incentives support local assembly, component manufacturing and value addition.

Such frameworks are intended to promote industrialisation, employment, technology transfer and the development of domestic supply chains.

BAAMA also referred to the Automobile Industry Development Policy 2021, which commits to supporting local manufacturing through fiscal incentives and investment-friendly measures while promoting fuel-efficient and environmentally friendly vehicle production.

An NBR official, speaking on condition of anonymity, said the proposed duty reduction on plug-in hybrid electric vehicles is part of the government’s broader strategy to promote energy-efficient and environmentally friendly transport

The measure is expected to reduce reliance on fossil fuels and accelerate the adoption of cleaner vehicle technologies.

The official said the government has not overlooked the interests of local manufacturers, noting that a range of fiscal and policy incentives has already been introduced to support the domestic production and assembly of electric vehicles.

Issues related to PHEVs remain under review, and any future policy decisions will seek to balance industrial development, investment promotion, technology transfer, and environmental sustainability.

The fallout from the Iran war has pushed Bangladesh's LNG subsidy burden to Tk16,600 crore, nearly three times the original allocation of Tk6,000 crore for the fiscal 2025-26, as the government was forced to rely heavily on costly spot market purchases.

The additional subsidy requirement arose after long-term LNG deliveries were suspended under force majeure conditions by key suppliers, leaving Petrobangla with little option but to purchase gas from the volatile spot market amid attacks on Middle Eastern energy infrastructure and the closure of the vital shipping lane of Strait of Hormuz.

According to Petrobangla, the conflict has added Tk10,600 crore to the LNG subsidy requirement, a 176.7% increase from the original fiscal provision.
"The Iran war cost us an additional Tk10,600 crore as most long-term suppliers have maintained force majeure since March, forcing us to rely on expensive spot purchases," AKM Mizanur Rahman, director (finance) of Petrobangla, told The Business Standard on Saturday.Of the total subsidy requirement, Petrobangla has already received Tk13,100 crore from the government and expects the remaining Tk3,500 crore in the coming months.

Bangladesh's largest LNG supplier, QatarEnergy, invoked force majeure on 2 March, followed by Oman-based OQ Trading Limited on 5 March and US-based Excelerate Energy on 6 March.

The disruptions also affected some short-term contracts because their loading ports and shipping routes were linked to Qatar and the Strait of Hormuz.

Under the pre-war delivery plan, Bangladesh was scheduled to import 115 LNG cargoes during FY2025-26. Between March and June, 41 cargoes were planned, including only eight from the spot market.

However, after supply disruptions, Petrobangla reduced total imports to 37 cargoes during the period and purchased 25 cargoes from the spot market – more than three times the planned volume – at prices ranging between $20 and $28 per mmbtu.

Mizanur further said Petrobangla had also cut two LNG cargoes from its fiscal import plan to contain subsidy costs. "If those two cargoes had been imported, more than Tk2,000 crore would have been added to the subsidy bill at current prices," he said.

Force majeure continues

Petrobangla officials said long-term LNG supplies are unlikely to resume before 16 July, as suppliers continue to cite force majeure conditions.

"Long-term suppliers have informed us that until the Strait of Hormuz is fully reopened, they cannot resume deliveries," Mizanur said.

Officials said the closure of Hormuz has also disrupted short-term supplies, as most cargoes originate from Middle Eastern loading ports.

With uncertainty continuing, Rupantarita Prakritik Gas Company Limited (RPGCL), Petrobangla's LNG procurement arm, has floated tenders to purchase two additional spot cargoes for July delivery.

"I have no information regarding the resumption of term supplies. RPGCL is now working to secure LNG cargoes for July," said Rafiqul Islam, director (operations) of Petrobangla.

According to the pre-war Annual Delivery Plan for July 2026, Bangladesh was expected to import 10 LNG cargoes to supply 1,010-1,030 million cubic feet of gas per day to the national grid. The plan included four cargoes from QatarEnergy, two from Qatar Energy Trading, one from OQ Trading, one from Excelerate Energy, one under a short-term contract and one spot cargo.

FY2026-27 plan delayed

The uncertainty surrounding the Iran conflict has also stalled Petrobangla's LNG import planning for FY2026-27.

"Once force majeure is withdrawn, we will prepare the import plan for FY2026-27. Until then, there is little value in finalising such plans," Mizanur said.

He added that Petrobangla is currently focused on securing sufficient spot cargoes to maintain gas supplies and remains in regular contact with long-term suppliers.

The government may be losing an estimated Tk4,062 crore in annual revenue due to the existing cigarette pricing mechanism and discrepancies between officially declared retail prices and actual market prices, according to the Power and Participation Research Centre (PPRC).

The estimate was presented at a post-budget press conference on the FY2026-27 budget held at the National Press Club today (22 June).

The briefing, based on an analysis of tobacco taxation policy and market dynamics, said loopholes in the current cigarette pricing and tax structure allow a portion of market transactions to remain outside the government's tax net.

According to PPRC, cigarette taxes in Bangladesh are currently determined based on the government's declared minimum retail price (MRP). In reality, however, most cigarettes are sold as individual sticks, with prices often rounded up to convenient figures.

As a result, retailers are able to charge more per stick than the price implied by the official packet rate. While consumers pay the higher amount, the additional revenue generated is not reflected in the tax base.

Data presented at the conference showed that the official retail price of a 10-stick pack in the low-tier segment is Tk62. However, when sold individually, retailers can charge up to Tk7 per stick. Similar gaps between official and actual retail prices exist in the medium-tier segment.

PPRC said sales of low- and medium-tier cigarettes reached around 61.18 billion sticks in FY2024-25. Given the scale of the market, even a small difference in per-stick pricing translates into a significant amount of untaxed revenue.

According to the organisation, the discrepancy between packet prices and retail prices could cost the government around Tk4,062 crore in revenue.

It stressed that tobacco tax policy should pursue two objectives: reducing smoking and increasing government revenue. However, the current four-tier cigarette pricing structure limits the achievement of both goals.

Because low-priced cigarettes remain relatively affordable, many smokers opt for cheaper brands instead of quitting when prices rise, it said.

To address the issue, PPRC recommended restructuring cigarette price tiers, narrowing the tax gap between low- and medium-tier brands, regulating single-stick sales, implementing a track-and-trace system, and ensuring that actual retail prices are reflected in the tax structure.

Dr Shafiun Nahin Shimul noted that Bangladesh sells around 70 billion cigarette sticks annually, and despite successive price increases, smoking rates have not declined as expected.

He also expressed concern over emerging nicotine products, noting that nicotine pouches have already received regulatory approval. Bangladesh, he said, should avoid repeating mistakes observed in other countries.

Referring to international experience, Dr Shimul said: "The rapid spread of nicotine products among young people in several countries serves as a warning about the risks of regulatory delays. Bangladesh must act proactively to prevent similar outcomes."

Dr SM Abdullah, associate professor of economics at the University of Dhaka, said the latest budget reflected a shift from curative to preventive healthcare. In line with the policy, the government should adopt taxation regime that help reduce tobacco consumption, he argued.

Welcoming the government's track-and-trace initiative, he noted that track-and-trace mechanisms are typically applied to cigarette packs, whereas most cigarette sales in Bangladesh occur through individual sticks. As a result, the effectiveness of the system could be limited unless single-stick sales are addressed.

In his closing remarks, PPRC Chairman Dr Hossain Zillur Rahman said tobacco is linked to public health, the younger generation and government revenue.

"If young people are not health-conscious, we will struggle to achieve our expected outcomes in the creative economy and sports," he said.

