The spread between banks’ weighted average lending and deposit rates remained unchanged at 5.70 per cent in June 2026 from the previous month, according to the Bangladesh Bank data released on Tuesday.

The all-bank weighted average deposit rate stood at 6.16 per cent in June, while the lending rate was 11.86 per cent.

The central bank, seeking to keep borrowing costs at reasonable levels across the economy, particularly for productive sectors, instructed banks to cap the spread between weighted average lending and deposit rates at 4.0 percentage points, excluding credit cards and consumer loans, effective from June 29.

Bankers, however, said the new ceiling was unlikely to be achieved immediately as many banks were forced to procure funds at relatively high costs.

They also said the cap could discourage banks from expanding lending to small and medium-sized enterprises (SMEs), despite the fact that the central bank and the government were urging to fund SMEs.

SME funding is believed to be risky, where regular monitoring is required with adequate working forces.

"Actually, the regulation is not scientific because some banks procure funds at a higher cost while others can raise funds more cheaply," a senior banker told the FE, requesting anonymity.

"Imposing a uniform spread across lenders could have unintended consequences, particularly for banks that rely on relatively expensive deposits to fund their loan portfolios."

The issue should instead be left to market forces, which would determine appropriate deposit and lending rates, he said.

Well-managed banks could attract deposits at lower costs, while weaker lenders would often have to offer higher rates to mobilise funds, the banker added.

Meanwhile, the spread between the weighted average deposit and lending rates of non-bank financial institutions (NBFIs) stood at 3.61 per cent in June.

The weighted average deposit rate was 10.14 per cent in the NBFIs, compared with a lending rate of 13.75 per cent.

Bangladesh's transition towards renewable and low-carbon energy in the apparel sector must prioritise workers' job security, skills development, social protection, and rights, speakers said at a multi-stakeholder dialogue in Chattogram today (25 August).

They called for a worker-centred policy framework for a just energy transition, saying industrial modernisation and green technologies should not come at the cost of employment.

The dialogue, titled "Improving Policy Arrangements for Just Energy Transition (JET) in Bangladesh's Apparel Sector from a Labour Perspective", was held at Hotel Saint Martin in the port city.
The National Alliance for Just Transition Bangladesh (NAJTB), Bangladesh Labour Foundation (BLF), and Manusher Jonno Foundation (MJF), with support from Oxfam Bangladesh, jointly organised the event.

Speaking at the event, AKM Ashraf Uddin, executive director of BLF and secretary of NAJTB, said workers must remain at the centre of the energy transition, with adequate social protection, reskilling opportunities, and worker-focused planning.

Dr Masud Kamal, professor of sociology at the Chittagong University, said the energy transition was not merely a technological process but also a socio-technical transformation.

He stressed the need for distributive justice so that workers do not bear the costs of decarbonisation alone.

Md Zubaer Alam, programme officer at BLF, called for translating just transition principles into concrete policies through institutional accountability and coordination among government agencies, trade unions, civil society, and regulators.

Jamir Uddin, director of the Department of Environment, Chattogram Region, said environmental compliance and renewable energy adoption must go hand in hand with worker reskilling and social protection.

Mohammad Mahabubul Hasan, deputy inspector general of the Department of Inspection for Factories and Establishments, Chattogram, stressed regular social dialogue, regulatory oversight and worker safety during industrial and technological transitions.

During a panel discussion, Md Hafij Ahmed Mozumder, director of the Divisional Labour Office, Chattogram, said vulnerable workers needed to be retrained and reskilled to prevent structural unemployment.

Kazi Md Shafiqul Islam Titu, chairman of the Standing Committee on Religious Affairs at Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said workforce development must progress alongside green infrastructure.

Sheikh Abdul Mannan, president of both the Chattogram Chapter of IndustriAll Bangladesh Council (IBC) and the Bangladesh Garment Textile Leather Workers Federation (BGTLWF), warned that modernisation should not become an excuse for job cuts and called for training workers in green technologies.

Md Ali Shahin, head of Advocacy at Young Power in Social Action (YPSA), called for local vulnerability mapping and a dedicated Just Transition Fund for marginalised workers.

Rezoanul Haque Azom, senior officer at Bangladesh Institute of Labour Studies (BILS) and joint secretary of NAJTB, said a one-size-fits-all approach would not work and called for sector-specific assessments in Chattogram.

Speaking at the discussion, The Business Standard's Senior Correspondent Mizanur Rahman Yousuf said, "We cannot have a green factory infrastructure while keeping workers in the dark. Transition roadmaps must reflect ground realities."

Participants called for tripartite dialogue, meaningful worker participation, reskilling, social protection, employment security, occupational safety, and trade union rights in the transition process.

They also said lessons from the apparel sector should inform just-transition plans for other sectors, including shipbreaking, leather, transport, agriculture, fisheries, and waste management.

The organisers called for a national policy framework integrating climate and energy goals with decent work, social protection, skills development, collective bargaining, and meaningful worker participation.

Bangladesh's net readymade garment (RMG) export earnings rebounded strongly in the fourth quarter of FY26, rising 10.38% quarter-on-quarter, driven by higher knitwear exports.

Bangladesh Bank's latest Quarterly Review of Readymade Garments shows net RMG exports stood at $6.23 billion in April-June, compared with $5.64 billion in January-March. On a year-on-year basis, net earnings rose 20% from $5.17 billion in the same quarter of FY25.

Gross RMG export earnings also increased 9.79% quarter-on-quarter to $10.10 billion in the fourth quarter from $9.20 billion. The figure was 10.78% higher than a year earlier.

Knitwear exports rose 19.21% quarter-on-quarter to $5.50 billion from $4.61 billion, while woven garment exports increased only 0.31% to $4.60 billion from $4.58 billion. The strong performance in knitwear helped the sector recover from a relatively weak third quarter.

Bangladesh's merchandise exports also rebounded sharply in June, rising nearly 26% year-on-year to $4.20 billion. However, the late surge was insufficient to prevent a slight decline in overall export earnings in FY26.

Exporters said sharp June growth partly to a low base. Exports were weaker in June last year because of extended Eid-ul-Adha holidays, while most Eid holidays fell in May this year.

Despite the quarterly recovery, exporters remain concerned about energy and power shortages, which could weigh on apparel shipments in the coming months.

