Foreign aid commitments fell sharply in fiscal year 2025-26 while debt servicing climbed to a record high, highlighting the country's tightening external financing conditions as it grapples with slowing concessional inflows and rising repayment obligations.
Predictable policies key to attracting FDI
Total foreign assistance commitments dropped 37 percent to $5.24 billion in FY26 from $8.32 billion a year earlier, according to provisional data from the Economic Relations Division (ERD).

The fall was driven by a sharp reduction in project loan commitments, which declined to $5.01 billion from $7.94 billion a year earlier. Grant commitments also fell to $233.78 million from $381.65 million.

Foreign aid disbursements also declined, though at a slower pace.

Bangladesh remittance inflow stays below $3b for second consecutive month
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Bangladesh remittance inflow stays below $3b for second consecutive month
Bangladesh received $8.07 billion in foreign assistance during FY26, down from $8.57 billion in the previous fiscal year. Project aid disbursements fell to $8.02 billion from $8.52 billion, while grant disbursements increased to $553.95 million from $454.56 million.

Meanwhile, the country's external debt-servicing burden continued to rise.

Bangladesh paid $4.49 billion in principal and interest on foreign loans during FY26, up from $4.09 billion a year earlier, an increase of nearly 11 percent.

Principal repayments rose to $2.95 billion from $2.60 billion, while interest payments increased to $1.54 billion from $1.49 billion. In local currency, total debt servicing climbed to Tk 54,957 crore, compared with Tk 49,391 crore in FY25.

Institutional reforms, stronger negotiating capacity and greater policy independence will determine Bangladesh's next phase of development, economists and business leaders said today (2 August) at a discussion organised by the Policy Research Institute (PRI).

The remarks came during a seminar titled "Development Strategy and Policy Independence: Navigating Bangladesh's Development Pathway," which brought together economists, academics, business leaders and policymakers to discuss the country's long-term development strategy.

Speaking as the featured speaker, Anisuzzaman Chowdhury, professor emeritus at Western Sydney University and former special assistant to the chief adviser of the interim government, said policy independence is fundamental to Bangladesh's long-term economic development.

He said Bangladesh's economic transformation was built on independent policy choices, including the privatisation initiatives introduced during former president Ziaur Rahman's administration, the rise of the ready-made garment industry and agricultural integration.

However, reforms have increasingly been shaped by external pressures rather than national priorities. Citing South Korea and Vietnam, Anisuzzaman said their success stemmed from pursuing consistent, nationally driven policymaking.

He also stressed the need to strengthen social capital, empower civil society, remove vested interests and depoliticise public institutions to ensure effective governance and greater policy autonomy.

He expressed optimism that Bangladesh's young population would increasingly drive demand for reforms as tightening global immigration policies make overseas migration more difficult.

Moderating the discussion, Zaidi Sattar, chairman of PRI, said, "Bangladesh has significantly reduced its dependence on foreign aid, which now accounts for less than 2% of GDP, while more than 90% of its external public debt remains concessional, carrying an average interest rate of 1.3% and a 23-year repayment period."

Other panellists also stressed the need for reforms. Kamran T Rahman, president of the Metropolitan Chamber of Commerce and Industry, said governance and reform conditions attached to World Bank and IMF financing largely reflect reforms Bangladesh should pursue regardless.

Fahmida Khatun, executive director of the Centre for Policy Dialogue, said stronger institutions and negotiating capacity would be essential as Bangladesh graduates from least developed country status amid an increasingly polarised global environment.

AKM Waresul Karim, dean of the School of Business and Economics at North South University, warned that rising public debt, expensive domestic borrowing and banking sector weaknesses pose long-term risks, calling for prudent fiscal management and financial sector reforms.

Selim Raihan, executive director of Sanem, said the outcomes of engagement with development partners depend largely on Bangladesh's own negotiating capacity.

Md Rezwan Selim, vice-president of BGMEA, raised concerns over education quality and brain drain, while guest speaker Imran Matin said no public policy can be implemented independently of the country's strong social and community forces.

Participants agreed that sustaining Bangladesh's development momentum will require stronger institutions, policy consistency and broader engagement among policymakers, businesses, researchers and civil society.

The United Kingdom has reaffirmed its commitment to provide up to £2.0 billion in financing support through UK Export Finance (UKEF), reinforcing its long-term economic partnership with Bangladesh as the country prepares to graduate from least developed country (LDC) status.

The support also aims to encourage British companies to trade and invest in Bangladesh, and strengthen Bangladesh's overall market competitiveness as the country seeks to sustain its export competitiveness in key overseas markets, sources said. Although the credit facility had been offered previously, its strategic importance was recently reaffirmed in a formal letter from British High Commissioner Sarah Cooke to Bangladesh's Commerce Secretary, underscoring London's long-term economic partnership with Dhaka.

The commitment was conveyed in a congratulatory letter from the British High Commissioner to Md Ataur Rahman Khan on his appointment as Commerce Secretary.

According to the letter, the UKEF facility will help mobilise financing for projects involving UK goods and services, encourage British companies to expand their business in Bangladesh, and create new opportunities for Bangladeshi exporters.

The envoy said bilateral trade between the two countries reached £4.5 billion in 2025, marking 13 per cent year-on-year growth and reflecting the strengthening commercial relationship.

She also noted that cumulative UK foreign direct investment (FDI) in Bangladesh had reached £848 million by the end of 2024.

Reaffirming the UK's continued market access support, Ms Cooke said Bangladesh remains the single largest beneficiary of the Developing Countries Trading Scheme (DCTS).

Under the scheme, Bangladesh will continue to receive the UK's most generous duty-free preferences during a three-year transition period after LDC graduation.

Thereafter, the country will move to the DCTS Enhanced Preferences tier, under which 92 per cent of UK tariff lines, including ready-made garments (RMG), will continue to enjoy duty-free market access.

The letter also highlighted revised DCTS rules of origin for ready-made garments, saying the updated provisions are intended to preserve Bangladesh's preferential access to the UK market while providing greater certainty for exporters, manufacturers and British buyers over the long term.

To maximise utilisation of the financing package, the British High Commission in Dhaka will organise webinars and business outreach programmes to familiarise Bangladeshi companies with UKEF financing facilities and other UK trade support mechanisms.

The High Commissioner also expressed interest in meeting the Commerce Secretary to explore new avenues for expanding bilateral trade, investment and broader economic cooperation.

Sources said the financing pledge signals the UK's intention to remain a key long-term economic partner for Bangladesh as the country transitions beyond LDC status and pursues higher-value trade and investment.

Trade experts and economists said the biggest challenge of LDC graduation is retaining preferential market access.

They noted that the UK's DCTS benefits, together with more flexible rules of origin, would help reduce long-term uncertainty and reassure foreign buyers to place long-term orders with confidence.

They added that the £2.0 billion credit facility presents a significant opportunity.

However, unless bureaucratic bottlenecks in project implementation are addressed and the financing is channelled into high-quality, sustainable projects, Bangladesh will not be able to fully realise its benefits.

They also said that, even with continued duty-free market access, compliance with environmental, social and governance (ESG) standards, alongside improvements in infrastructure, will remain essential for maintaining competitiveness in the UK market.

Commenting on the £2.0 billion UKEF facility, Professor Mustafizur Rahman, Distinguished Fellow at the Centre for Policy Dialogue (CPD), said the financing model offers substantial mutual benefits by strengthening exports for both the UK and Bangladesh while supporting a smooth transition from LDC status.SDG financing guidance

However, he cautioned that the ultimate success of the financing package would depend largely on how effectively the supported projects are designed and implemented.

He said Bangladesh must urgently enhance domestic productivity, develop workforce skills and strengthen international marketing capacity.