While acknowledging recent increases in cigarette prices, he said the hikes were insufficient. He also criticised the government's approach to e-cigarettes, saying that despite stricter regulations introduced during the interim government's tenure, the current government has adopted a softer stance and effectively legitimised nicotine pouches by bringing them under the tax regime.

He urged the government to take stronger measures to regulate the market and curb the use of e-cigarettes and other nicotine products.

The National Board of Revenue (NBR) expects to collect Tk 415,000 crore in revenue in the current financial year, falling Tk 88,000 crore short of its target.

The tax authority collected Tk 360,642 crore during the July-May period of the current fiscal year, registering 10 percent year-on-year growth. Revenue collection in the 11-month period was Tk 81,442 crore short of the NBR’s revised target for the period, according to preliminary NBR data. NBR field offices logged Tk 29,311 crore in revenue in the first 20 days of June. With this, total tax receipts stood at Tk 389,953 crore in the current fiscal year.

In the remaining 10 days of the fiscal year, a further Tk 25,000 crore is expected to be collected, taking the total to above Tk 400,000 crore, the highest ever in the history of the NBR, the state’s largest tax collector.

The revenue authority expects to collect Tk 43,157 crore more in revenue this year than the actual collection of Tk 368,395 crore in the previous fiscal year.

The tax administration said it has formed three task forces comprising field-level officials from the income tax, VAT and customs wings to accelerate revenue collection.

The task forces have already taken various initiatives to increase tax collection, including the speedy disposal of cases relating to revenue disputes in courts, it added.

The NBR has also taken steps to detect tax evasion and collect evaded taxes, quickly dispose of tax files selected automatically for audit, and monitor the collection of income tax and VAT at source.

The revenue authority has also strengthened post-clearance audit and risk management activities at customs houses, while simultaneously completing income tax and VAT audits of high-risk taxpayers.

Towfiqul Islam Khan, additional director, Research, at the Centre for Policy Dialogue (CPD), said the shortfall from the revised revenue collection target of Tk 588,000 crore, including the NBR’s target, is likely to be Tk 100,000 crore this year.

For fiscal year 2026-27, the government aims to collect Tk 695,000 crore, including the NBR’s target of Tk 604,000 crore. The amount is 18.2 percent higher than the current fiscal year’s revised revenue target for the NBR.

If the NBR’s projection of Tk 415,000 crore is taken into account, the tax authority will have to collect 45 percent more revenue next fiscal year.

Khan said that, given the current trend in revenue collection, there is a risk of a Tk 100,000 crore shortfall next year as well.

“There has to be extraordinary performance in revenue collection to achieve the target. For this, the NBR has to curb tax evasion and improve institutional capacity,” he said. “There is no alternative to reforms to do this. Revenue mobilisation will be a defining factor in the implementation of the budget for the next fiscal year.”

Until May, income tax collection recorded the highest year-on-year growth, followed by VAT and supplementary duty (SD) from domestic economic activities and import tariffs collected by customs.

The NBR logged Tk 121,072 crore from direct, or income, tax in July-May of fiscal year 2025-26, up 12.5 percent year on year.

Collection of VAT and SD from domestic sources, the largest source of revenue, grew 10 percent year on year to Tk 140,168 crore.

Collection of import and other tariffs from international trade grew 7 percent year on year to Tk 99,402 crore.

Around 95 percent of farmers in Bangladesh use unbalanced combinations of nitrogen, phosphorus, potassium and sulphur, raising concerns over soil health, crop productivity and the long-term sustainability of agriculture, according to a recent World Bank report.

Only 5 percent of farmers apply nutrients in balanced proportions, according to the report, “Repurposing Agricultural Public Spending for Quality Growth and Jobs in Bangladesh’s Agrifood System”, launched on June 15.

The study found that about two-thirds of farmers overuse phosphorus, nearly nine in ten apply too little sulphur, and six in ten fall short on potassium.

Nitrogen use is also uneven, with underapplication among rice growers and excessive use in onion and vegetable cultivation.

Nutrient imbalances vary significantly across regions. Underdosing is more common in Barishal and Sylhet, while excessive application is more prevalent in Khulna and Rajshahi.

Correcting these imbalances could increase yields by 33 percent for Boro rice, 65 percent for Aman rice and 87 percent for potatoes, the report said.

BRIDGING THE KNOWLEDGE GAP

Jonaed Shohol, a research analyst at the World Bank, told The Daily Star that the low adoption of balanced nutrient practices stems largely from farmers’ limited awareness of scientifically developed recommendations.

Although the Bangladesh Agricultural Research Council (BARC) has established guidelines, these are not being effectively communicated to growers. As a result, many continue to rely on traditional methods rather than scientific advice.

Shohol identified weaknesses in the Department of Agricultural Extension (DAE) as a key factor behind the information gap. According to him, the agency is responsible for equipping farmers with the knowledge needed to adopt recommended practices, but current efforts remain inadequate.

THREAT TO SOIL AND YIELDS

Beyond reducing crop yields, improper application is accelerating soil degradation, Shohol warned.

He said soils are becoming more acidic and less capable of retaining water, trends that could undermine fertility and future agricultural production.

Agriculture Minister Mohammed Amin Ur Rashid told The Daily Star that the average soil pH in Bangladesh is around 4.5, whereas a level above 6.5 is needed to improve soil quality.

Excessive use of chemical inputs has increased acidity and reduced fertility, he said, adding that the government is conducting extensive soil testing nationwide to assess conditions.

At a recent event, Md Abdur Rahim, director general of the DAE, said continuous cropping has depleted soil organic matter, with some land now producing up to four crops a year.

Organic matter, which should ideally account for around 5 percent of soil composition, averages just 0.5 percent to 1.7 percent in Bangladesh, he added.

“To achieve optimum yield capacity, at least 2 percent organic matter is required. Because of this deficiency, expected crop yields are not being achieved,” Rahim said.

“If we cannot increase organic matter content in the future, sustainable agriculture will not be possible.”

RETHINKING RECOMMENDATIONS

The World Bank report said farmers could raise output by about 25 percent through more efficient use of existing land, labour and agricultural inputs.

To improve awareness, Shohol suggested greater use of social media, television and radio programmes, as well as billboards carrying area-specific recommendations.

Moin Us Salam, a former professor in the Department of Agronomy at Bangladesh Agricultural University, said the widely held belief that farmers use excessive inputs warrants closer examination.

He explained that recommendations are generally developed by BARC through research station trials and consultations. However, their effectiveness depends on how well the underlying data represent conditions in specific fields or upazilas.

Referring to Bihar in India, Salam said soil nutrient mapping is being carried out at the level of individual plots, with about half the work already completed.

Such an approach allows for plot-specific recommendations, whereas Bangladesh does not yet tailor guidance to individual plots, he said.

The agriculture minister said limited awareness among field-level government officials regarding soil health has also contributed to the widespread use of unbalanced nutrient mixes.

He added that under the government’s proposed policy approach, input use could be reduced by more than 23 percent while yields increase, lowering production costs and improving productivity.

Beximco Pharmaceuticals has moved a step closer to resolving the boardroom standoff that put its London listing at risk, after Bangladesh’s stock regulator gave the company the go-ahead to hold a board meeting and finally sign off on its overdue accounts.

The Bangladesh Securities and Exchange Commission (BSEC) has given consent to the drugmaker convening a board meeting to approve audited financial statements for the year to June 30, 2025.

Clearing that backlog could help the company meet the rules of London’s Alternative Investment Market (AIM) and avoid cancellation of its securities from trading in London.

The latest regulatory decision follows months of uncertainty triggered by a legal dispute over board composition.

After the political changeover in 2024, the BSEC appointed nine independent directors to Beximco Pharma following a directive from the finance ministry. Beximco Pharma challenged the move in court. Its board has not met to approve accounts, or publish results, since.