Pressures ahead

Mahmud Hasan Khan Babu, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said besides energy shortages, high interest rates and weaknesses in logistics, Bangladesh will face further challenges because of the free trade agreements between the European Union and India and Vietnam.

"However, if the domestic challenges can be addressed, the country's exports will perform better in the new fiscal year than in the previous one," he added.

Gas shortages have already severely disrupted textile production, industry insiders said, despite recent government assurances of improved supply.

Showkat Aziz Russell, president of the Bangladesh Textile Mills Association (BTMA), said more than 900 of its over 1,800 member mills are shut due to gas supply disruptions.

"Not only textile mills, but also gas-dependent steel, paper, particle board and ceramic industries are facing severe production disruptions due to the prolonged gas crisis," he said.

Higher value addition

The RMG sector imported $3.87 billion worth of raw materials in the fourth quarter, including cotton, synthetic and viscose fibres, yarn, fabrics and garment accessories.

These imports accounted for 38.32% of total RMG export earnings, resulting in a value addition of 61.68%, slightly higher than 61.35% in the previous quarter.

For the full fiscal year, however, the sector's performance remained subdued. Total RMG export earnings reached $38.97 billion in FY26, up only 0.96% from the previous fiscal year.

The sector contributed 7.82% to Bangladesh's nominal GDP during FY26, highlighting its continued importance to the economy and external trade.

The United States, Germany, the United Kingdom, Spain, France, the Netherlands, Italy, Canada and Belgium remained the major destinations for Bangladeshi apparel. They accounted for $7.24 billion, or 71.69% of total RMG export earnings in the fourth quarter.

The government and Bangladesh Bank have introduced several measures to support the sector amid rising production costs and global uncertainty. These include the Pre-shipment Credit Refinancing Scheme, Tk50 billion revolving Green Transformation Fund, Tk100 billion Export Facilitation Pre-finance Fund, and Export Development Fund.

The Bangladesh Bank said the near-term outlook for apparel exports remains moderately positive, supported by potential recovery in demand and improvements in compliance.

Sammilito Islami Bank will allow individual depositors to withdraw their principal amounts from certain deposit accounts as needed from September 1, Bangladesh Bank Governor Md Mostaqur Rahman instructed the bank’s top officials yesterday.

He gave the instruction when Kazi Shairul Hasan, chairman, and Abedur Rahman Sikder, managing director of the bank, met him at the central bank, according to a press release.
He also asked the bank to inform depositors that there will be no haircut on their profits, as confusion over the issue persists despite the finance minister’s announcement in parliament. Depositors are already being refunded under the scheme announced on December 29, 2025, the press release said.

From September 1, depositors can withdraw principal amounts from Al-Wadiyah current accounts, Mudaraba savings accounts, and Mudaraba term deposits as needed, beyond the limits set under existing instructions.

The governor also instructed the bank, which started operations with Tk 35,000 crore in capital as the country’s largest and only state-owned Islamic bank, to resume all normal banking operations as soon as possible.

Deputy Governors Md Habibur Rahman, Md Kabir Ahmed, Md Sarwar Hossain and Md Anisur Rahman were also present at the meeting.

Bangladesh and the Korea International Cooperation Agency (KOICA) yesterday signed a $13 million grant agreement to develop technology experts with a focus on artificial intelligence (AI) in the country.

The Record of Discussion (RoD) and Terms of Reference (TOR) for the project, titled “Fostering Innovative Technology Experts with a Focus on Artificial Intelligence (AI) in Bangladesh”, were signed at a ceremony in Dhaka.
The project will be implemented by the Bangladesh Hi-Tech Park Authority under the Information and Communication Technology (ICT) Division, with KOICA providing the $13 million grant.

To be implemented from 2026 to 2029, the project aims to build a strong foundation of AI knowledge and skills among Bangladeshi technology professionals to meet the growing demand of the rapidly evolving global IT industry.

It will promote innovation by strengthening collaboration between industry and academia and enabling technology professionals to apply advanced technologies to real-world problems, according to a press release issued by the Economic Relations Division (ERD).

The initiative will also encourage the application of AI-based solutions to address local and national challenges, contributing to Bangladesh’s sustainable economic growth.

The project will also enhance the employability and job opportunities of Bangladeshi professionals both at home and abroad, including in the Republic of Korea, through advanced technical training and industry-oriented capacity development.

ERD Secretary Md Shahriar Kader Siddiky and ICT Division Secretary Md Mamunur Rashid Bhuiyan attended the signing ceremony along with senior officials from Bangladesh and KOICA.

Masuma Akter, additional secretary and wing chief for Asia, JEC and F&F at ERD, signed the RoD and TOR on behalf of the Government of Bangladesh, while KOICA Country Director Jihoon Kim signed on behalf of the South Korean agency.

The project is expected to strengthen Bangladesh’s AI ecosystem by developing skilled professionals and fostering stronger links between academia and industry, the release said.

The share of 5G-enabled handsets on Bangladesh’s three major mobile networks rose from 5.74 percent in August 2025 to 8.29 percent in July 2026, showing that consumers are steadily moving towards next-generation smartphones despite limited 5G availability.

Grameenphone, Robi and Banglalink had a combined 14.68 million 5G-capable handsets on their networks in July, up 45.6 percent, or nearly 4.6 million, from 10.08 million in August last year, according to Bangladesh Telecommunication Regulatory Commission (BTRC) data compiled from the operators.
The growth far exceeded the 0.7 percent increase in total handsets, which rose from 175.75 million to 177.02 million over the 11 months. This suggests that most of the growth in 5G devices came from consumers replacing older phones rather than from a significant increase in the overall number of handsets.

However, the figures do not represent unique physical devices. Operators count handsets separately on their networks, meaning the same phone may be counted more than once if it uses SIM cards from different operators. Industry people said many users keep multiple SIMs for better call rates, data offers and network coverage.

Bangladesh’s 5G moment: promise, challenges, and the road ahead
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Bangladesh’s 5G moment: promise, challenges, and the road ahead

Smartphones, including 3G, 4G and 5G devices, accounted for 65.15 percent of handsets in July, up from 62.68 percent in August last year. The share of feature phones fell from 37.32 percent to 34.85 percent.

Globally, 5G adoption is accelerating, with subscriptions reaching 3.1 billion in the first quarter of 2026, according to Ericsson. Bangladesh remains far behind mature 5G markets, but the rising number of compatible devices indicates that consumers are preparing for wider adoption.