At the same time, reliable electricity and gas supplies, along with improved physical infrastructure, would be essential to maximise the benefits of the investment

The government and private-sector leaders have agreed to adopt the "Vietnam model" as a benchmark to diversify Bangladesh's export basket and accelerate outward trade growth, outlining a series of policy interventions aimed at eliminating longstanding bottlenecks to trade and investment.

The decision emerged from a high-level, four-hour interactive meeting between Prime Minister Tarique Rahman and top private-sector entrepreneurs at the Prime Minister's Office (PMO) in Tejgaon on Saturday.

Organised by the Bangladesh Investment Development Authority (BIDA), the meeting focused on export diversification, trade facilitation, and how to tackle the ongoing industrial power crunch.

Speaking at the session, Prime Minister Tarique Rahman expressed optimism that joint efforts between the public and private sectors could transform the national economy within the next four to five years.

"We all acknowledge that there are many problems, but if we work together, we can overcome them," the Prime Minister said. Noting that his administration -- less than six months in office -- has already held multiple sits-down with the business community, he announced that follow-up dialogues would take place every two to three months to monitor progress.

Of the 28 issues raised during the previous consultation, official sources confirmed that decisions were already taken on 21, with implementation underway for the remaining seven.

Key measures include introducing 24-hour operations at Chattogram Port and Dhaka airport, establishing internationally accredited testing laboratories under public-private partnership (PPP) arrangements for export products, and expediting business-related approvals and trade facilitation.

During the meeting business leaders called for easier access to credit, greater policy support and a more business-friendly environment to facilitate investment and industrial growth. They also appreciated a number of recent government initiatives and expressed satisfaction with the progress made so far.

Speaking after the meeting, Meghna Group of Industries (MGI) Chairman Mostafa Kamal said the Prime Minister held a candid and constructive discussion with business leaders.

He said that effective action had already been taken on eight to nine of the 20 agenda items discussed at the previous meeting. To monitor progress, it was decided that the Prime Minister would hold follow-up meetings with business leaders in every two months.

"The business community expressed satisfaction with the current investment-friendly environment," he added.

However, several participants said they had been requested not to make individual comments to the media after the meeting.

Requesting anonymity, one business leader told The Financial Express that the discussions were entirely focused on boosting exports rather than addressing company-specific issues.

"No participant raised any individual business concerns. We discussed export opportunities and challenges under the ten agenda items prepared by the Prime Minister's Office," he said.

Business leaders highlighted persistent gas and electricity shortages as well as tariff and non-tariff barriers affecting exports. According to the participant, the Prime Minister immediately instructed the relevant ministers and senior officials to resolve several issues, while the officials concerned assured the meeting of prompt follow-up.

Another business leader said the government confirmed that Chattogram Port would soon begin round-the-clock operations, a long-standing demand from exporters first raised at the previous meeting to speed up export shipments.

The participants also highlighted the lack of internationally recognised testing facilities as a major obstacle to exports.

Following discussions, the Prime Minister proposed establishing internationally accredited testing laboratories through PPP arrangements, under which the government would provide land while private investors would finance and operate the facilities. Foreign investment in such laboratories would also be welcomed, business leaders said.

Another business leader said the pharmaceutical industry received special attention during the discussions.

He said the meeting reviewed Bangladesh's post-LDC graduation challenges, particularly the possible loss of patent-related flexibilities for the pharmaceutical sector. Discussions focused on accelerating the implementation of the API Industrial Park and ensuring policy support for domestic production of active pharmaceutical ingredients (APIs).

"We also informed the Prime Minister that international certification remains a major hurdle for pharmaceutical exports. We requested that certification authorities from the US, the UK and other developed countries conduct inspections in Bangladesh and that recognition by overseas regulatory authorities be facilitated," the participant said.

Business leaders also proposed visa-free entry for investors from the United Kingdom, the United States, Japan and South Korea, along with a streamlined online visa system to make it easier for investors from all countries to obtain Bangladeshi visas.

Following the meeting, Prime Minister's Office spokesperson Mahdi Amin told reporters that the government had decided to introduce uninterrupted 24-hour services at the country's ports to facilitate import and export trade, with implementation expected shortly.

He said the government also pledged full policy support to revive the private sector and overcome the prolonged economic slowdown.l

Mahdi Amin said Bangladesh had regained democratic momentum and broader economic stability under the leadership of Prime Minister Tareq Rahman.

He added that Sergio Gor, a representative from the United States, had highly appreciated the government's positive initiatives over the past five months.

As part of growing international interest, a delegation comprising 45 business executives and investors from 25 leading US companies is expected to visit Bangladesh by the end of next week to explore business opportunities, he said.

The spokesperson noted that years of authoritarian rule had left many state institutions requiring structural reforms. He added that the meeting included extensive discussions on resolving critical challenges, particularly in the power and energy sectors.l

Another business leader, speaking on condition of anonymity, told The Financial Express that the country's energy situation dominated the nearly four-hour discussion.

"Energy has become the most pressing challenge facing all industries," he said.

"The most encouraging aspect of the meeting was that the Prime Minister's Office asked participants at the outset not to raise company-specific issues. Instead, discussions were centred on macroeconomic challenges facing the overall industrial sector."

He said this enabled the Prime Minister to hear firsthand the concerns of businesses across different sectors. Representatives from a wide range of industries shared their views, while the Prime Minister immediately directed the relevant ministers and officials to address several issues raised during the meeting.

The participant added that government officials outlined the steps already taken to ease the energy crisis and sought recommendations from business leaders on what additional measures could be adopted.

The government also requested suggestions on policies to accelerate the adoption of renewable energy.

Another business leader said the Prime Minister sought recommendations on priority sectors to achieve Bangladesh's target of US$100 billion in exports by 2030.

He said the government had identified 10 non-RMG sectors, each with an export target of US$3 billion, while using Vietnam as the benchmark for export-led industrial development.

"The discussion focused on Vietnam's current position and what Bangladesh needs to do to achieve similar success," he said.

Participants also agreed to speed up customs procedures, the bonded warehouse system, and cargo clearance at ports for both raw materials and finished goods. Faster processing of registrations and approvals, including those by BIDA, was also agreed upon to improve the ease of doing business.

During the meeting the Prime Minister said open dialogue was the most effective way to identify solutions and voiced confidence that continued engagement between the government and the private sector could bring meaningful improvements to the country's economy within four to five years.

Finance and Planning Minister Amir Khosru Mahmud Chowdhury, Home Minister Salahuddin Ahmed, Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood Tuku, Commerce, Industries, Textiles and Jute Minister Khandaker Abdul Muqtadir, Road Transport, Bridges, Railways and Shipping Minister Sheikh Robiul Alam, Prime Minister's Adviser on Finance and Planning Rashed Al Mahmud Titumir, BIDA Executive Chairman Ashik Chowdhury, Bangladesh Bank Governor Mostakur Rahman and other senior government officials and representatives of leading business groups were also present.

The government has allowed the import of green chilli to increase supply and cool prices, Agriculture Minister Mohammed Aminur Rashid said yesterday.

Import activities will begin today, and prices are expected to drop to a tolerable level within two to five days, he said after visiting the Shantinagar kitchen market in the capital.

Commerce Minister Khandakar Abdul Muktadir and Dhaka South City Corporation Administrator Md Abdus Salam were also present.

Green chilli prices doubled in a week and have now crossed Tk 400 a kilogramme amid heavy rainfall-induced crop losses.

The agriculture minister said the import duty on green chilli would be cut.

Earlier in the day, the commerce minister, the agriculture minister, and State Minister for Food Md Abdul Bari held a meeting at the commerce ministry to review the overall market situation of essential commodities.