In a disclosure to the Dhaka Stock Exchange (DSE) yesterday, the pharma company said its board would meet today to consider the delayed accounts.

Mohammad Asad Ullah, company secretary of Beximco Pharma, said, “The previous board will hold the board meeting as the new board remains under the litigation process.”

“This approval was given by the BSEC,” he added.

In its letter granting consent, the BSEC said it gave the go-ahead “for the protection of greater interest of the investors, accords its consent to hold the meeting of the board of directors of Beximco Pharmaceuticals PLC for the purpose of approval and publication of the financial statements of Beximco Pharmaceuticals PLC and its subsidiaries”.

Md Abul Kalam, spokesperson of the BSEC, said the decision was taken to protect both investors and the country’s market reputation

“To save the image of the country and for the interest of investors, the regulator allowed the board meeting,” he said.

Beximco Pharma is currently the only Bangladeshi company listed on AIM. Kalam said the possibility of delisting would have implications for the credibility of Bangladesh’s capital market.

The governance dispute has had consequences for shareholders, too. Since the legal dispute began, Beximco Pharma has not published quarterly results or annual financial statements.

The absence of audited accounts led to the suspension of trading in its global depositary receipts on AIM on January 2.

Under London Stock Exchange rules, a company must publish audited annual accounts within six months of its financial year ends. If trading remains suspended for six months, admission can be cancelled unless issues are resolved.

As the deadline approached, concerns grew among investors that the suspension could result in delisting.

Shares in Beximco Pharma fell 1.58 percent to Tk 143 on the Dhaka Stock Exchange yesterday, having risen earlier in the week on hopes of a breakthrough.

Speaking on condition of anonymity, a top official of a brokerage house said the regulator’s involvement has been read by investors as a signal that the matter is finally being taken seriously.

The SME stock index soared more than 43 per cent in the six months through June 22 this year, driven largely by abnormal gains in most stocks despite weak corporate earnings and the absence of significant business developments.

Data shows that 17 out of the 20 listed SME stocks registered gains ranging from a modest 0.5 per cent to as much as 153 per cent during the period. As a result, the market capitalisation of the SME board climbed more than 38 per cent to Tk 24.16 billion.
Many of the SME stocks experienced unusual upward movements despite reporting lower earnings, stagnant business growth and no major corporate disclosures that could drive such substantial price surges.The SME sector's financial performance remained under pressure in FY25 as economic activity slowed following the political transition in August 2024. Most SME companies reported year-on-year profit declines for the fiscal year amid weak demand, higher operating costs and cautious business sentiment.

Against this backdrop, investors chased SME stocks, raising concerns that the rallies were driven by speculative trading and market manipulation.

Prices of four SME stocks - Al Madina Pharma, Apex Weaving, Master Feed and Web Coats - more than doubled on the platform during the period.
Al Madina Pharma's stock jumped 153 per cent to Tk 71.3 per share since December last year, despite the company reporting a 33 per cent decline in profit year-on-year to Tk 11.8 million in FY25.Following the abnormal price surge, the Bangladesh Securities and Exchange Commission (BSEC) asked the Dhaka Stock Exchange (DSE) to investigate the trading activities surrounding the stock.Bangladesh economic outlook

The probe will examine whether there was any coordinated market manipulation, abnormal trading activity among investors, or insider trading involving undisclosed price-sensitive information.

Apex Weaving and Finishing Mills also saw its stock price double from the level of December 30 by June 22, even though production at the company has remained suspended for a prolonged period due to gas and electricity disconnections and unpaid utility bills.

Web Coats, a manufacturer of premium paper and board products, posted a 151 per cent rise in its stock price to Tk 28.9 by Monday, although its profit fell 29 per cent year-on-year to Tk 38.4 million in FY25.

"The limited free-float shares and relatively low liquidity of SME companies make them vulnerable to speculative trading," said Md Sajedul Islam, a director of the DSE.

When the broader market shows a rising trend, some investors tend to flock to speculative stocks in pursuit of quick gains, causing prices to surge without any fundamental reason, he said.

Mr Islam advised investors to remain cautious and focus on companies with strong earnings prospects, sound corporate governance and sustainable business models instead of chasing momentum-driven rallies.
Akramul Alam, head of research at Royal Capital, said many investors were increasingly betting on small-cap companies to make quick profits as the broader market maintained an upward trajectory over the past several months.The benchmark DSEX of the prime bourse gained nearly 14 per cent, or 689 points, during the six months through Monday, supported by expectations of stronger regulatory reforms to deepen the capital market under the newly elected government.

However, Mr Alam warned that SME companies generally carry higher business and liquidity risks than large-cap firms."Investors should carefully examine financial statements, governance practices and business fundamentals before making investment decisions," he said.

Meanwhile, two SME stocks that previously played a major role in driving the SME index higher - Himadri and Yusuf Flour Mills - experienced significant corrections during the period.

Himadri's stock price fell 27 per cent to Tk 480 per share between December 30 last year and June 22 this year, while Yusuf Flour Mills dropped 26 per cent to Tk 1,622 during the period.

The Financial Express previously published a series of reports highlighting abnormal price movements in several SME and small-cap stocks, particularly Himadri and Yusuf Flour Mills.

Little-known SME stock Himadri exhibited abnormal price increases, reaching Tk 10,000 per share in November 2023 despite a lack of supporting fundamentals.
In November 2024, the securities regulator fined one individual and three firms a total of Tk 17 million for manipulating Himadri's stock price.Yusuf Flour Mills peaked at Tk 6,352 in June 2024 without any apparent reason for investors to bet on the stock, leaving market experts in awe, as shares of many well-performing firms offering handsome profits and dividends were nowhere near that level.

Even after the corrections, Himadri and Yusuf Flour Mills remain significantly overvalued, with price-to-earnings (P/E) ratios of 126 and 114 respectively as of Monday.

Bangladesh Investment Development Authority currently has around $400 million in potential investments from Chinese companies in its investment pipeline, according to Bida.

This figure may increase further following Prime Minister Tarique Rahman's visit to China from 23 to 26 June, they hope.

Preparations have been taken for a major investment conference in Beijing during the visit, where Bangladesh will showcase new investment opportunities to prospective Chinese investors.

Several bilateral meetings between the prime minister and leading Chinese companies are expected to be held, officials said.

The investment authority has identified key sectors attracting the strongest interest from Chinese investors, including electronics, semiconductors, electric vehicle batteries, advanced and technical textiles, logistics, medical devices and IT-enabled services.

The agency plans to highlight Bangladesh's competitive advantages in these sectors, including its workforce, market access and export potential.

"Chinese investment could become one of Bangladesh's largest sources of foreign investment in the coming years," Nahian Rahman Rochi, executive member and head of business development at Bida, told TBS.

"Chinese companies currently account for approximately $400 million in potential investments in the investment pipeline of the Bida," he said.

"Investment prospects are expanding around existing initiatives, particularly the Chinese Economic Zone. This will create mutual benefits for both countries and strengthen Bangladesh's position as a manufacturing partner," Nahian said.

According to Bida officials, nearly 70 companies from 20 countries, including China, are currently included in its investment pipeline. Established in 2025, the pipeline contains potential investment proposals worth approximately $1.5 billion, they said.

The agency aims to add another $1.5 billion in investment proposals during 2026, raising the total pipeline value to $3 billion by the end of the year.

Nahian said they expect at least 25% of the investment proposals in the pipeline to reach implementation.

"To achieve this, we have strengthened regular follow-ups, direct engagement with investors and coordination through country-specific officers responsible for facilitating investments," he said.