Of Bangladesh’s four mobile operators, only Robi and Grameenphone commercially launched 5G on September 1, 2025. Neither has disclosed the number of customers using 5G or the number of sites upgraded for the technology.

ROBI LEADS IN 5G READINESS

Grameenphone had the largest number of 5G-capable handsets, at 6.19 million in July, up 44.3 percent from 4.29 million in August last year.

Tanveer Mohammad, chief corporate affairs officer of Grameenphone, said the operator has launched 5G services across all divisional headquarters, but “the wider 5G ecosystem in Bangladesh -- including device availability, practical use cases and industry readiness -- is still developing.”

He said a stronger and more reliable 4G network would help drive 5G demand. Grameenphone has also started deploying its 700 MHz spectrum to improve network quality, indoor coverage and nationwide reach.

“Looking ahead, we see significant potential for 5G not only in consumer services but also in enterprise and industrial applications,” he said, adding that the company would expand coverage as the ecosystem and demand grow.

Robi, meanwhile, had the highest share of 5G-capable handsets. It had 5.74 million such devices in July, up 46.9 percent from 3.91 million 11 months earlier, the fastest growth among the three operators.

As a result, 10.06 percent of Robi’s handsets were 5G-capable, compared with 7.53 percent at Grameenphone and 7.29 percent at Banglalink.

Shahed Alam, chief corporate and regulatory affairs officer of Robi Axiata, said Robi is carrying the highest volume of 5G traffic in the market as more customers adopt 5G devices.

“We aim to provide 5G coverage wherever there is sufficient demand and a meaningful number of 5G-enabled devices connected to our network. In many locations, we already have blanket 5G coverage, with speeds exceeding 100 Mbps,” he said.

Shahed said Robi’s focus was not simply on expanding coverage but on developing practical uses for 5G beyond social media and video streaming.

“We believe the real value of 5G lies in developing meaningful use cases beyond simply browsing social media or streaming videos,” he said, adding that the technology could create new digital experiences, businesses and services for consumers and the economy.

He also said Robi wants local innovators, developers and entrepreneurs to use 5G to develop solutions for local needs, creating an ecosystem where 5G is “not just a faster network, but a platform for innovation and new possibilities.”
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How does 5G work, and why should we care?
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How does 5G work, and why should we care?

Banglalink had 2.75 million 5G-capable handsets in July, up 46.1 percent from 1.88 million in August last year.

Taimur Rahman, chief corporate and regulatory affairs officer of Banglalink, said the operator would consider launching 5G if spectrum prices are significantly reduced during the renewal process in November.

He said a successful rollout would also require lower spectrum prices, investor-friendly policies and regulations, and greater network sharing.

“Bangladesh cannot sustain some of the world’s highest spectrum prices and telecom taxes while having one of the world’s lowest ARPUs (average revenue per user),” he said.

“As 5G deployment requires significant investment, these issues must be addressed to ensure quality and affordability,” he added.

Banglalink plans to launch 5G initially in areas with high demand and a large concentration of 5G-capable devices. It also plans to explore enterprise solutions based on the technology as part of its initial rollout strategy.

The National Board of Revenue is set to exempt businesses and companies with annual turnover of up to Tk2 crore from minimum turnover tax, easing a tax burden that currently applies regardless of profitability.

Under the proposed structure, businesses and companies with annual turnover of up to Tk2 crore would pay no minimum turnover tax. Those with turnover above Tk2 crore and up to Tk3 crore would pay 0.25%, while those with turnover above Tk3 crore and up to Tk4 crore would pay 0.50%. Businesses and companies with turnover above Tk4 crore would continue to pay 1%.

Businesses and companies with turnover above Tk4 crore would continue to pay the existing 1% minimum turnover tax, according to officials familiar with the proposal.

A senior NBR official, speaking to The Business Standard on condition of anonymity, said the summary of the proposal had already been approved by Finance Minister Amir Khosru Mahmud Chowdhury and sent to the law ministry for vetting.

"We expect the order to be issued by Thursday [tomorrow] or early next week," the official said.

The proposal is aimed at reducing the tax burden on small businesses and companies with relatively low turnover. At present, a 1% minimum turnover tax is imposed on turnover regardless of whether a business makes a profit or incurs a loss.

Business community welcomes relief but seeks broader reform

Md Fazlul Hoque, administrator of the Federation of Bangladesh Chambers of Commerce and Industry, said the proposed changes would reduce the tax burden on small businesses and companies.

He said, however, that tax should ultimately be based on actual income and called for the minimum turnover tax system to be abolished in favour of taxation based on actual profits.

The FBCCI sent a letter to the finance minister on 24 August urging the government to gradually move away from the 1% minimum turnover tax imposed on businesses and companies.

Taskeen Ahmed, president of the Dhaka Chamber of Commerce and Industry, also supports moving away from the existing minimum turnover tax system.

Until the fiscal 2024-25, most companies, with some exceptions, were subject to a minimum turnover tax of 0.60% of annual turnover, while non-company businesses with annual turnover above Tk4 crore were subject to a 0.25% minimum turnover tax.

The 2025 budget raised the minimum turnover tax rate to 1% for both categories, increasing the effective tax burden on businesses with low profit margins and causing loss-making businesses to pay tax despite having no profits.

Minimum turnover tax can raise effective tax burden

Tax experts said the proposed changes would provide some breathing space for small businesses and companies with low turnover, but warned that larger businesses making low profits or operating at a loss would continue to face the same problem.

Snehasish Barua, a chartered accountant and managing partner of SMAC Advisory, said the proposed reduction would provide some relief to small businesses and low-turnover companies.

"However, larger businesses can also incur losses or make low profits," he said. "Without relief for them, the measure will ultimately do little to reduce their effective tax rate."

Currently, non-listed companies are subject to a corporate tax rate of 27.50%, while the maximum income tax rate for individual taxpayers, including owners of non-company businesses, is 30%.

The FBCCI has cited examples to show how the minimum turnover tax can result in an effective tax burden far higher than the tax payable on actual income.

According to its letter to the finance minister, an individual business with annual sales of Tk50 lakh and a 5% profit margin would earn Tk2.5 lakh. As this amount falls within the tax-free income threshold under the existing system, no income tax would otherwise be payable, the FBCCI said. However, the 1% minimum turnover tax would require the business to pay Tk50,000.