Bangladesh secured $5.24 billion in foreign loan commitments from development partners in FY26, the lowest in 14 years, according to the latest Economic Relations Division (ERD) data.

The last time commitments were lower was in FY12 at $4.76 billion. In FY15, the figure was almost similar at $5.26 billion. FY26 commitments were also significantly below FY25's $8.32 billion. Before the interim government took office, annual foreign loan agreements or commitments generally remained between $9 billion and $10 billion, ERD data show.

The ERD report released today (2 August) said $1.56 billion of FY26 commitments came as budget support. Officials of the Division said the government focused more on budget support than conventional project loans amid global uncertainty, including Middle East conflicts.

It also reallocated financing from slow-moving projects to energy and food security. Around $1.06 billion was repurposed and released in June for energy needs.

M Masrur Reaz, chairman and founder of Policy Exchange Bangladesh, said the interim government's non-political nature and highly conservative spending policy slowed public investment and almost halted new projects.

"Since there was little need to start new projects, the interim government did not extensively negotiate new foreign financing beyond IMF and World Bank budget support," he said.

He added that development partners adopted a wait-and-see approach after the election schedule was announced, assessing the elected government's priorities, financing strategy and policies before making new commitments.

Mustafa Kamal, executive director of the Institute for Inclusive Finance and Development (InM), said the new government needs time to restart negotiations as development partners assess its policies and implementation capacity.

"Many projects had preliminary discussions and commitments during the interim government. After the new government took office, those require fresh coordination, understanding and agreements," he said.

Record foreign loan repayment

Bangladesh made its highest-ever foreign loan repayment in FY26, paying $4.49 billion to development partners, up from $4.09 billion a year earlier. The repayment rose 9.96% year-on-year, with principal payments reaching a record $2.95 billion, up 13.82%, while interest payments increased to $1.54 billion from $1.49 billion.

ERD officials said repayments rose as grace periods for many earlier loans expired. Masrur Reaz said loans taken since FY20 have entered the repayment phase, increasing pressure on foreign currency earnings and creating macroeconomic challenges.

He urged the government to remain cautious about future borrowing and prioritise projects with high economic and human returns.

Foreign loan disbursement falls

Foreign loan disbursement fell to $8.07 billion in FY26 from $8.57 billion a year earlier. ERD officials attributed the decline to administrative uncertainty, lower confidence among development partners, slower project implementation due to elections and reviews of several projects after the new government took office.

The Asian Development Bank (ADB) provided the highest loan commitment in FY26 at $2.69 billion, including $1 billion in budget support. The World Bank committed $820 million, Japan $314 million, China $279.94 million and the Asian Infrastructure Investment Bank (AIIB) $250 million.

The World Bank led disbursement with $2.74 billion, followed by ADB with $1.91 billion and Russia with $1.05 billion. The AIIB disbursed $692 million, Japan $795.32 million, China $532.88 million and India $278.66 million.

The country's premier bourse witnessed a significant surge in liquidity today (2 August) as investors reacted to the central bank's first policy rate cut in nearly two years.

Market turnover on the Dhaka Stock Exchange jumped by 21% to reach Tk1,257 crore, compared to the previous week's average, as participants initially cheered the shift towards monetary easing.

However, despite the liquidity injection and a strong start that saw the benchmark index scale an intraday high of 5,938 points, the market failed to sustain its momentum.

Broad-based profit-taking in the final hour of trading, coupled with persistent concerns over domestic industrial challenges and geopolitical jitters, dragged the index back to close on a largely flat note, according to the market insiders.

The benchmark DSEX index ended the day at 5,895 points, while the blue-chip DS30 index managed a marginal gain of 3 points to settle at 2,213.

Market breadth remained positive as 193 issues advanced, 149 declined, and 45 remained unchanged.

According to the daily market review by EBL Securities, the benchmark index remained afloat throughout most of the session but lacked the necessary buying conviction to consolidate above the psychological 5,900-point threshold.

The brokerage noted that even the long-awaited policy rate cut could not fully offset investor anxiety regarding domestic energy supply disruptions and the evolving situation in the Middle East. Heavyweight scrips faced intensified selling pressure towards the close, which eroded the morning's substantial gains.

Sheltech Brokerage Limited highlighted that the market's performance was primarily shaped by an early buying frenzy followed by gradual distribution. The brokerage pointed out that while the central bank's move to ease interest rates provided a temporary lift, the ongoing gas supply crisis and uncertainty surrounding proposed margin lending rule amendments prompted many investors to lock in profits after the early peak.

On the sectoral front, the textile sector dominated market activity, accounting for 21.4% of the day's total turnover, followed by general insurance and pharmaceuticals, both contributing 11.9%.

In terms of returns, mutual funds emerged as the top-performing sector with a 5.6% gain, followed by jute and services. Conversely, the cement, life insurance, and banking sectors faced corrections, with several large-cap lenders acting as primary index draggers, including Islami Bank Bangladesh, Al-Arafah Islami Bank, and National Bank.

Individual stock performance was highlighted by Green Delta Mutual Fund, which hit the 10% upper circuit limit. Other top gainers included Usmania Glass, Prime Insurance, and Queen South Textile.

On the flip side, S Alam Cold Rolled Steels was the top loser, shedding 7.85% of its value, followed by BIFC and Sena Insurance.

The positive sentiment was partially mirrored at the Chittagong Stock Exchange, where the broad CASPI index rose by 33 points to reach 15,794. However, the port city bourse saw a sharp 79% decline in trading volume, with turnover settling at a mere Tk9.82 crore.

The National Board of Revenue (NBR) has announced a tax incentive of up to 5 per cent for individual taxpayers who file their income tax returns by September 30, aiming to encourage voluntary tax compliance and timely submission of returns.

Under a new provision of the Income Tax Act, 2023, individual taxpayers and Hindu Undivided Families (HUFs) that file their returns between July 1 and September 30 will receive a tax rebate equivalent to 5 per cent of the tax payable, subject to a maximum benefit of Tk 25,000.

However, no tax incentive will be available for returns filed between October 1 and December 31.

The revenue authority has also introduced penalties for delayed filing. Taxpayers submitting returns between January 1 and March 31 will have to pay an additional tax equivalent to 2 per cent of the tax payable or Tk 3,000, whichever is higher.

Those filing returns between April 1 and June 30 will have to pay an additional 5 per cent of the tax payable or Tk 5,000, whichever is higher.

In a press release issued on Sunday, the NBR said the incentive is expected to encourage taxpayers to file returns at the beginning of the filing season, strengthen the culture of voluntary tax compliance and improve the efficiency of tax administration.

The NBR also reminded taxpayers that its e-Return service for the 2026-27 tax year was launched on July 22. Taxpayers can file their returns online through the e-tax portal and pay taxes using bank transfers, debit and credit cards, as well as mobile financial services such as bKash, Nagad and Rocket.

The revenue board said taxpayers would receive instant acknowledgement receipts and income tax certificates after successfully submitting accurate returns online. It added that officials would provide assistance through the NBR call centre and other electronic platforms during office hours, except on government holidays.

The NBR urged taxpayers to file their returns by September 30 to avail themselves of the tax rebate, as no incentive will be available for returns submitted after the deadline.

Bangladesh Bank (BB) has reduced its key policy rate (repo rate) by 50 basis points to 9.50 percent from 10 percent, aiming to boost private sector credit flow, spur investment, and accelerate economic recovery and employment generation.

The central bank issued a circular on Sunday (August 2) to the managing directors, chief executive officers, and administrators of all banks and finance companies, confirming that the new rates take effect immediately from August 2, 2026.

The decision was taken at a meeting of the Monetary Policy Committee (MPC) held on July 30, 2026, superseding the earlier policy rate corridor set in February 2026.