He added that Buda is using a data-driven sector mapping and scoring system to identify industries with the highest investment potential and determine which sectors are most attractive to Chinese investors.

Proposal for second Chinese economic zone

Work is progressing on the government-to-government Chinese Economic and Industrial Zone in Anwara, Chattogram.

Beyond it, China has also proposed establishing a second specialised economic zone in Mongla.

Speaking at an event in Dhaka on 18 June, Bida and Beza Executive Chairman Ashik Chowdhury said ensuring progress on the Chinese economic zone would be one of the key investment agendas during the prime minister's visit.

"We expect to see meaningful progress that could pave the way for the commencement of on-the-ground work at the Chinese Economic Zone," he said.

Ashik said China has shown interest in setting up a second economic zone in Mongla and that important decisions on the proposal could emerge during the visit. Progress may also be made regarding the establishment of a Bdia representative office in China.

He noted that China has remained one of Bangladesh's leading sources of foreign investment over the past five years, prompting the government to advance several investment initiatives around the visit.

According to the latest data from the Bangladesh Bank, net foreign direct investment inflows into the country rose 39.36% year-on-year to $1.77 billion in 2025, up from $1.27 billion in 2024.

China ranked as the second-largest source of net FDI after the Netherlands during the period.

Bangladesh's lubricant sector is pushing back against a proposed budget measure that would replace fixed customs values for synthetic and semi-synthetic lubricants with a floating formula based on Independent Commodity Intelligence Services (ICIS) price assessments.

Industry stakeholders argue that because no internationally recognised ICIS benchmark exists for finished lubricants, the proposal risks creating valuation disputes, revenue leakage and market distortions rather than strengthening tax compliance.

In the proposed FY2026-27 budget, the National Board of Revenue (NBR) suggested replacing the existing fixed minimum customs values for imported synthetic and semi-synthetic lubricants with a floating valuation formula based on international price assessments published by ICIS, plus a minimum 30% markup.

Currently, Bangladesh applies minimum customs values of $3,200 per tonne for semi-synthetic lubricating oil and $5,000 per tonne for synthetic lubricating oil. The budget proposal would replace those separate benchmarks with a common ICIS-based assessment method.

However, industry stakeholders argue that the proposed mechanism may fail to achieve its intended goal of revenue protection because ICIS does not provide any internationally recognised benchmark price for finished synthetic or semi-synthetic lubricant as standalone products.

They fear that instead of strengthening customs valuation, the new method could create valuation disputes, encourage misdeclaration and allow lower-quality products to enter the market.

According to the Bangladesh Lube Blenders Association, Bangladesh's lubricant market is currently worth around Tk8,000 crores, with annual demand estimated at 1,60,000-1,70,000 tonnes. More than half of the domestic demand is now met by local blending companies.

The market has expanded rapidly due to rising demand from transport, industrial manufacturing, power generation, agriculture and construction sectors.

Major international brands including Mobil, BP, TotalEnergies, Castrol and Petronas operate in Bangladesh, while state-owned Jamuna Oil, Padma Oil and Meghna Petroleum are involved in blending and distribution. Local companies such as Lub-ref Bangladesh have also established a significant presence in the market.

Why the industry objects

In a recommendation submitted to the NBR, industry stakeholders said ICIS publishes prices for different categories of base oils but does not provide a standard international reference price for finished synthetic or semi-synthetic lubricants.

They said finished lubricants are not simply base oils; rather, they are highly engineered products produced through combinations of different base oils, additive technologies and proprietary formulations.

As a result, the industry asked which ICIS price would be used as the benchmark and whether it would be based on a particular grade, viscosity level, market or time period.

Azam J Chowdhury, managing director of MJL Bangladesh PLC, said there is no global ICIS standard for synthetic or semi-synthetic lubricants because they are blended products.

"These oils are produced using different combinations of Group I, Group II, Group III, Group IV and Group V base oils. The exact formulation is a patent and commercial secret of the manufacturers. It is not possible for customs authorities to determine the composition and calculate a uniform value," he said.

He added that two products labelled as synthetic lubricants may have completely different formulations and production costs depending on the technology used by manufacturers.

Revenue loss, market distortion risks

Industry stakeholders fear the proposed valuation system could unintentionally reduce government revenue by creating a gap between actual import prices and customs-assessed values. They said high-quality synthetic lubricants are currently traded internationally at around $6,000 per metric tonne or higher, while the proposed ICIS-based formula could result in significantly lower assessed values in some cases.

Such a gap, they warned, may encourage under-invoicing and reduce collections from customs duties, VAT, advance tax (AT) and advance income tax (AIT). They also raised concerns that manipulated import values could increase risks of trade-based money laundering.

The industry further argues that finished lubricants cannot be valued solely based on base oil prices. The final price depends on several factors, including advanced additive packages, research and development, international manufacturer approvals, packaging and supply-chain costs. In many premium lubricants, additives account for a substantial portion of production costs and may even exceed the value of base oils.

Stakeholders say applying a uniform 30% markup on base oil-related benchmarks would fail to capture the actual value of finished lubricant products.

They also fear that an unclear valuation mechanism could create unfair competition, allowing businesses that under-declare import values to gain an advantage over compliant companies importing genuine branded products.

According to industry representatives, this could encourage the entry of low-quality lubricants into the market, posing risks for vehicles, industrial machinery, power plants and agricultural equipment. Modern engines, particularly hybrid and high-performance vehicles, require lubricants that meet strict technical specifications, and the use of unsuitable products could increase maintenance costs and reduce equipment efficiency, they added.

An NBR official told The Business Standard that the revenue authority is discussing the issue with both lubricant importers and local blending companies.

"After receiving applications from the industry, we are talking with both groups. We want to formulate a policy that does not harm any industry while ensuring proper revenue collection," the official said.

The official added that changes could be incorporated into the final budget.

Wayez Mahmud, Director (Sales & Marketing) at United Lube Oil Limited, the distributor of Petronas lubricants in Bangladesh, said it is not the right time to introduce an ICIS-based customs valuation system for lubricant imports.

He argued that the NBR should rely on actual import data and declared transaction values rather than a pricing benchmark that does not exist for finished lubricant products.

"About 80% of the lubricant market consists of mineral oils, while synthetic and semi-synthetic oils account for a relatively small share. Synthetic lubricants are produced using different combinations of base oils from various groups, making it impossible to determine a uniform value based on ICIS references," he told The Business Standard.

He suggested that the NBR adopt a data-driven approach based on the average import prices of different importers, supported by exporters' declared values and recent import statistics.

While the proposed national budget contains several positive signals, including business-friendly measures, tax incentives and investment promotion initiatives, experts have questioned whether its ambitious targets can be achieved in the current economic climate.

They said the budget’s success hinges on deep structural reforms in key institutions, particularly the National Board of Revenue (NBR) and the Anti-Corruption Commission (ACC). Without such reforms, implementation of the government’s fiscal agenda could prove difficult.

Economists, journalists and business leaders made the observations at a discussion titled Fiscal Priorities and Economic Justice: A Critical Review of the FY 2026-27 National Budget, organised by the Bengal Institute of Peace and Economic Development in Dhaka yesterday.

“Although the budget contains several encouraging measures for businesses and investors, the overall fiscal targets are highly ambitious. Achieving these goals without fundamental institutional reforms will be difficult,” said AKM Waresul Karim, a dean at North South University.

He said the budget sets aggressive targets for growth, investment and public expenditure, but the governance and institutional reforms needed to achieve them remain largely unaddressed.

In particular, the modernisation and digital transformation of the NBR are essential. Unless millions of taxpayers -- both individuals and businesses -- are brought under an automated tax administration system, the ambitious revenue target may remain unrealistic.