Similarly, if annual sales were Tk1 crore and the profit were Tk5 lakh, the tax payable under the regular income tax system would be Tk10,000, while the 1% minimum turnover tax would amount to Tk1 lakh, according to the FBCCI.

Barua said recent Finance Act reforms had changed the fiscal framework, including by separating minimum turnover tax obligations from source deductions, but the statutory minimum turnover tax remained unchanged.

"For enterprises currently running at a loss or suffering operational strain, deferred mechanisms such as future tax adjustments offer no immediate liquidity relief," he said.

Risk of turnover manipulation

The proposed exemption for businesses with turnover of up to Tk2 crore could create an incentive for some businesses to underreport sales to remain below the threshold, according to concerns raised by some stakeholders.

Similar concerns arose in the past when a 1% minimum turnover tax applied to businesses with turnover above Tk4 crore, with some businesses allegedly reporting lower turnover to avoid crossing the threshold.

The NBR official said, however, that businesses that previously underreported turnover to remain below the Tk4 crore threshold generally reported turnover above Tk2 crore, meaning the proposed structure would leave less scope for such manipulation.

The official said the NBR's calculations showed that at least one lakh individuals and companies would remain liable to pay tax under the proposed system.

"According to our calculations, tax collection will not decrease; rather, it will increase," the official said.

The NBR is also integrating its systems with different organisations to improve monitoring of business transactions, the official said, making it more difficult for businesses to underreport turnover.

City Bank PLC has withdrawn its proposal to increase the maximum number of non-independent directors from eight to 10, while retaining its plan to raise authorised capital to Tk3,000 crore.

The decision was taken at a board meeting on Monday after the board reviewed the legal, regulatory, governance, shareholder, contractual and other implications of the proposals approved earlier this month, according to a price-sensitive disclosure filed with the Dhaka bourse today (25 August).

The bank will no longer place the proposal to increase the maximum number of directors, excluding independent directors, from eight to 10 at its upcoming Extraordinary General Meeting (EGM).

The proposal has been withdrawn from the EGM agenda and kept open for consideration at an appropriate time, the bank said.

City Bank had initially approved the board expansion proposal at its 13 August meeting. The bank currently has seven shareholder directors and two independent directors.

Tk3,000cr capital plan retained

The proposal to increase the bank's authorised capital by 50% to Tk3,000 crore from Tk2,000 crore will remain on the EGM agenda.

The increased authorised capital will comprise 300 crore ordinary shares of Tk10 each, compared with the existing 200 crore shares.

The proposal, along with amendments to the relevant provisions of the bank's Memorandum and Articles of Association, remains subject to shareholder, regulatory and statutory approvals.

The EGM will be held online on 4 October at 3pm. The record date has been set for 6 September.

Capital headroom amid dividend rules

The capital expansion comes as banks prepare to comply with Bangladesh Bank's new dividend requirements.

Under a central bank circular issued on 23 May, commercial banks with paid-up capital below Tk2,000 crore will not be allowed to declare cash dividends from 31 December 2026.

City Bank currently has paid-up capital of Tk1,749.40 crore, leaving it Tk250 crore short of the threshold.

By increasing authorised capital, the bank will create additional room to raise paid-up capital through future rights or bonus shares.

For 2025, City Bank declared a 15% cash dividend and a 15% stock dividend.

Earnings remain strong

The capital plan comes amid a strong growth in the bank's profitability. Consolidated profit increased from Tk478 crore in 2022 to Tk1,324 crore in 2025.

In the first half of 2026, the bank posted consolidated profit of Tk527 crore.

City Bank shares closed at Tk30.40 on the Dhaka bourse today, giving the bank a market capitalisation of around Tk5,318 crore.

The Bangladesh Securities and Exchange Commission (BSEC) has approved a seven-year subordinated bond worth Tk400 crore aimed at strengthening the issuer's capital base.

The bond will be issued through private placement to corporate entities, high-net-worth individuals, banks and financial institutions, provident and gratuity funds, and insurance companies.

The approval came at a commission meeting held today (25 August) at BSEC's headquarters in Agargaon, presided over by BSEC Chairman Masud Khan.

According to a press release, the bond is non-convertible, unsecured, fully redeemable, and carries a floating rate. Its coupon rate will be determined based on the reference rate plus a 3% margin, while the face value per unit has been set at Tk50 lakh.

The proceeds raised from the issue will be utilised by Meghna Bank to bolster its Tier-II capital base under the Basel III regulatory framework.

DBH Finance PLC will act as the trustee for the bond, while BRAC EPL Investments Limited will serve as the issue manager.

Meghna Bank, a fourth-generation bank, commenced its operations in 2013. According to its annual report, the bank posted a profit after tax of Tk5.38 crore in 2025, a significant decline from Tk50.45 crore in 2024.

Its consolidated profit and loss account showed net interest income turning negative by Tk124.93 crore, as interest paid against deposits and borrowings increased.

The bank paid Tk955 crore in interest against deposits and borrowings in 2025, up from Tk716 crore in 2024, the report showed. Meanwhile, its interest income on investments surged to Tk830.38 crore, up from Tk685.55 crore in 2024.

Daily turnover on the Dhaka Stock Exchange has plunged 58% in just 15 trading days, falling by Tk704 crore from Tk1,211 crore on 4 August to Tk507 crore today (25 August), as weak fresh fund inflows, investor caution and concerns over the economy weigh on market activity.

Turnover stood at Tk507 crore today, compared with Tk1,211 crore 15 trading sessions earlier. The decline of Tk704 crore represents a 58.13% drop in daily market activity.

Against this backdrop, the DSE benchmark index DSEX fell 3 points to 5,640 today.

The DS30 index declined 5 points to 2,126, while the DSES index fell 3 points to 1,127.

A total of 391 companies and mutual funds traded on the day. Of them, 175 declined, 152 advanced and 64 remained unchanged.

Market insiders said the sharp contraction in turnover reflects a combination of weak liquidity, limited inflow of fresh money, the recent market correction, heightened regulatory scrutiny and growing uncertainty among investors.

They said the market had earlier rallied strongly, with the DSEX rising from around 5,200 points to nearly 5,900 points. The subsequent correction prompted some investors to book profits, while others have adopted a wait-and-see approach amid uncertainty over the market's near-term direction.

As a result, buying pressure has weakened, while investors are becoming increasingly selective about deploying fresh funds.