Under the re-aligned policy rate corridor, the upper limit—the Standing Lending Facility (SLF) rate—has also been slashed by 50 basis points to 11.0 percent from 11.50 percent.

However, the lower limit of the corridor, the Standing Deposit Facility (SDF) rate, remains unchanged at 7.50 percent.

According to the circular signed by Dr. Mohammad Monirul Islam Sarkar, Director of the Monetary Policy Department (MPD), the downward adjustment in policy rates is intended to facilitate private credit growth and create a more favorable environment for job-creating investments across the country.

Recent policy-rate cut, meant to spur sagging economic activity with availability of funds, pushes down treasury yields, call-money rate and also deposit interest in a domino effect on the money market.

To accelerate growth in credits to the private sector, the lifeline of Bangladesh's US$500-billion economy, from months of economic sluggishness, Bangladesh Bank on July 30 lowered the benchmark repo rate by 50 basis points to 9.50 per cent after 22 months with effect from Sunday.

On the first day of the post-policy-rate-cut regime, the yields on treasury bills plummeted by in-between 46 and 50 basis points while call-money rate dropped 23 basis points.

Such massive fall in the yields on government treasuries frustrates the commercial bankers as the scope of making some risk-free gains amid squeezing investment avenues due to prolonged economic slowdown keeps shrinking.

In an immediate effort to pass on the policy-rate cut, commercial banks start lowering the deposit rate, too, in-between 50 basis points to 1.0-percentage points.

According to BB sources, the yields on 91-day, 182-day and 364-day treasury bills dropped to 9.30 per cent, 9.53 per cent and 9.53 per cent from last week's count of 9.79 per cent, 9.99 per cent and 10.03 per cent respectively.

The government has borrowed Tk 70 billion on the days through issuing these three categories of the bills to meet its budgetary shortfalls.

The situation is almost same on the interbank call-money market where banks borrow and lend surplus funds among themselves on an overnight or short-notice basis to manage daily liquidity requirements.

The rate on call money dropped to 9.52 per cent on Sunday from last Thursday's rate of 9.75 per cent.

Seeking anonymity, a BB official said the regulator cut the policy rate to boost lending growth through discouraging risk-free investment like in treasury bills and bonds in a bid to revive the overall economic growth.

"The fall in the yields of treasury bill is a good sign for the economy. If it continues, it will force the banks to concentrate on lending to private sector, which is the main objective of the banks," the central banker told The Financial Express.

On condition of not being quoted by name, the treasury head of a private commercial bank said the demand for private-sector credits dropped significantly over the months for various factors, leading to the sluggishness.

On the other hand, he said, the commercial lenders became very cautious in approving loans to the entrepreneurs because of higher non-performing loan (NPL) buildups. "So, there are very limited lending scopes."

Government securities were the only area where banks could make some gains through putting their funds into the risk-free investment instruments, he said.

"This opportunity is also squeezing. If the private-sector credit does not grow expectedly due to the existing energy crisis, it will be a huge blow to the banks for sure," he added.

About the deposit-cost adjustment in line with the policy-rate cut, he said his bank decided to cut deposit rate as much-by 50 basis points. "Some banks cut 100 basis points on deposit. But the lending rate is expected to be lowered later. It may take at least three months."

Director-General of Bangladesh Institute of Bank Management (BIBM) Dr Md. Ezazul Islam said the credit appetite of the private sector is expected to increase in the coming months due to various benefits like easy monetary-policy stance, Tk 600-billion stimulus package for reopening the shut industrial units and easy exit policy.

He noted that the volume of imports started increasing in recent days, which will certainly enhance the demand for trade financing. "So, I think things will improve in the coming days."

About the upcoming trend in yields on government securities, the economist said the yields would probably move close to the policy rate in the coming days.

The securities regulator has taken another step towards deregulating the capital market by decentralising its internal operations and restoring regulatory powers to the stock exchanges, aiming to speed up services and strengthen market oversight.

The latest move came last week when the Bangladesh Securities and Exchange Commission (BSEC) allowed market participants to submit routine applications and documents directly to the executive directors of the relevant departments instead of routing them through the commission chairman.

Under a directive issued on Thursday, self-regulatory organisations (SROs), listed companies, registered market intermediaries and other capital market-related entities and individuals will now submit general applications, reports, statements and correspondence directly to the executive directors of the respective BSEC departments.

Previously, such applications had to be sent to the BSEC chairman, resulting in delays as documents were processed through the chairman's office and signed by the BSEC chief and the commissioners before being forwarded to the relevant departments.

When asked for comment, BSEC Chairman Masud Khan said the change was part of the regulator's broader deregulation agenda aimed at ensuring greater accountability among officials and faster resolution of stakeholders' issues.

"Every day, around 100 to 150 general applications are submitted to the chairman before being forwarded to the concerned departments. The process wastes a lot of time," he said.

"It will be much faster if the letters go directly from the dispatch section to the concerned executive director."

Mr Khan said only specific complaints or policy matters should require the attention of the chairman or commissioners.

"As part of our mandate and the government's commitment to deregulation, the capital market will gradually see greater delegation of authority within the regulatory bodies to ensure quicker disposal of issues," he said.

Mr Khan said responsibility should rest with the officials entrusted with a particular task.

"If I intervene myself, they will avoid their responsibility," he said.

The commission is also shifting supervisory responsibilities back to the Dhaka Stock Exchange (DSE), allowing it to exercise powers already provided under existing regulations.

According to the BSEC chairman, the DSE will now be responsible for routine inspections of brokerage firms, while the commission will focus on investigations and formal inquiries.

When the DSE cited manpower shortages, Mr Khan said, he suggested appointing five or six audit firms to inspect high-risk brokerage houses under an annual schedule.

Using a standard operating procedure (SOP), the audit firms would examine issues such as deficits in consolidated customers' accounts (CCA), compliance with margin lending rules and the adequacy of back-office software before reporting their findings to the exchange, he added.

"This is another example of deregulation. The DSE should not have to seek my permission for inspections. The BSEC should intervene only after irregularities are identified," he said.

Mr Khan added that further measures to decentralise powers within the BSEC would be introduced in the coming months.

The regulator has already restored several powers to the DSE.

In July, the BSEC clarified the listing regulations, removing ambiguity over the exchange's authority to suspend trading of companies experiencing abnormal price movements unsupported by fundamentals.

The clarification followed a series of speculative rallies in weak companies, including Khan Brothers PP Woven Bag Industries, where prices surged on rumours before collapsing, leaving many retail investors with heavy losses.

Following the clarification, the DSE has begun suspending trading in companies showing unexplained price movements.

A senior DSE official said the move would help protect investors from speculative trading.

"Investors will now remain cautious because trading in a company can be halted at any time if abnormal price increases are not supported by fundamentals," the official said.

Last month, the BSEC also restored the exchanges' authority to determine circuit breaker limits for listed securities.

Although the listing regulations had already empowered the exchanges to set market control parameters independently, a regulatory directive issued in June 2021 had effectively curtailed that authority.

BSEC officials said the exchanges should be allowed to exercise powers already granted under their own regulations.

Meanwhile, the commission has agreed in principle to allow the stock exchanges to conduct immediate inspections of listed companies without prior regulatory approval where there is prima facie evidence of wrongdoing.

The move follows complaints from the exchanges that they were unable to inspect companies despite indications of mismanagement, financial irregularities or credible information from shareholders and insiders.

DSE officials said they submitted a draft amendment to the BSEC last month seeking inspection powers over listed companies.

After reviewing the proposal, the regulator requested a comprehensive amendment to the listing regulations, which is expected to take about two months to finalise, they said.