“In our view, unless tax administration is modernised and automation is expanded significantly, the government’s revenue targets may prove difficult to achieve.”

Failure to meet revenue targets could force the government to rely more heavily on domestic and foreign borrowing, increasing debt-servicing costs, weakening the country’s credit rating, creating pressure on private investment and reducing policy flexibility.

If revenue collection falls short, excessive borrowing could create long-term macroeconomic risks, including rising interest burdens and reduced fiscal space, he added.

Another concern lies in the banking sector. Although the government acknowledges political influence and non-performing loans, a clear reform roadmap remains absent. The government’s plan to borrow Tk 112,000 crore from the banking system could further crowd out private-sector investment.

The scale of borrowing may reduce credit availability for private businesses and discourage fresh investment, he added.

Towfiqul Islam Khan, an additional director for research at the CPD, said the government’s success should be judged by long-term implementation and the quality of expenditure rather than short-term budgetary targets.

A major systemic issue, he said, is the persistent reliance on inflated projections and the NBR’s conflicting dual role as policymaker and tax collector.

He stressed that although some revenue measures appear business-friendly, the budget contains unnecessary “fat”.

Kazi Jesin, a broadcast journalist and television talk show host, supported reforms such as cashless banking to curb rampant tax evasion. She criticised traditional metrics, noting that previous governments’ GDP growth failed to prevent widespread financial hardship, looting or poverty.

Urging political factions to stop making immediate calls for the government’s downfall, she argued that restoring investment and building trust require stability and unity.

“To make the budget effective, critics need to offer constructive suggestions rather than just predicting failure.”

Ultimately, true development lies in maximising human capital and technical training, she added.

Zina Tasreen, a senior sub-editor at The Daily Star, said the budget was not drafted with current realities in mind, failing to recognise that Bangladesh’s economy is experiencing stagflation.

“So there isn’t any workable way out of our current economic situation. The budget assumed that we can spend our way out of any problem, as in Western nations. But our reality is different: strained reserves.”

“The moment we go on expansion, our dollar reserves will deplete fast, and what will happen to inflation then? This is an elementary flaw of the budget.”

She said the budget also leaned too heavily towards a welfare-state model, meaning it does not sufficiently encourage capitalism, productivity and success.

“Can a nation move forward with that sort of a mindset? Globally, all successful welfare states are moving away from that, as it’s not sustainable. But, we, a poor and overpopulated nation, are heading that way.”

Fahim Mashroor, CEO of Bdjobs, said the budget measures have the touch of heart but lack the application of brainpower, reflecting good intentions and empathy while falling short in strategic thinking and practical execution.

The government has proposed allocating Tk 200 crore to support research, innovation and development activities in Bangladesh's blue economy.

Of the total amount, Tk 100 crore has been earmarked for a "Blue Economy Research Fund", while the remaining Tk 100 crore will be allocated for the development of the blue economy, according to the budget proposal for the next fiscal year.

The allocation comes as the government seeks to tap marine resources and increase fisheries exports to $1 billion by 2030, up from around $450 million recorded in fiscal year 2024-25.

In his budget speech, Finance Minister Amir Khosru Mahmud Chowdhury said the government has adopted a plan to operate commercial vessels for harvesting tuna and other pelagic fish in deep-sea waters and to expand seaweed cultivation in order to promote marine-based economic activities.

To strengthen marine conservation efforts, Kuakata and Salimpur will be declared new marine protected areas, while a modern fishing port will be established at Matarbari to ensure the sustainable use of marine resources.

The government is also implementing a project to upgrade the Bangladesh Fisheries Development Corporation's fish landing centre in Cox's Bazar to support the optimal utilisation of marine resources.

China urged the Group of Seven to abide by market economy principles and international economic and trade rules and stop undermining the global trade order on Thursday, responding to the bloc’s latest joint statement that calls for reducing reliance on China for critical minerals and rare earths.

Foreign Ministry spokesman Lin Jian made the remarks at a regular press briefing. China’s position on safeguarding the stability and security of critical minerals and the global industrial and supply chains remains unchanged, Lin said. All parties share the responsibility to play a constructive role in this regard, he added.

He noted that China’s efforts to standardize and improve its export control system are consistent with internationally accepted practices and are intended to better safeguard world peace and regional stability and fulfill non-proliferation obligations.

“We urge the G7 to earnestly abide by market economy principles and international economic and trade rules, and stop using the rules of small exclusive circles to disrupt the international economic and trade order,” Lin said.

Shares of Beximco Pharmaceuticals gained 8 percent over the last two trading sessions on the Dhaka Stock Exchange (DSE), closing at Tk 145.3 yesterday, following reports that the company may be delisted from the London Stock Exchange.

Investors and brokers view potential efforts to prevent the delisting as a positive development, believing they could help resolve the issues that have weighed on the company’s shares since the filing of a petition challenging the appointment of independent directors to its board.

Although the drug maker’s business performance remained strong, its stock came under pressure due to the absence of financial disclosures.

The issue dates back to 2024, when the Bangladesh Securities and Exchange Commission (BSEC) appointed nine independent directors to Beximco Pharmaceuticals following a directive from the finance ministry.

The company subsequently filed a petition with the High Court challenging the decision. Since then, the board has not met to approve or discuss financial results, and the company has not published quarterly earnings reports or annual financial statements.

The lack of financial disclosures led to the suspension of trading in the company’s global depositary receipts (GDRs) on the Alternative Investment Market (AIM) of the London Stock Exchange on January 2.

The suspension was imposed after Beximco Pharmaceuticals failed to publish its audited annual report and accounts for the financial year ended June 30, 2025, by the AIM deadline of December 31, 2025, as well as subsequent financial disclosures.

Under Rule 19 of the AIM Rules for Companies, an AIM-listed issuer must publish its audited annual report and accounts within six months of the end of its financial year.

Under Rule 41, if securities remain suspended from trading for a continuous period of six months, the London Stock Exchange will generally cancel their admission to trading unless the underlying issues are resolved.

The Bangladesh Securities and Exchange Commission (BSEC) has urged the Dhaka Stock Exchange (DSE) to strengthen real-time market surveillance and regulatory controls to prevent market manipulation and protect investors' interests.

The call came during a meeting between BSEC officials and the DSE surveillance team at the commission's office today (21 June), where the two sides discussed measures to modernise the capital market surveillance system and improve market oversight, a BSEC press release says.

The meeting was attended by BSEC Acting Chairman Tanwir Habib Rahman, commissioners Nahid Mahtab and Md Nafiz Al Tariq, as well as senior officials from the commission's surveillance department. DSE Managing Director Nuzhat Anwar and Acting Chief Regulatory Officer Mohammad Shafiqul Islam Bhuiyan represented the stock exchange.

According to the release, discussions focused on the development and modernisation of the capital market, enhancing transparency, and preventing irregularities and manipulation to safeguard investors.

The DSE briefed the commission on recent measures it has taken to curb market manipulation. The stock exchange said it has been temporarily halting trading in shares of companies when unusual price movements or trading patterns are detected.

BSEC assured the exchange of its support in building a transparent, accountable and effective capital market.

The commission also advised the DSE to adopt international best practices in market oversight, including real-time surveillance systems and other necessary regulatory measures to deter manipulation.

Recently, the DSE suspended trading in shares of Shyampur Sugar Mills and Sonargaon Textiles following sharp and unusual price increases. Trading in both stocks resumed the following day after the temporary suspension was lifted.

Creating large banks which can operate across Europe is desirable for sustaining the continent’s financial system, the European Central Bank’s chief economist said Friday.