Fresh money flow remains weak

Market insiders said the most immediate concern for the market is the lack of fresh or net new money.

Much of the current trading activity is being generated by existing investors' funds. With limited new money entering the market, the capacity to absorb selling pressure has weakened significantly.

They said this is particularly important because a market rally requires sustained fresh liquidity. Without new funds, even fundamentally sound stocks can struggle to attract sufficient buying interest.

The sharp fall in turnover over just 15 trading sessions is therefore being viewed as a sign of weakening market liquidity rather than simply a decline in share prices.

Gas and power crisis deepen investor concerns

The nationwide gas and electricity crisis is adding to the pressure on investor sentiment, market insider said.

EBL Securities, in its daily market commentary, said persistent concerns over the market's near-term trajectory amid the gas and electricity crisis continued to weigh on investor sentiment and limit the prospects for a recovery.

The brokerage said the DSE witnessed volatile, see-saw trading throughout the session. Bargain hunters dominated through the middle of the session, but intensified broad-based selling in the final hour wiped out earlier gains, leaving the benchmark index marginally lower.

Market insiders said the energy crisis is also raising concerns over the earnings prospects of production-oriented listed companies.

Many factories are operating below normal capacity because of inadequate gas and electricity supplies. This could affect production, sales and profitability, particularly in sectors such as textiles, ceramics, plastics and other manufacturing industries.

As a result, investors are becoming more cautious about buying shares based on future earnings expectations.

Regulatory scrutiny adds to investor caution

Increased regulatory activity has also contributed to the cautious mood, market insider said.

The DSE is investigating the activities of several listed companies, while the Bangladesh Securities and Exchange Commission (BSEC) has decided to strengthen spot inspections.

Recent administrative actions against officials of the BSEC and DSE have also generated mixed reactions among investors.

Market insiders said stronger regulatory oversight should improve transparency and accountability over the long term. However, in the short term, the heightened scrutiny has encouraged investors to take a more cautious approach.

UCB rights shares

The market could also face additional liquidity pressure from the issuance of United Commercial Bank (UCB) rights shares, market insider said.

The BSEC recently approved the bank's Tk775 crore rights issue. Market insiders said some existing investors may have withdrawn funds from the secondary market to subscribe to the rights shares.

At a time when fresh fund inflows are already weak, raising money for a large rights issue could prompt some investors to sell existing holdings, they said.

This could create additional selling pressure in the secondary market and further constrain liquidity in the short term, they said.

Recovery depends on fresh liquidity

Despite the sharp fall in turnover, market insiders do not necessarily see the current weakness as a long-term trend.

They said investor interest could gradually return to fundamentally strong and relatively undervalued companies once market uncertainty eases and fresh liquidity begins to enter.

A realistic margin loan framework could also encourage greater participation by institutional and active investors, potentially bringing new funds into the market and strengthening buying pressure.

For now, however, the steep decline in turnover from Tk1,211 crore to Tk507 crore in just 15 trading sessions highlights the extent to which liquidity and investor confidence have weakened in the market.

Textile stocks accounted for the largest share of today's turnover at 25.3%, followed by banks at 13.7% and general insurance at 10.1%.

Fuel stocks posted the highest gain, rising 0.6%, followed by paper at 0.4% and cement at 0.3%.

Ceramic stocks recorded the steepest correction, falling 0.8%, followed by jute at 0.6% and life insurance at 0.5%.

The Chattogram Stock Exchange also closed in negative territory. The CSCX index fell 49.9 points, while the CASPI, the all-share price index, declined 93.9 points.

The Trump administration on Sunday warned that Canada would be “foolish” to think it could win a trade war with the United States, predicting a “devastating” impact on its northern neighbor.

Negotiations between Washington and Ottawa broke down late Friday, putting into force new 50-percent US tariffs impacting about $20 billion worth of Canadian goods, or 5.5 percent of Canadian exports to the United States.
Canada in retaliation said it would match US tariffs, with new levies notably targeting the US steel and dairy industries to take effect on September 8.

US Transportation Secretary Sean Duffy said Canada would come out worse from tussling with President Donald Trump in a trade war.

“We’re great trading partners, right? But Canada gets the benefit of trading with the US way more than the US gets the benefit of trading with Canada,” he told the “Fox News Sunday” talk show. “To think that they’re going to go to war with Donald Trump and actually win that war with the US, I think it’s foolish on their part.”

He predicted that Canadian Prime Minister Mark Carney would return to negotiations “very very quickly, because it’s going to be devastating for his country.”

Carney was defiant on Saturday, announcing retaliatory tariffs on the US after walking away from a “bad deal” on trade as the rift between the longtime allies deepened.

“You’re at war when you get attacked. We got attacked,” Carney said.

Trump hit back at Canada early Sunday, saying, “Canada wants the benefits of being a State, without being one!!!”

“They have also charged our great farmers, for many years, massive amounts of Tariffs. No more!!!” Trump added in a post on Truth Social.

President Donald Trump sought to boost pressure on Canada on Monday, warning that US tariffs on all cars, ‌trucks and automotive parts from the US northern neighbor would be increased to 50% starting January 1 after trade talks collapsed over the weekend.

The trade deal on the table would have cut the top-line tariff rate on Canadian cars and light-duty trucks from 25% to 15% and the tariffs on aluminum and steel from ​50% to 25% but the deal collapsed on Friday over a number of points of contention including whether the US ​tariff relief would have applied to medium or heavy-duty trucks.

"Build in the US and there are ZERO TARIFFS. Canada ⁠will be treated like a State no longer!" Trump wrote.

"On Trade, and in other ways, also, they are among the worst Nations ​in the World to deal with. They feel entitled, and yet, WE DON'T NEED CANADA, THEY NEED US!" Trump said.

Canada has consistently ​been one of the top two US trading partners and last year, US goods and services trade with Canada totaled $872.3 billion, down 4.6%.

Canada exported over three-quarters of its goods to the US and imported almost half of its goods from the US

US auto production is heavily integrated with Canada and Mexico and ​the tariffs — depending on the specifics — could have drastic impacts on American production.

Flavio Volpe, the president of Canada's Automotive Parts Manufacturers' Association, ​said, "A threatened US tariff on Canadian auto parts will be paid by (the) US auto assembly. Without those specific parts, auto assembly throughout the US would ‌halt."

The White ⁠House did not immediately respond to a request for comment seeking more details on the threatened tariffs. Representatives for the Canadian government also did not immediately respond to a request for comment.