Print-outs of articles about the global memory chip shortage are pinned beside a price list at a Hong Kong computer shop, offering an explanation to confused customers feeling the pinch.

Price rises for goods such as laptops and smartphones, with cars potentially next, have been an unwelcome side-effect of the artificial intelligence gold rush -- and the squeeze is far from over.

Samsung Electronics’ chief financial officer said this week shortages of microchips that store digital data will likely deepen in 2027 and stay tight through 2028.

The crunch has been nicknamed “RAMaggedon” after the components called RAM, or “random-access memory”.

It is caused as profit-hungry chipmakers pivot to producing high-bandwidth memory (HBM) -- a more advanced type of computer memory in huge demand to help train and run AI tools.

The articles on display at In-Technology Services -- one of many compact vendors crammed into Hong Kong’s Wan Chai Computer Centre -- are to inform customers who “don’t know what happened,” manager Wade Lam told AFP.

The centre’s shops sell tech equipment of all sorts, from computer parts to gadgets and games consoles.

Ken Tam, manager of Videocom Computer, which specialises in custom-built PCs, said business has halved since price rises began in September.

Sixteen gigabytes of RAM used to cost HK$300-400 ($40-50) but the price has now hit HK$1,500, he said.

“When it suddenly gets so expensive, customers have a psychological barrier,” Tam told AFP.

“If they need it, they will buy it,” but otherwise they will wait, or “lower their standards” and buy a less high-performing memory chip, he said.

Analyst Ellie Wang at the Taiwan-based market research firm TrendForce said memory prices for PCs and smartphones were up around five to six times compared to a year ago.

The AI boom has brought humungous profits and share price jumps to the world’s top three memory chip makers: South Korea’s Samsung Electronics and SK hynix, along with US giant Micron.

In fourth place is ChangXin Memory Technologies (CXMT), which became mainland China’s most valuable company on Monday when it made its market debut in Shanghai -- another sign of how red-hot the sector has become.

CXMT, as a relative newcomer, “remains in a follower position regarding leading-edge technologies”, James Zhao, senior principal analyst at Omdia, told AFP.

HBM is used in data centre servers to support other powerful chips -- such as those made by US titan Nvidia -- that execute the dizzyingly complex calculations of AI systems.

But when it comes to conventional RAM, and a type for computers called DRAM, “the current supply-constrained market environment” could bring CXMT “late-mover advantages”, he said.

At a shopping centre in a different part of Hong Kong, customer Henry Wong, an investment banker, said he had chosen to upgrade the RAM in an older laptop instead of buying a new one with even better specs.

“After upgrading the memory, I found it ran really smoothly, and I stopped wanting to buy a new computer,” he told AFP.

Automakers say they are facing rising costs for in-vehicle computer systems, which could also soon push up the price of new vehicles.

In Tokyo’s tech hub of Akihabara, Charles Brousse, a 30-year-old graphic designer and custom PC builder from Belgium, said prices for RAM, graphics cards and motherboards have hit “ridiculous levels”.

For his “PC & Chill” service, Brousse does not buy parts to pre-build machines -- as it is too expensive -- but he requires clients to purchase their own that he assembles.

The chip shortage is pushing people to buy cheaper laptops than desktops, which can last up to a decade, said Brousse, in Tokyo on his honeymoon.

“I’m not sure that’s a good thing; people end up buying products with shorter lifespans, which fuels a cycle of consumption.”

Brousse added that the fact it is driven by the “speculative bubble” of AI is also frustrating, “because I’m a graphic designer by trade, so AI has a real impact on my profession.”

The port city bourse CSE has yet to launch operation of the country's maiden commodity exchange (CX), as regulatory approval for licences of commodity brokers and products has been remaining pending for around one year due to shareholding complications involving its strategic partner.

On installation of basic infrastructure needed for operations of the CX, the Chittagong Stock Exchange (CSE) sought approval for commodity items from the Bangladesh Securities and Exchange Commission (BSEC) in July last year.

The commodities selected by the port city bourse are gold, silver and crude oil.

The CSE also submitted seven applications to the securities regulator in October, 2025 seeking licences for commodity brokers.

But the port city bourse has not yet received any regulatory approvals for brokers as well as commodities.

When asked, CSE Managing Director M. Shaifur Rahman Mazumdar said the previous commission had refrained from issuing any licence and approving the commodities until the complications over the strategic partner's stake were resolved.

As per rules set for the CX, the exchange's strategic partner is not allowed to hold more than 25 per cent shares of the exchange.

ABG Ltd., a company of Bashundhara Group, became the CSE's strategic partner by purchasing the 25 per cent stake of the exchange.

The company also owns a brokerage firm, Stock & Brokerage Linkway, with a 0.51 per cent stake in the port city bourse.

As a result, the shareholding of the CSE's strategic partner -- ABG Ltd. -- has exceeded the stipulated ownership ceiling.

After resignation of immediate past BSEC chairman and commissioners, the new commission led by its Chairman Masud Khan took the charge in early June last.

The CSE managing director said they talked about the pending issue of broker licence and commodity items with the BSEC officials.

Asked, a BSEC official said on anonymity that the regulator realised the importance of the CX.

He said the regulator would analyse the complications to find out a solution required to commence operation of the CX.

To break the deadlock, Bashundhara Group will have to surrender the ownership of the brokerage firm to another party.

Mr Rahman said the conglomerate was ready to transfer the additional shares, but the National Board of Revenue (NBR) stopped the transfer of its assets.

"That's why the whole matter of the commodity exchange is hanging in the balance."

After the fall of the Awami League-led regime, the NBR in October 2024 requested the Department of Joint Stock Companies and Firms to suspend share transfer by seven groups, including Bashundhara, to prevent tax evasion. Since then, Bashundhara's share transfer has remained suspended.

The CSE managing director said the regulator had ways to resolve the complications involving the strategic partner's shareholding.

The regulator could either offer a waiver on mandatory shareholding by the strategic partner or could issue licences for the brokers alongside approving the commodities with a condition of resolving the shareholding complexity before commencing operation at the CX.

"Then the commodity brokers could complete necessary preparations before resolving the shareholding complications," Shaifur said.

The companies that applied for broker licences are LankaBangla Securities, BR Rich, Sohel Securities, Island Securities, Royal Capital, UCB Stock Brokerage, and NLI Securities.

They are operating on both Dhaka and Chittagong stock exchanges.

Similar to TREC (Trading Right Entitlement Certificate) holders of the bourses, a company will require a broker licence from the securities regulator to conduct trading at the CX.

As per rules, the minimum paid-up capital of a commodity broker will be Tk 100 million.

Apart from brokerage firms, other companies can also become commodity brokers by fulfilling the requirements.

A CX is a legal entity that determines and enforces rules and procedures for trading in standardised commodity contracts and related investment products.

US tech giants are pouring huge sums of money into building infrastructure to maintain their leadership in AI technology. Since the rise of AI in 2023, Google, Amazon, Microsoft and Meta have invested a total of 110,000 crores, or more than 1 trillion dollars, in the sector as of last June, according to the FT.

A large portion of tech giants' AI investments are being spent on data centers, advanced chips, and the power systems needed to run this infrastructure.

The report, by Ryan McMorrow, Rafe Rosner-Uddin and Hannah Murphy, says that investment in the technology sector, centered on AI, will increase further in the coming days. The four companies plan to spend a combined $745 billion this year.

Ryan McMorrow's team says that big tech companies are rapidly moving into AI infrastructure-based businesses. Running AI models and providing computing power to customers requires a huge amount of data centers, servers, and chips. As a result, the cost of building infrastructure is also rapidly increasing.