“Having a banking system that is too localised and, in turn, too intertwined with its domestic sovereign, is not a good recipe,” Philip Lane told a conference organised by French investment bank Natixis in Paris.

“From a macro point of view, it’s very important to have the risk sharing that comes from cross-border banking. That can be in terms of equity ownership, it can be in terms of funding, it can be in terms of common technology,” Lane added.

He was speaking as Italy’s second-largest bank, UniCredit, targets a hostile takeover of German rival Commerzbank, having launched a bid in May which expired Tuesday. The Italians’ longer-term aim is to merge Commerzbank with Germany’s HypoVereinsbank, owned by UniCredit.

The Milan-based bank made a bid valued at 35 billion euros ($40.6 billion) not just to take control of a rival in a fellow EU state but to cement its status as a European heavyweight.

Lane said if banks are unable to achieve mergers, they must seek other ways to reduce costs and risks in a period of rising fixed expenditure, amid the growing need for expensive cybersecurity systems.

Lane said he foresaw a relatively small number of giant banks in Europe and noted the arrival of purely digital banking players to the market, disrupting traditional banking models.

Established players must respond to this process by offering competitive products, embracing technological change along the way, he said.

Chinese Ambassador to Bangladesh Yao Wen has said with the tide at full swell and the wind in their sails, Prime Minister Tarique Rahman's official visit to China (23-26 June) holds "historic significance" and it will surely draw a "more magnificent blueprint" for the development of Bangladesh-China relations.

"Under the strategic guidance of the leaders of both countries, China-Bangladesh relations will forge ahead with more solid political mutual trust, more in-depth practical cooperation, and more robust international collaboration," he said ahead of the visit.

At the invitation of Li Qiang, Premier of the State Council of the People's Republic of China, Prime Minister Tarique Rahman is about to embark on an official visit to China and attend The World Economic Forum's 17th Annual Meeting of the New Champions (2026 Summer Davos Forum).
"On the journey of addressing global challenges, China and Bangladesh will always support each other and move forward hand in hand, making new and greater contributions to the stability and development of both countries, to the prosperity and progress of Asia, and to building a community with a shared future for humanity," said the Chinese ambassador.

During Prime Minister Tarique Rahman's visit to China, the leaders of the two countries will have in-depth exchanges of views on international and regional issues of mutual interest, further coordinate positions and build consensus.

China firmly believes that a "stable, prosperous and confident Bangladesh" will play a more active and constructive role in Global South affairs.

"Let us look forward to the full success of the visit and to the long-standing friendship between China and Bangladesh shining with even greater brilliance in the new era," said Ambassador Yao.

Looking ahead, he said, as China-Bangladesh relations stand at a new starting point that builds on past achievements and opens up new prospects, they are full of confidence and expectations.

On the political front, he said high-level exchanges and party-to-party exchanges between the two countries will become more frequent and in-depth, and political mutual trust will continue to reach new heights.

On the economic front, the ambassador said practical cooperation in areas such as the green economy, investment and business development will continue to expand, bringing more tangible benefits to the two peoples.

On the front of people-to-people exchanges, he said cooperation in education, culture, tourism, youth and other fields will become more vibrant and diverse, allowing the flower of China-Bangladesh friendship to bloom ever more brilliantly in the hearts of the two peoples.

At this important moment when Bangladesh and China are ushering in the next golden 50 years of diplomatic relations, he said in an article that prime minister's first visit to China holds historic significance in building on past achievements and charting the way forward.

This visit will surely inject strong impetus into the development of Bangladesh-China relations in the coming period and promote the upgrading of the Comprehensive Strategic Cooperative Partnership in both quality and substance, he said.

More Solid Political Mutual Trust

China maintains that all countries, regardless of size, strength or wealth, are equal members of the international community and have equal rights to participate in international affairs.

China firmly follows the principle of amity, sincerity, mutual benefit and inclusiveness on neighborhood diplomacy, and remains committed to non-interference in other countries' internal affairs and to providing support without any political strings attached.

"This vision has been fully reflected in China-Bangladesh relations," said the ambassador.

On 4 October 1975, Bangladesh and China officially established diplomatic relations, ushering in a new era of friendly exchanges.

In January 1977, Ziaur Rahman paid his first visit to China in his capacity as Chief Martial Law Administrator and Chief of Army Staff of Bangladesh.

China clearly expressed its support for Bangladesh in safeguarding national independence, laying a solid foundation for the development of bilateral relations.

Begum Khaleda Zia visited China nine times, including five visits as prime minister.

"Frequent high-level exchanges between the two sides have provided strong political guidance for the steady development of bilateral relations," said Ambassador Yao.

Over the past half century, regardless of changes in the international landscape, China and Bangladesh have always respected each other, treated each other as equals, and shown mutual understanding and support on issues concerning each other's core interests and major concerns, he said.

The two countries have become a vivid example of friendly cooperation and mutual benefit between developing countries.

"Prime Minister Tarique Rahman's visit to China at the beginning of his tenure fully demonstrates the high importance Bangladesh attaches to developing relations with China, and reflects the profound foundation of political mutual trust between the two countries," said the envoy.

At present, both Bangladesh and China are at critical stages of their respective national development, and both face difficulties and challenges on the way forward.

The year 2026 marks the beginning of China's 15th Five-Year Plan period.

China is advancing Chinese modernization on all fronts and forging ahead toward the strategic goal of building itself into a great modern socialist country in all respects.

Since its establishment, the new Bangladeshi government has taken a series of measures to maintain unity and stability, improve the economy and people's livelihoods, promote investment and employment, and move toward the goal of building a trillion-dollar economy by 2034.

"These efforts demonstrate its resolve to rise to challenges and press ahead with determination," said Ambassador Yao.

It is precisely because of such shared circumstances and shared aspirations that China and Bangladesh need more than ever to learn from each other and move forward together, he said.

During this visit, the leaders of the two countries will have in-depth exchanges on governance experience and share insights on major issues such as development, economic transformation and reform, further strengthen party-to-party exchanges, and promote more frequent high-level interactions and deeper strategic communication.

"It can be expected that, as exchanges on governance experience continue to deepen, political mutual trust between China and Bangladesh will become even stronger, and bilateral relations will continue to make steady and sustained progress," the ambassador said.

More In-depth Practical Cooperation

Economic and trade cooperation has always been the ballast and propeller of China-Bangladesh relations.

From 2010 to 2025, China remained Bangladesh's largest trading partner for 16 consecutive years.

China has also granted zero-tariff treatment to 100 percent of taxable items for Bangladeshi products exported to China and extended this treatment to 2028.

In the field of investment, China has become Bangladesh's second-largest source of investment.

Nearly 700 Chinese enterprises are registered with Bangladesh's investment authorities, covering a wide range of sectors including energy, transportation, textiles and garments, and information and communications, creating hundreds of thousands of jobs for local communities.

"China has become an indispensable and important development partner in Bangladesh's pursuit of development, economic transformation and modernization," said Ambassador Yao.

Prime Minister Tarique Rahman's visit will inject stronger momentum into Bangladesh-China economic and trade cooperation, he said.

The two sides will have in-depth discussions on expanding bilateral trade and optimizing the trade structure, and promote the entry of more high-quality Bangladeshi products into the Chinese market.

They will further deepen investment cooperation, accelerate project implementation, and attract more Chinese enterprises to invest and do business in Bangladesh.

They will also expand practical cooperation in emerging areas such as scientific and technological innovation, information and communications, green development and artificial intelligence.

"It is reasonable to believe that China-Bangladesh economic and trade cooperation will move toward higher quality and greater depth," said the ambassador.

China-Bangladesh friendship has long taken root in the hearts of the two peoples.