Canada will impose tariffs on some US goods starting September 8 in retaliation for 50% levies ordered by Trump on $20 billion in Canadian products.

"You're at war when you get attacked. We got attacked," Canadian Prime Minister Mark ​Carney said on Saturday when asked ​whether Canada was engaged in ⁠a trade war.

Many automakers have announced or are considering plans to scale back Canadian auto production and the trade standoff has led to a 22% reduction in Canadian imports of US vehicles.

Major ​automakers did not immediately comment on Trump's announcement.

But auto executives, speaking to Reuters on the condition ​of anonymity, raised skepticism ⁠about Trump's threat, noting that the president has previously announced large tariffs that never materialized and that any tariff of that size would likely spark a massive Canadian retaliation.

They also noted that January was months after November's midterm elections and that Trump's threat could be aimed at ⁠restarting talks.

​In January, Trump said the US would decertify Bombardier Global Express business jets and ​threatened 50% import tariffs on all aircraft made in Canada until the country's regulator certified a number of planes produced by US rival Gulfstream.

Neither occurred but the following ​month Canada certified several Gulfstream planes.

GBB Power Limited has entered the renewable energy sector by signing an agreement to develop a solar power plant, following a 99% surge in its share price over the past few weeks.

According to a disclosure filed with the Dhaka Stock Exchange (DSE) today (24 August), the company's subsidiary, Solaron Power Limited, has signed a 25-year Power Purchase Agreement (PPA) with Cumilla Cantonment.

Under the agreement, Solaron Power will install a 5.005 MWp ground-mounted solar power plant on a Build, Own, Operate and Transfer (BOOT) basis.

GBB Power holds a 70% stake in Solaron Power, while the remaining 30% is owned by strategic partners.

The renewable energy project comes as GBB Power's share price has surged sharply in recent weeks, gaining nearly 99%.

The project, with an estimated investment of Tk6 crore, is expected to begin commercial operations in the first half of 2027.

The announcement comes after a period of extraordinary volatility for the company's stock. DSE data shows the scrip was trading at Tk8.2 on 28 July 28, before skyrocketing 99% to reach Tk16.3 by 18 August. The share price closed at Tk14.20 today.

The move into solar is significant for GBB Power as its two existing power plants are currently non-operational following the expiry of their previous government contracts.

The government is buying two cargoes of Liquefied Natural Gas (LNG) from South Korea and the United Kingdom at record-high prices to meet rising domestic gas demand, with the price exceeding $24 per million British thermal units (MMBtu).

The Cabinet Committee on government purchase, chaired by Finance Minister Amir Khosru Mahmud Chowdhury, today (24 August) approved the proposals to import the two cargoes through the international quotation process.

One of the cargoes will be imported from South Korean trading and energy company Posco International Corporation for delivery on 13-14 September at $24.625 per MMBtu.

The committee also approved the import of another cargo from Total Energies Gas and Power Ltd of the UK for delivery on 23-24 September at $24.25 per MMBtu.

Earlier, at its meeting on 19 August, the purchase committee approved a proposal to buy LNG from Aramco Trading Singapore Pte Ltd at $23.93 per MMBtu.

The latest purchases come as the government steps up LNG imports to meet the country's growing gas demand.

The Ministry of Power, Energy and Mineral Resources placed the proposal before the committee under Rule 105(3)(a) of the Public Procurement Rules 2025 through the Request for Quotation (International) process.

The government is also set to import 115,000 tonnes of fertiliser from Canada, Russia, and Saudi Arabia, aiming to build up stocks amid concerns over the supply of the vital crop nutrient due to the US-Israel war on Iran and China's export ban.

The committee approved the proposal following consideration of the procurement process and the recommended bidders. The latest approval comes as Bangladesh continues to rely heavily on imported LNG to meet its growing demand for natural gas, particularly for power generation and industrial consumption.

Apart from the LNG purchase, the purchase committee also approved proposals to import 365,000 tonnes of urea and non-urea fertiliser amid allegations that fertiliser is being sold to farmers at inflated prices in different parts of the country.

The imports comprise 70,000 tonnes of urea, 60,000 tonnes of triple super phosphate (TSP), 120,000 tonnes of Diammonium Phosphate (DAP) and 115,000 tonnes of Muriate of Potash (MOP).

According to the Finance Ministry, the committee approved the import of 40,000 tonnes of urea from Saudi Arabia-based SABIV Agri-Nutrients Company while 30,000 tonnes from Bangladesh's Karnaphuli Fertilizer Company (KAFCO) Ltd.

The committee also approved the import of 60,000 tonnes of TSP from Morocco's OCP Nutricrops under the government-to-government (G2G) arrangement.

Under the G2G arrangement, the committee approved the purchase of 80,000 tonnes of MOP from the Canadian Commercial Corporation and 35,000 tonnes from Russia's Foreign Economic Corporation.

The committee also approved proposals to import 80,000 tonnes of DAP from Morocco and 40,000 tonnes from Saudi Arabia.

Adverse weather has reduced jute yields this year, while export restrictions have weakened demand and pushed down prices, raising fears of losses among farmers.

Farmers said they expanded jute acreage after receiving good prices last year. However, excessive rainfall forced many to harvest the crop earlier than usual, resulting in lower yields.

Traditionally, lower supply supports higher prices, but farmers and traders said the suspension of raw jute exports to India had reduced demand in the local market.

Prices of good-quality raw jute have fallen by around Tk 1,200 per maund over the past one-and-a-half months. Rising production costs have further squeezed farmers.

FARMERS COUNT LOSSES

According to the Department of Agricultural Extension (DAE), the government has set a target of cultivating jute on 708,282 hectares in the 2026-27 season, with a production target of 85.21 lakh bales.

Data from the Bangladesh Bureau of Statistics (BBS) shows projected jute cultivation in FY2025-26 was 2.31 percent lower than FY2024-25, while production was expected to decline by 1.89 percent year-on-year.

Several farmers in Faridpur, Rajbari and Magura said yields per bigha had declined this season.

Sukontho Pal, a jute farmer from Boalmari upazila of Faridpur, said production costs had increased while yields had declined.

“Good-quality jute is now selling for a maximum of Tk 4,000 per maund, whereas I received around Tk 4,500 last year,” he said.

“Production costs per bigha have increased by Tk 4,000 to Tk 5,000 from last year. At the current market price, we cannot even recover our production costs.”