According to market analysts, the trend of increasing spending on AI infrastructure is unlikely to stop anytime soon. However, how quickly the huge money spent on AI will translate into revenue and profits is now a big question for investors. At the same time, it has become important for companies to ensure that new investments do not put pressure on existing businesses.

In the meantime, big tech companies are starting to reap some of the benefits of their huge investments in AI. Google, Amazon, and Microsoft have seen their cloud businesses grow. They are providing computing capacity to organizations for AI use. Among their customers are AI startups OpenAI and Anthropic. As AI usage increases, demand for cloud computing is also increasing. As a result, the three companies are seeing revenue growth from this sector.

The pressure to invest in AI infrastructure is also not small. Due to the huge investment, there has been pressure on the supply system. The prices of various materials have increased. There has been a shortage of memory chips. This has also affected Apple's business.

Despite not investing heavily in the AI ​​race, rising chip prices have put pressure on Apple's product sales and profits, which has also had an impact on the stock market.

In the case of Meta, the picture of revenue from AI is a little different. The company does not have its own cloud business. However, the company is trying to reach customers more specifically by increasing the use of AI in the advertising business. As a result, Meta's total revenue in the second quarter (April-June) increased by 28 percent compared to the same period last year to $ 60.1 billion.

Meta's large investment in AI infrastructure has, however, raised some concerns among investors, with the company's shares falling 8 percent after the release of second-quarter results.

According to analysts, investors are now not just interested in seeing how much money is being spent on AI. They are also interested in seeing how much this huge expenditure can ultimately increase revenue and profits.

Meanwhile, the huge investment is having a direct impact on the companies' cash flow or 'free cash flow'. Last year, the amount of cash on hand of the four companies was $200 billion, which is less than the $237 billion in 2024.

Analysts believe that this situation may deteriorate further in the coming days. Because companies are now focusing more on infrastructure development, thinking about the future rather than profits. As a result, the companies' income margins are under pressure and they are having to take on large amounts of debt.

The report also found that Google is under similar pressure. The company's cloud business generated $11.1 billion more revenue than last year, but its free cash flow, or cash flow after expenses, has been squeezed by a massive investment in AI infrastructure.

Amazon CEO Andy Jascio told investors that building out its AI infrastructure will put pressure on the company's free cash flow for some time, as it builds multiple data centers at once. It can take about two years for a data center to be up and running and generate revenue for customers.

As a result, big tech companies' investments in AI are now facing two realities: on the one hand, revenue from cloud and advertising businesses is growing as AI usage increases, while on the other hand, huge spending on data centers, chips, and power infrastructure is putting pressure on cash.

Saudi Arabia, Russia and five other members of OPEC+ are expected to raise their oil production quotas for September when they meet online Sunday as the Middle East war continues to disrupt global energy supplies.

The enlarged Organisation of the Petroleum Exporting Countries will likely increase production by 188,000 barrels per day, following several months of similar hikes, said Jorge Leon, an analyst at Rystad Energy.

However, the September increase is likely to be the last in the current series of production adjustments, he said.

Between late 2022 and 2023, OPEC+ became concerned that oil prices were falling, and agreed to cut oil production in three separate rounds, reducing total output by nearly six million barrels per day.

But Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, Oman and the United Arab Emirates -- before their exit from the group on May 1 -- then changed their strategy by gradually upping production starting in 2025.

A September increase would complete the unwinding of the second of the three production-cut packages introduced by OPEC+.

However, in reality, many OPEC+ members cannot produce as much oil as their official targets allow due to a "decline in production capacity", so increasing targets has become less meaningful, said Giovanni Staunovo, an analyst at UBS.

The Gulf countries have struggled to increase exports due to the near-paralysis of the Strait of Hormuz orchestrated by Iran during the war in the Middle East -- despite a brief upswing in shipping traffic after a US-Iran memorandum of understanding was signed in June.

And in Russia, whose oil infrastructure has been repeatedly targeted by Ukrainian drone attacks, production is hovering at around nine million barrels per day -- compared with a target of 9.8 million barrels per day.

It remains unclear when the group will actually be able to increase its oil volumes, but some member countries, such as Iraq, have expressed a desire to significantly boost production.

Currently, "the group is undergoing a process in setting maximum sustainable capacity levels for all member states", according to Staunovo.

OPEC+ "faces potentially difficult talks over new production quotas" starting next year following the September increase, according to analysts at DNB Carnegie.

"I don't think cohesion is at risk at this very moment," said Leon, warning, however, that the UAE's withdrawal from the group in May has highlighted a weakness in this area.

Explaining the move, Abu Dhabi said it "serves our national interests and long-term strategic objectives".

The UAE had announced many projects and investments aimed at expanding its ability to pump oil in recent years, making it increasingly difficult to justify staying under strict OPEC+ production limits.

Bangladesh has expressed interest in importing natural gas from Myanmar through a cross-border pipeline to help meet its growing domestic energy demand.

Power, Energy and Mineral Resources Minister Iqbal Hassan Mahmood conveyed the interest during a meeting with Myanmar Ambassador to Bangladesh UKyaw Soe Moe at the Secretariat in the capital today (2 August).

During the meeting, the minister said strengthening energy cooperation with neighbouring countries remains a priority under the government's "Neighbours First" foreign policy.

The Myanmar ambassador welcomed the proposal and suggested exploring LNG supplies alongside the pipeline option, a suggestion the minister welcomed.

The discussion revived a long-standing proposal to build a gas pipeline from Myanmar to Chattogram to supply energy to industrial areas in southeastern Bangladesh.

To advance the proposal, Mahmood suggested holding ministerial-level discussions and said he would invite Myanmar's energy minister to Dhaka. He also expressed his willingness to visit Myanmar if necessary.

The minister also referred to broader regional connectivity initiatives, including the proposed China-Myanmar-Bangladesh economic corridor, during discussions of energy cooperation.

He said a cross-border gas pipeline could complement regional infrastructure development and strengthen long-term trade ties between the two countries.

The Myanmar ambassador suggested holding a meeting of the Bangladesh-Myanmar Joint Technical Committee to assess the feasibility of the proposal.

State Minister Aninda Islam Amit, Energy Secretary Mohammad Saiful Islam, among others, were also present at the meeting.

The initiative comes as Bangladesh looks for additional sources of gas amid ongoing supply challenges. On 28 July, Malaysian Prime Minister Anwar Ibrahim expressed his country's willingness to explore supplying LNG to Bangladesh during a telephone conversation with Prime Minister Tarique Rahman.

While developed and developing nations are building digital economies on gigabit-speed internet, Bangladesh remains held back by sluggish connectivity. Despite expanding 4G networks, 47 percent of the population remains offline. Connection speeds and service quality lag behind rising user numbers. The country ranks 91st out of 103 countries for mobile internet speed and 93rd out of 141 for fixed broadband, according to a World Bank report.

Officials and experts warn this fragile connectivity is throttling economic growth. The shortfall weighs on investment, exports, technology-driven trade, freelancing, startups, education, healthcare and the expansion of digital public services. It also threatens the government’s plan to build a cashless society. Experts argue a comprehensive digital overhaul is now vital to navigate future economic headwinds and maintain global competitiveness.

A World Bank report titled “The Unfinished Digital Revolution: Expanding Internet Access” stresses that high-speed internet is no longer just a communications tool, but a primary driver of productivity, investment, employment and innovation. Yet in Bangladesh, where network coverage spans the entire country, individual adoption remains low. The Bangladesh Bureau of Statistics puts the personal internet usage rate at 58.6 percent — up five percentage points in a year — alongside a mobile phone ownership rate of nearly 89.5 percent.