China has always acted with a sense of responsibility as a major country and carried out a series of livelihood projects in Bangladesh that benefit thousands of households.

China-contracted power projects in Bangladesh, including coal-fired, solar and wind power projects, have reached a total installed capacity of over one gigawatt, providing a continuous source of power for Bangladesh's livelihood development and people's daily lives.

China has donated advanced medical equipment to Bangladesh, including physiotherapy and rehabilitation equipment, ventilators and mobile surgical vehicles, contributing China's strength to protecting the health of the Bangladeshi people.

In the face of floods, China promptly extended a helping hand and provided Bangladesh with emergency relief supplies such as rubber boats, life jackets and generators.

"These concrete actions have brought the warmth of China-Bangladesh friendship to countless places in need. It can be expected that this visit will take livelihood cooperation between the two countries to a new level and bring the hearts of the two peoples even closer," said the Chinese envoy.

At the same time, personnel exchanges between the two countries are becoming increasingly frequent, and cultural exchanges and mutual learning are deepening.

Standing at a new starting point, this visit will open broader space for people-to-people exchanges between the two countries.

The two sides will promote cooperation in education, health and skills training, and help Bangladesh cultivate more professional talent suited to the needs of modernization.

They will deepen exchanges in media, film and television, and other areas, so that the two peoples can enhance mutual understanding and deepen friendship through more diverse interactions.

"It can be expected that the hearts of the two peoples will draw ever closer, and the future of China-Bangladesh friendship will be even brighter," he said.

More Robust International Coordination

As the world's largest developing country, the envoy said China has always been a natural member of the Global South and has always shared the same breath and destiny with fellow developing countries.

President Xi Jinping has on many occasions emphasized the importance of strengthening solidarity and cooperation among Global South countries and safeguarding their common interests.

He has called for pooling the strength of Global South countries in the spirit of equality, openness, transparency and inclusiveness, and promoting the reform of the global governance system in a more just and equitable direction.

At present, the world is undergoing accelerated changes unseen in a century.

Unilateralism, hegemonism and bullying practices are growing more rampant, and the cause of global peace and development faces severe challenges.

The more difficult the situation becomes, the more countries that uphold justice should stand together to jointly safeguard the legitimate rights and interests of developing countries and maintain world peace and stability.

Bangladesh is the second-largest economy in South Asia and has an important voice on global issues such as climate change, sustainable development and poverty reduction.

Recently, Bangladesh has won the presidency of the 81st session of the United Nations General Assembly.

"China has always deemed Bangladesh as an important partner in the Global South, and stands ready to work closely with Bangladesh in multilateral institutions such as the United Nations and the World Trade Organization to promote reform of the global governance system and jointly safeguard the collective interests of developing countries," said Ambassador Yao.

The government plans to borrow $2.8 billion from the International Islamic Trade Finance Corporation (ITFC) to finance imports of fuel oil, liquefied natural gas (LNG) and fertiliser in fiscal year 2026-27.

To this end, Bangladesh Petroleum Corporation (BPC) stressed that ITFC reduces its financing markup and the deal allows letters of credit (LCs) to be opened through any Bangladeshi bank. The corporation also proposed provisions allowing Bangladesh to import oil and gas from any energy-rich country, including but not limited to member states of the Islamic Development Bank (IsDB), in order to strengthen energy security and meet emergency requirements.

According to officials at the Economic Relations Division (ERD), negotiations on the financing proposal will take place during the Annual Financing Plan Meeting (FY2026-27) scheduled for 21-24 June in Jeddah, Saudi Arabia. The final financing amount is also expected to be determined during the meeting.

The Bangladesh delegation will be led by ERD Secretary Shahriar Kader Siddiky, Energy and Mineral Resources Division Secretary Mohammad Saiful Islam, and Agriculture Secretary Dr Rafiqul I Mohamed.

Proposed financing breakdown

According to ERD sources, a preparatory meeting held on 4 June decided on borrowing of $2.01 billion for fuel oil imports by BPC, $600 million for LNG imports by Petrobangla, and $200 million for fertiliser imports by the Bangladesh Agricultural Development Corporation (BADC).

BPC informed the meeting that its financing requirement for fuel imports in the current fiscal year was $1.65 billion, of which $700 million has already been disbursed. Due to rising global oil prices, the corporation requested a higher financing ceiling for the next fiscal year.

The meeting also decided to conduct a comparative analysis of fuel procured through ITFC financing and fuel purchased directly from the spot market to strengthen Bangladesh's negotiating position.

Petrobangla officials said the company had largely avoided excessive borrowing during FY2025-26 thanks to a relatively stable economy, continued remittance inflows and adjustments to domestic gas prices.

However, the conflict involving Iran has disrupted LNG shipments through the Strait of Hormuz, one of the world's most important energy transit routes.

As a result, Petrobangla plans to utilise the full $600 million financing facility available under existing agreements.

According to its FY2026-27 plan, major long-term suppliers, including QatarEnergy, OQ Trading Limited and Excelerate Gas Marketing Limited Partnership, have declared force majeure until June 2026, increasing Bangladesh's dependence on alternative sources and spot-market purchases.

Petrobangla expects to use financing for at least two LNG cargo purchases in June 2026 and plans extensive utilisation of the remaining balances under its existing financing agreements.

BADC seeks fertiliser financing flexibility

ERD sources said ITFC had planned a $500 million financing package for BADC in FY2025-26, comprising $200 million in confirmed financing and $300 million in contingency support.

A $100 million agreement for fertiliser imports was signed in September 2025. However, due to the ongoing Middle East crisis, ITFC has temporarily suspended the financing and the funds have yet to be disbursed.

BADC said Bangladesh had already agreed to receive up to $500 million in financing support from ITFC for food security purposes. However, the initial $100 million facility was tied exclusively to fertiliser imports from Saudi Arabia and remains unavailable because of regional instability.

ITFC has also requested additional information and documentation to process a further $200 million financing facility.

BADC has proposed that the remaining $200 million be released quickly and made available for fertiliser imports from any country in the world. It also recommended that future financing agreements avoid country-specific restrictions and allow imports from any source, particularly member countries of the Islamic Development Bank.

Participants at the preparatory meeting agreed that these proposals should be presented during the upcoming negotiations with ITFC.

ITFC's role in Bangladesh

ITFC operates as an autonomous member of the Islamic Development Bank Group, headquartered in Jeddah, Saudi Arabia.

The IsDB has been supporting Bangladesh since 1977. It began financing fuel oil imports for BPC in 1997, and since 2008 the support has continued through ITFC.

Between 2008 and FY2025-26, ITFC provided approximately $21.77 billion to support Bangladesh's energy security.

BPC imports Murban crude oil from ADNOC in Abu Dhabi and Arabian Light crude from Saudi Aramco. Janata Bank currently opens import LCs for Murban crude, while ITFC provides financing to settle payments. ITFC has also been directly financing Arabian Light crude imports after Agrani Bank stopped opening LCs due to the dollar shortage.

For LNG imports, ITFC signed a $100 million facility in 2024 and a $300 million facility in 2025, both extended until 2027 at a financing cost of SOFR plus 1.75%. Although a total LNG financing ceiling of $600 million has been approved for Petrobangla, it has not yet been fully utilised.

ITFC also provided $100 million to BADC in FY2025-26 for fertiliser imports at a rate of six-month USD SOFR plus 1.75%, along with a 0.20% administrative fee.

Push for higher financing ceiling

ERD officials said an ITFC delegation visiting Bangladesh in May 2026 expressed interest in continuing support for the country's growing energy needs and expanding financing into agriculture.

The ERD emphasised that food and agricultural security are now as important as energy security and formally requested that ITFC increase its overall financing ceiling to $3.5 billion for FY2026-27.