Md Siam Mallik, a farmer in Baliakandi upazila of Rajbari, blamed excessive rainfall for lower yields.

“Most farmers were forced to harvest jute 15 to 20 days earlier than usual due to excessive rainfall. As a result, yields fell by two to four maunds per bigha,” he said.

Naba Kumar Kundu from Magura Sadar upazila said farmers earned Tk 12,000 to Tk 15,000 per bigha last year when jute prices were high.

“The situation is completely different this year. It is difficult for farmers to make a profit unless jute prices remain above Tk 4,500 per maund,” he said.

“Good-quality jute is now selling for a maximum of Tk 4,000 per maund, whereas I received around Tk 4,500 last year,” said Sukontho Pal, a jute farmer from Faridpur

TRADERS UNDER PRESSURE

Md Mahmudur Nabi, a jute trader in Pabna Sadar upazila, said farmers and traders were both suffering due to low prices.

“It costs us more than Tk 4,200 to buy a maund of jute from the market and transport it to a jute mill. But mill owners are unwilling to buy jute at this price and want to purchase it at even lower rates,” he said.

Md Aktaruzzaman Chan, a trader at one of Faridpur’s largest jute markets, said prices had become unpredictable.
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“We cannot understand the market trend this year. Jute that was selling for Tk 5,200 per maund suddenly fell to Tk 3,500. It has recovered somewhat to Tk 3,800, but we do not know whether prices will rise further as demand in the market remains low,” he said.

Moktar Molla, president of the Faridpur Jute Farmers Association, said production costs had risen by Tk 4,000 to Tk 5,000 per bigha.

He said jute prices had fallen from Tk 5,200 to Tk 4,000 per maund in one-and-a-half months, while yields declined by two to three maunds per bigha. Farmers spend Tk 3,500 to Tk 3,800 to produce a maund.

He warned that farmers could lose interest in jute cultivation if they failed to receive fair prices.

“The price of jute has fallen because exports of raw jute remain suspended,” he alleged.

EXPORT CURBS HURT DEMAND

Khandaker Alamgir Kabir, chairman of the Bangladesh Jute Association, said local demand for jute is around 60 lakh bales annually, while production is expected to exceed 80 lakh bales this year.

He said the surplus has traditionally been exported, but the then interim government had imposed conditions on raw jute exports on September 8, 2025.

“We thought the conditions would be withdrawn after a while,” Alamgir said.

The restrictions have prevented farmers from getting expected prices, he added.

“Since the conditions were imposed, we repeatedly requested the adviser to the then interim government responsible for the jute ministry, as well as the minister of the current government, to withdraw them. But no one is listening to us,” he said.

Md Rishad Abdullah, chief scientific officer at the Bangladesh Jute Research Institute, Faridpur station, said farmers usually cultivate the GRO-524 variety of jute, which is vulnerable to excessive water.

“Many farmers harvested jute before it reached full maturity,” he said, adding that it lowered quality and prices.

Mizanur Rahman, assistant director of the Department of Jute in Faridpur, said cultivation had increased this year as farmers received good prices last year.

“Jute production is also expected to be higher this year. However, the suspension of raw jute exports has reduced demand in the market, which has affected prices. If raw jute exports resume, prices could reach Tk 5,000 to Tk 5,500 per maund,” he said.

Asked whether any measures were taken to raise prices, Mizanur Rahman said their office only conveys concerns to higher authorities as it cannot make policy decisions.

Chattogram customs house is set to auction goods from 442 containers from August 27 to September 16 as part of efforts to clear long-abandoned consignments occupying valuable space at Chattogram port.

Around 2.4 lakh tonnes of imported goods worth nearly Tk 9,000 crore have been lying abandoned at the port for years, occupying about 18 percent of its total capacity, according to port and customs officials.

The abandoned consignments, imported between 2013 and 2024, include various chemicals, machinery and machinery parts, fabrics, yarn, plastic waste, tiles, salt, paper, household goods and other items.

The prolonged storage has not only blocked port space but also deprived the government of revenue and caused financial losses to shipping agents.

To address the backlog, Chattogram Customs has launched two e-auctions involving 442 containers in 210 lots
Customs officials said importers often abandon consignments when market prices fall, original documents or clearance permits are unavailable, or they refuse to pay fines imposed for import irregularities.

To address the backlog, Chattogram Customs has launched two e-auctions involving 442 containers in 210 lots. The initiative aims to ease container congestion, increase port efficiency and prevent the wastage of state resources.

Under a special e-auction, 290 containers in 101 lots will be auctioned. The consignments include chemicals, machinery, plastic waste, chest freezers, pipes, yarn, fabrics, solar modules, salt, paper, tiles and household goods, along with 86 old empty containers. No reserve price has been set for these consignments.

Another 152 containers in 109 lots will be auctioned under a separate e-auction. The consignments include capital machinery, fabrics, PVC flex banners, chemicals, air-conditioner parts, tiles, stainless steel coils, scanners, badminton rackets, elevators and salt.

The entire auction process will be conducted digitally through the customs e-auction platform to ensure transparency and accountability.

Bidders are required to upload a scanned copy of a security deposit equivalent to at least 10 percent of their proposed bid amount and submit the original documents within the stipulated time.

Port and customs officials said delays in the auction process have allowed many consignments to deteriorate, resulting in further losses and wastage of valuable foreign currency.

The authorities have taken several measures, including amendments to auction rules, to expedite the disposal of abandoned goods.

The National Board of Revenue expects the technology-driven auction process to help increase the operational capacity of Chattogram port, ease container congestion and ensure more effective management of state resources.

The government has formed a committee to devise work procedures for the transition of the fiscal year from July-June to April-March.

Headed by the cabinet secretary, the five-member committee will determine the required changes to the Constitution, the General Clauses Act, 1897 and other aspects of the government’s financial management, according to a notification issued by the Cabinet Division on Sunday.

The move comes a week after the cabinet decided to change the country’s fiscal year cycle to April 1-March 31, with the new cycle taking effect in FY2028-29. The move away from the July-June cycle is aimed at avoiding monsoon-related delays in vital infrastructure development.

To facilitate a smooth transition, the 2027-28 fiscal year will serve as a nine-month transitional year (July-March).