Using Bangladesh as an example, the World Bank notes that although 4G networks covered 100 percent of the population in 2024, only 53 percent actually used the internet. One in three people stayed offline despite living within range of a signal. High handset prices, costly data packages and low digital literacy drive the disconnect, proving that infrastructure alone does not guarantee inclusion. Identifying and removing these barriers through effective policy remains critical if connectivity is to deliver real economic value.

Highlighting the scale of the divide, World Bank data shows that in 27 countries, including Bangladesh, more than half the population has never sent a text message through a mobile phone.

Sluggish internet speeds are frustrating government efforts to curb cash dependency and build a digital economy. Mobile financial services, online banking, point-of-sale terminals and QR code transactions depend on seamless connectivity. Low speeds cause dropped connections, transaction failures and duplicate charges — friction that steadily erodes confidence among merchants and consumers.

Transitioning to a cashless model without reliable, high-speed infrastructure is unworkable, said Muhit Rahman, managing director of One Bank. He told Bonik Barta: “Whatever digital activity we carry out, reliable internet is essential. If speeds are low, the whole system won’t work properly and people won’t develop confidence.”

The Bangladesh Bank governor echoed those concerns recently, Rahman noted, urging the industry to build alternative technologies capable of processing payments when internet connections fail.

Across low- and lower-middle-income nations like Bangladesh, coverage is expanding far faster than speeds, widening the gap with rapidly growing economies. World Bank data on median download speeds puts the United Arab Emirates atop the mobile rankings at 681 megabits per second (Mbps). Even Vietnam, a lower-middle-income country and Bangladesh’s regional peer, registers at 188 Mbps. Bangladesh, meanwhile, averages just 43 Mbps on mobile and 66 Mbps on fixed broadband. Singapore leads fixed broadband globally at 421 Mbps, with Vietnam, Malaysia and Thailand all outperforming Bangladesh by wide margins.

Network specialist Sumon Ahmed Sabir attributed the weak mobile performance to a seven- or eight-year investment drought in infrastructure. “We have nationwide 4G coverage, but service quality has stagnated,” Sabir told Bonik Barta. “Meanwhile, our neighbours have transitioned to 5G. We remain far behind on mobile internet, while broadband speeds fluctuate wildly across regions. So an economic challenge remains.”

The World Bank said internet adoption tracks national economic development closely. In high-income nations, 94 percent of the population is online, rendering access nearly universal. In low-income countries, that figure drops to 23 percent — leaving fewer than one in four connected.

A persistent rural-urban divide explains why lower-middle-income countries lag in both usage and speed. Infrastructure deficits and lower incomes lead to rural connectivity trailing urban centres across all economies. In rural Bangladesh, erratic connections and slow speeds cut residents off from market prices, agricultural support, digital payments, telehealth and public services.

Zahirul Islam, managing director of Smart Technologies, told Bonik Barta: “High-speed, reliable internet is no longer a luxury — it is foundational infrastructure. Internal operations, ERP systems, cloud-based applications, customer support and digital services all depend on web platforms. The world’s leading software solutions rely on stable internet connectivity. When speeds drop or connections fail, delivery slows and productivity falls.”

Building a tech-driven economy requires Bangladesh to upgrade network speed, stability and international bandwidth quality alongside basic coverage, Islam added.

Across low-income nations, weak connectivity and slow speeds drag on economic growth, foreign investment and international trade. Sluggish mobile networks do more than frustrate users; they choke productivity, job creation and capital flows across every sector, the World Bank noted.

Bangladesh must fundamentally restructure its digital landscape, said Dr M Masrur Reaz, chairman of Policy Exchange Bangladesh. “The global economy is pivoting toward a digital framework powered by high-speed internet, allowing regional competitors to pull ahead,” Reaz told Bonik Barta. “Approximately 12 percent of Bangladesh’s exports depend on digital services. Sluggish internet speed directly handicaps them. Banking and financial services rely just as heavily on stable networks. Advanced economies prioritised this sector; Bangladesh must also engineer its own digital revolution now.”

Lutfunnisa Saudia Khan, president of the International Business Forum of Bangladesh, believes fast and reliable internet has become foundational infrastructure for modern enterprise.

“Nearly every activity worldwide now depends on the internet — global trade relies on it just as heavily as domestic commerce,” Khan told Bonik Barta. “Faster speeds and stronger connectivity would break existing monopolies, lower costs, spur competition and push service providers to raise quality. It would also give businesses a wider range of options. Submarine cables can play a critical role here.”

As the government launches fresh initiatives to attract foreign direct investment, digital infrastructure is taking centre stage. Internet connectivity plays a vital role in drawing both domestic and foreign capital, said Nahian Rahman Rochi, an executive member and head of Business Development at the Bangladesh Investment Development Authority.

Rochi told Bonik Barta. “Work is advancing on a third submarine cable, 5G deployment and Starlink’s satellite internet service. Major international telecoms operators are also showing keen interest in expanding their operations into Bangladesh.”

According to the data published by the central bank, the amount of cash outside the banks was Tk 3,49,374 crore at the end of May this year. The amount of such cash increased further in June and July. The balance of cash outside the banks has now exceeded Tk 3,80,000 crore, Bangladesh Bank sources said.

The prevalence of cash is increasing at a time when the payment system in the country's banking sector is much more modern and technology-based. Customers can transact any amount of money in the bank from home if they want. They can use the bank's apps or mobile financial services (MFS) to make purchases, pay utility bills, and receive almost all types of banking services whenever they want.

While searching for an answer to the question of why cash is growing so rapidly despite the expansion of digital payment infrastructure and networks, the country's large informal sector, cash-based businesses, high inflation, limited financial inclusion, and a crisis of trust in the banking sector come to the fore. In many cases, digital transactions have not been an alternative to cash; rather, they are being used in parallel with cash. As a result, the inability to reduce cash dependence despite the spread of modern payment technologies highlights the structural weaknesses of Bangladesh's financial system.

Economists, bankers and all concerned parties say that if a large portion of cash is outside the banks, it is not added to the effective flow of the financial system. This reduces the ability of banks to collect deposits. The supply of money for loans and investments is reduced. The flow of money to the productive sector is also hampered. At the same time, huge amounts of cash increase the risk of the expansion of the informal economy, tax evasion, undisclosed income and illegal transactions. The transparency and accountability of the economy are also weakened.

Dr. Fahmida Khatun, executive director of the private research organization Center for Policy Dialogue (CPD), believes that it is necessary to investigate why the flow of cash has increased so much. She told Banik Barta, "As a result of the modernization of the payment system, the size of the informal economy is supposed to shrink. But we are not seeing that. Rather, the amount of cash going out of banks is increasing. Deposits in banks are also growing. On the one hand, the increase in the flow of cash out of banks, and on the other hand, the growth in deposits are contradictory. These two trends in the economy are contradictory. Why this is happening, the Ministry of Finance and Bangladesh Bank need to investigate."

Dr. Fahmida Khatun herself is now on the board of directors of Bangladesh Bank. She said, 'The growth of the informal economy means that money is coming from some source. Whether that money is from a legitimate source, whether taxes have been paid against that money, these are the questions that need to be answered. Generally, when distrust of banks, bribery and corruption, and black money violence increase in an economy, the demand for cash increases.'

According to Bangladesh Bank data, a decade and a half ago, in 2011, the amount of cash outside banks in the country was only Tk 58,417 crore. In the following years, the demand for cash continued to increase rapidly. Increasing continuously, the amount of cash outside banks stood at Tk 2,9517 crore in June 2021. A year later, in June 2022, this amount increased to Tk 2,364,488 crore. And in June 2023, the amount of cash in the market stood at Tk 2,919,133 crore. However, although the amount of cash outside banks fluctuated in 2024 and 2025, it did not increase much. In June last year, the amount of cash in the market was Tk 2,964,511 crore. But in just one year, in May this year, this amount increased to Tk 3,493,744 crore. Then, in June, the resignation of the chairman of Islami Bank and the appointment of a new chairman by the central bank spread unrest in the bank. As a result, deposits worth about Tk 25,000 crore were withdrawn from the country's largest bank. As the crisis intensified, the central bank had to lend Tk 13,000 crore.