The proposal reflects rising global commodity prices, growing import demand and the need to safeguard Bangladesh's supply chains.

ITFC acknowledged the request and said any increase in financing would depend on Bangladesh's formal proposals and financing requirements.

An inter-ministerial preparatory meeting will finalise Bangladesh's position before the Jeddah negotiations.

Around Tk3,000 crore worth of closed-end mutual funds under the trusteeship of the Investment Corporation of Bangladesh (ICB) are set to face conversion into open-end funds or liquidation under newly introduced mutual fund rules.

Of the 20 mutual funds under ICB's trusteeship, 18, including eight managed by ICB Asset Management Company, have fallen within the scope of the new regulations. This is even though the funds' original maturity periods run from 2027 to as late as 2033.

Under the rules, any closed-end mutual fund whose average trading price remains at a discount of 25% or more to its cost-based Net Asset Value (NAV) over six months must be converted into an open-end fund or liquidated.

The trustee must convene an extraordinary general meeting (EGM), seek unit holder approval, and obtain subsequent clearance from the Bangladesh Securities and Exchange Commission (BSEC). A decision requires at least 75% support from votes cast.

Data show that the discount between market prices and cost-based NAVs for the 18 affected funds ranges from 30% to 76% – well above the 25% threshold – making conversion or liquidation mandatory, subject to unit holder voting.

BSEC Executive Director and spokesperson Abul Kalam told The Business Standard that trustees would arrange unit holder meetings and implement whichever decision clears the 75% threshold.

The process became entangled in legal complications after investors filed writ petitions challenging the rules, prompting the High Court to issue a status quo order. On 9 June, BSEC directed trustees to proceed with conversion or liquidation.

Two days later, it issued a follow-up letter instructing trustees to continue while excluding the interests of petitioning unit holders – a move that alarmed market participants who feared compliance could be construed as a violation of the court order. ICB consequently sought clarification from the regulator and withheld action.

The impasse ended on 17 June when the Appellate Division's Chamber Court stayed the High Court order, clearing the path for the process to resume. Lawyers said trustees may now move forward, though an ICB trustee official said the organisation had yet to receive fresh instructions.

"We heard about the stay order, but have not received any instruction from the commission. We have already written to them seeking guidance," the official said.

Stakeholders continue to object to certain provisions, particularly Section 62, of the new rules. A senior asset management official, speaking anonymously, noted the rules were framed under the previous commission and called on the new commission to engage asset managers and trustees on their concerns.

Bangladesh RACE Asset Management, which has also filed a writ petition, is scheduled for a hearing on 22 June.

ICB Asset Management Company operates nine mutual funds, eight of which are caught by the new rules, with discounts to cost-based NAV ranging from 47% to 67%. All six funds managed by Bangladesh RACE Asset Management PCL also exceed the threshold and face conversion or liquidation.

Across the broader mutual fund industry, total approved fund size stands at Tk13,090 crore – 35 closed-end funds accounting for Tk4,431 crore and 105 open-end funds for Tk8,659.5 crore.

Bangladesh's cashew processing industry leaders have expressed concern over proposed tariff changes in the FY2026-27 budget, warning that the new structure could make imported finished cashews cheaper than locally processed products and threaten the viability of domestic processors.

Industry leaders say the proposed measures create an inverted duty structure by increasing the tax burden on imported raw cashew nuts while allowing finished cashew imports from India to continue benefiting from tariff preferences under the South Asian Free Trade Area (Safta) agreement.

They argue that the policy could put around 20 processing factories at risk and discourage planned investments worth hundreds of crores of taka.

The issue involves two categories of products – raw cashew nuts in shell, which are used by local processors, and shelled cashew kernels, the finished product sold in the market.

Industry insiders say five kilograms of raw cashew nuts are required to produce one kilogram of finished kernels.

Under the proposed budget, imports of raw cashew nuts in shell would be subject to 15% customs duty and 15% VAT, raising the total tax incidence from 13.58% to 40.38%.

At the same time, imported shelled cashews, particularly from India, would continue to receive preferential treatment under Safta reducing the impact of higher customs duties.

According to industry calculations submitted to the National Board of Revenue (NBR), the proposed structure would raise the cost of producing one kilogram of locally processed cashew kernels to about Tk1,725.

In comparison, imported finished cashews from India would cost around Tk1,282 per kilogram, creating a price difference of nearly Tk471.

Processors say such a gap would make local production commercially unsustainable.

"If this structure remains unchanged, factories will be forced to shut down as importers will be able to sell finished products at prices far below our production costs," said Robiul Islam Azad, managing director of Green Harvest Fresh Produce Ltd.

He said Bangladesh imports most of its raw cashew nuts from African countries because local production is insufficient.

"Bangladesh imports raw cashew mainly from African countries because domestic production is insufficient. These countries are outside Safta so we have to pay the full customs duty. Importers of finished cashews from India, however, benefit from preferential tariffs," he said.

NBR officials have defended the proposed measures, saying local farmers need protection from cheaper imports and should receive better prices for domestically grown cashews.

However, processors argue that domestic production remains too low to support such a policy.

Industry estimates show Bangladesh produces about 2,000 tonnes of in-shell cashew nuts annually, while demand exceeds 15,000 tonnes.

The country consumes around 3,000 tonnes of shelled cashews each year, of which local processors produce about 800 tonnes and imports account for the remaining 2,200 tonnes.

"Even for existing production, processors need over 4,000 tonnes of raw cashew nuts annually. Local production is only around half that amount. Imports are therefore a necessity, not a choice," BSRM Group Deputy Managing Director Tapan Sengupta said.

Industry seeks supplementary duty

Bangladesh's cashew processing industry emerged about a decade ago, supported by growing cultivation in the Chittagong Hill Tracts and other regions.

However, processors say they have long struggled to compete with imported products.

Entrepreneur Shakil Ahmed Tanvir, who established the country's first commercial cashew processing plant, said the facility ceased operations in 2022 after years of losses.

"Local processors have long faced unfair competition from imported kernels sold at prices below domestic production costs," he said.

Despite those challenges, several large companies have recently invested in the sector.

BSRM launched a processing plant in Chattogram in 2023 and announced plans to invest Tk157 crore in a larger facility at the Mirsarai Economic Zone.

Kazi Farms has also announced plans to invest Tk181 crore in a similar project.

Industry representatives warn that these investments could be delayed or reconsidered if the proposed tariff structure is finalised without changes.

They argue that increasing customs duties alone does not provide effective protection because imports from India continue to receive concessions under Safta, while raw cashew imports from countries such as Tanzania, Benin, the Ivory Coast and Ghana remain subject to the full duty burden.

To address the issue, processors have proposed imposing a 20% supplementary duty on imported shelled cashews instead of increasing customs duty.

They say a supplementary duty would apply equally to all imports and would not be offset by Safta preferences.

"Raising customs duty alone will not solve the problem because Safta reduces its impact. A supplementary duty would ensure fair competition and prevent cheaper imported kernels from dominating the market," said Mohammad Azad Iqbal Pathan, president of the proposed Bangladesh Association for Cashew Processors.

Industry leaders argue that conventional tariff comparisons fail to account for the economics of cashew processing. According to Robiul Islam Azad, the global average kernel outturn ratio is only 22%, meaning processors recover just 20-24 kilograms of edible kernels from every 100 kilograms of raw cashew nuts. "Because more than four kilograms of raw cashew nuts are required to produce one kilogram of kernels, the tariff on imported finished cashews should be at least 4.5 times higher than the duty on raw materials. Otherwise, local processors cannot compete with imported kernels," he said.