The move away from the July-June cycle is aimed at avoiding monsoon-related delays in vital infrastructure development
Currently, key infrastructure works continue into July and August, when heavy rains frequently cause project delays, compromise the quality of construction and lead to widespread public suffering.

Shifting the cycle to April-March will allow major infrastructure development activities to be completed before the monsoon season begins, according to the Cabinet Division. Other members of the committee include the Bangladesh Bank governor, finance secretary, legislative and parliamentary affairs secretary and the chairman of the National Board of Revenue.

The committee will begin work immediately.

Bangladesh spends only about 0.3 percent of its gross domestic product on research and development (R&D), one of the lowest rates among peer middle-income countries, Finance and Planning Minister Amir Khosru Mahmud Chowdhury said yesterday.

Speaking at the Bangladesh Industry Research, Development and Innovation (BIRDI) Grants Awarding Ceremony in Dhaka, he highlighted countries such as South Korea, China, India and Vietnam, which invest significantly more in R&D, to underscore the gap Bangladesh needs to close.

The event, organised by the Skills for Industry Competitiveness and Innovation Program (SICIP) under the finance ministry at the InterContinental Dhaka, was attended by representatives from industry, academia and development partners.

Citing Bangladesh Bureau of Statistics data at the event, the minister said the picture is worse at the industrial level, with manufacturing enterprises spending, on average, less than Tk 500 per worker annually on research and innovation.

As a result, Bangladesh continues to struggle to compete for global market share, foreign direct investment and high-value employment, he said.

The minister said the country must shift decisively towards a research-driven, innovation-based economy, with greater investment in R&D, stronger industry-academia collaboration and a clear focus on practical solutions.

High-return research cannot flourish in isolation, and needs coordinated action among industry, academia and government, he added.

Universities have often produced theoretical research with limited commercial use, he said, while industrial enterprises have faced inefficiencies without sufficiently using domestic scientific talent.

Competing purely on low wages is no longer viable, Khosru added, urging Bangladesh to build a more sophisticated, innovation-driven production base.

Qingfeng Zhang, country director of the ADB Bangladesh Resident Mission, said the country’s next phase of growth depends on developing homegrown innovators and moving up the value chain through productivity, technology and quality jobs.

While technologies can be imported, local capability to identify problems, adapt tech, and bring solutions to market must be built within Bangladesh, he noted.

Zhang said the BIRDI grants align with ADB’s $300 million financing for SICIP, bridging industry, academia and finance to tackle real business challenges beyond traditional skills training.

During the event, twelve research projects spanning pharmaceuticals, textiles, agriculture, electric mobility, electronics and energy received grants totalling more than Tk 21 crore in the programme’s first round.

Each project pairs an industry partner with a research team to tackle challenges such as AI-driven fabric inspection, water-saving smart dyeing, vaccine-grade enzymes and solar-powered cold storage.

The Money Changers Association of Bangladesh (MCAB) has set new exchange rates for the kerb market to help stabilise and regulate cash dollar prices.

Licensed money changers now can sell US dollars at a maximum of Tk126.50 and buy at Tk125.50, MCAB President MS Zaman announced at a press conference in Dhaka today (24 August).

Several money changer owners said the cash dollar rate had recently climbed to as high as Tk128 in the kerb market. They said remittance inflows through expatriates carrying cash into Bangladesh had declined, while demand for cash dollars had increased after India reopened medical and travel visas for Bangladeshis.

Treasury officials at several public and private banks said banks bought remittances from expatriate Bangladeshis at Tk122.30 per dollar on Sunday. Banks, meanwhile, settled letters of credit at rates of up to Tk122.95 per dollar.

Zaman said the new rates were being communicated to all money changers across the country through MCAB's website.

'Money changers not behind volatility'

On dollar market volatility, Zaman rejected allegations that money changers manipulate rates, saying the sector lacks the scale and capital to influence the market. He instead blamed banks for creating instability and profiting from it in the post-Covid period.

He said money changers only trade cash currencies and cannot directly bring in remittances. Their main source of foreign currency is cash carried by returning travellers and expatriate workers, which they bring into formal channels and thereby indirectly support reserves.

Zaman said BB regulates the interbank market and sets rates for scheduled banks, but lacks similarly clear guidelines for money changers. He called for clearer rules, greater scope for legal foreign currency trading and simpler policies to curb the illegal market.

MCAB has also shared a list of illegal and unlicensed money changers with Bangladesh Bank, law enforcement agencies and journalists, he said, adding that licensed operators were following the central bank's instructions.

Bangladesh and India discussed lifting Dhaka’s restrictions on Indian yarn imports through land ports, alongside reopening closed border haats and bringing land ports into full operation as the two neighbouring countries seek to strengthen bilateral trade.

The issues came up at a meeting between Commerce Minister Khandakar Abdul Muktadir and Indian High Commissioner to Bangladesh Dinesh Trivedi at the Secretariat in Dhaka yesterday, according to a ministry statement.Muktadir said bilateral trade currently stands at around $13 billion, but trade activities had slowed somewhat over the past one and a half years because of several obstacles.

Discussions were held on how to identify these problems and make trade relations between the two countries easier and more effective in the future, the statement said.

India is Bangladesh’s second-largest trading partner after China, and the two countries have longstanding economic ties, said the commerce minister.

He said the meeting focused on making land ports fully operational, reopening closed border haats and withdrawing the existing restriction on yarn imports through land ports.

The two sides also discussed forming a joint task force and developing digital infrastructure to increase cooperation between businesses, create new investment opportunities and accelerate trade.

Muktadir expressed hope that the Indian high commissioner’s initiatives would further strengthen Bangladesh-India relations and take economic cooperation to a new level.

Trivedi said that while the two countries have some political and economic differences, ordinary people want development and progress. Both countries, he added, must work together for the future of the younger generation.

“Bangladesh and India are two independent and sovereign countries. Neither is bigger or smaller; everyone is equal. The two countries must continue to work on the basis of this equality,” he said.

He said economic cooperation is the most important factor in improving bilateral relations, adding that stronger economic ties would lead to greater cooperation in other areas.

Trivedi also stressed the importance of joint investment and production, pointing to the global success of Bangladesh’s ready-made garment sector.

He said India can support the sector by supplying zippers, machinery, buttons and other inputs to increase mutual interdependence between the two countries.

The high commissioner said he feels proud to see garments bearing the “Made in Bangladesh” label in international markets.

The garment sector could expand further through joint initiatives between the two countries, he added.