Officials of the Currency Management Department of Bangladesh Bank said that when the instability arose in Islami Bank, a part of the customers withdrew their deposits from many other banks in the country. Due to this, the amount of cash outside the banks exceeded 3.7 trillion taka in June. Then in July, this figure reached 3.8 trillion taka. However, at the moment, the demand for cash is somewhat stable. The situation may normalize if a new board of directors is formed in Islami Bank.

When asked about this, Mohammad Zahir Hossain, administrator of Islami Bank Bangladesh PLC and executive director of Bangladesh Bank, told Banik Barta, "The daily transaction situation of Islami Bank is now normal. We will repay the money that was lent from the central bank in installments. Many of the customers who had withdrawn money from the bank in panic have returned."

According to Bangladesh Bank data, the growth in deposits in the banking sector this year is better than in the past few years. In the first 11 months of the 2025-26 fiscal year (July-May), deposits in the country's banks increased by Tk 1,63,522 crore. Although earlier, deposits increased by Tk 89,774 crore in the same period of the 2024-25 fiscal year. Accordingly, the growth in deposits in the banking sector is almost double compared to the previous year. At the end of May this year, the balance of deposits deposited by customers in banks was Tk 2,041,692 crore. In this case, the growth in deposits was 11.41 percent.

City Bank Managing Director and CEO Masrur Arefin is blaming high inflation for the large amount of cash flowing out of banks. The top executive, who is also the chairman of the Association of Bankers, Bangladesh (ABB), an organization of bank executives, told Business Daily, "The main reason for the large amount of cash flowing into the market is inflation. As the prices of goods and services increase, it now costs more to buy the same amount of money. This money is changing hands in the retail market and circulating as cash. If inflation drops to 5 percent, the amount of cash outside banks will be reduced by half."

However, Masrur Arefin believes that the infrastructure for digital transactions is still inadequate compared to the demand. He said, 'The spread of QR codes, POS machines, cards and internet banking is very limited compared to millions of shops in the country. The crisis of confidence in the banking sector has also increased cash dependence. The presence of good banks is low in many areas. As a result, people are withdrawing money from weak banks and keeping it at home. So much noise in the media about irregularities or looting in the banking sector has pushed even our mid-level banking brands into a challenge. In this situation, our good banks will either have to expand like "Bikash", or we will need a few more "Bikash" for this huge economy.'

In the last few years, there has been a huge expansion of technology-based payment systems in the country's banking sector. Every month, transactions worth 2.5 lakh crore taka are being made in Mobile Financial Services (MFS) alone. Most banks have launched debit, credit and prepaid cards. And the monthly transaction volume of the banks' mobile apps and internet banking has also reached about 2.5 lakh crore taka. In the last few months, the central bank has taken various steps to popularize 'Bangla QR'. Despite this, the central bank is also concerned about the increasing amount of cash leaving the banks.

In this context, Bangladesh Bank's Executive Director and Spokesperson Arif Hossain Khan told Banik Barta, "We have brought all the merchants in the country under the Bangla QR. All digital payment mediums including RTGS, NPSB, MFS are now more popular and faster than ever before. Despite that, the increase in the amount of cash outside the banks is a concern. In the current situation, whether people are turning away from banks has become a big question. However, we are trying our best to restore good governance, discipline and trust in the banking sector."

However, Arif Hossain Khan also blames high inflation for the increase in the amount of cash outside banks. He said, "The country has been experiencing high inflation since 2022. People are having to spend more money to pay for goods and services. In the last three years, weak banks have been given a huge amount of liquidity support from the central bank. Most of the money provided has been withdrawn by depositors. These are also responsible for the increase in cash outside banks."

Yeakin Polymer has reapplied to the Bangladesh Securities and Exchange Commission (BSEC), through its Managing Director Mohammad Harunor Rashid, seeking approval to transfer 21.50% shares held by three sponsor-directors to FCS Holdings Ltd after securing the required no-objection certificates (NOCs) from the company's lenders.

The fresh application was submitted to the regulator on Tuesday, nearly a year after a similar proposal failed to move forward because the required NOCs relating to the company's defaulted loans had not been obtained.

The share price of the company closed at Tk25.10 on the Dhaka stock exchange yesterday (1 August).

The proposed transaction involves the transfer of 1,58,52,993 shares, equivalent to 21.50% of Yeakin Polymer's total outstanding shares, from three sponsor-directors to FCS Holdings, a real estate and investment company.

The shares to be transferred include 71,07,562 shares held by Chairman Chakladar Rezaunul Alam, 72,69,950 shares owned by Director Kapita Packaging Solutions Ltd, and 14,75,481 shares held by Director Didarul Alam.

Managing Director Mohammad Harunor Rashid, who holds the remaining 8.60% of the sponsor-directors' combined 30.10% stake, is not part of the proposed transfer. He will continue as managing director even after the ownership change, if the transaction receives regulatory approval.

Under the proposed arrangement, FCS Holdings will not pay cash for the shares. Instead, it will assume Yeakin Polymer's outstanding liabilities with Islami Bank Bangladesh PLC, Industrial and Infrastructure Development Finance Company (IIDFC), as well as certain supplier dues currently borne by the sponsor-directors.

Yeakin Polymer currently has outstanding loans of around Tk52 crore with banks and financial institutions. Of the total, around Tk43 crore is owed to Islami Bank and Tk9 crore to IIDFC. The company has already secured NOCs from both lenders, fulfilling the key regulatory requirement that prevented the previous application from proceeding, said Managing Director Mohammad Harunor Rashid to The Business Standard.

If approved by the BSEC, FCS Holdings will become a sponsor shareholder and nominate representatives to Yeakin Polymer's board of directors.

As part of the proposed ownership transition, FCS Holdings plans to undertake a Balancing, Modernisation, Rehabilitation and Expansion (BMRE) programme to modernise the company's operations. It has also committed to resolving all pending compliance issues covering the 2022-2026 period after the share transfer is completed.

FCS Holdings had earlier sought to acquire the same sponsor stake in September last year. However, the BSEC did not proceed with the proposal because the required NOCs from lenders relating to the company's defaulted loans were not submitted.

The latest application comes after that regulatory hurdle has been removed.

Yeakin Polymer has remained under financial stress despite a change in ownership last year.

In June 2024, the current board acquired a 30.52% stake in the company from the previous management led by Quazi Anwarul Haque. However, due to a shortage of working capital and its inability to reschedule bank loans, the company failed to restore normal operations, leaving shareholders waiting for a turnaround.

The ownership transfer process has also witnessed repeated delays over the past few years.

On 12 May 2022, the BSEC approved an earlier transfer of sponsor shares after the company's stock price surged around 140% in January 2022 amid speculation over a possible ownership change. However, the transfer was not completed within the stipulated timeframe.

The commission granted the first extension on 21 December 2023, but the parties again failed to complete the transaction. The company again witnessed a notable rise in its share price during that period.

On 9 June 2024, the BSEC approved another one-month extension to complete the share transfer process.

Yeakin Polymer raised Tk20 crore through an initial public offering (IPO) in 2016 to expand its business. However, its business later declined after the government promoted the use of environmentally friendly jute sacks instead of polymer bags.

Since its listing, the company has declared only a 1% cash dividend on one occasion. In February last year, it was downgraded to the "Z" category on the stock exchanges.

According to the latest shareholding data as of 30 June 2026, sponsor-directors jointly hold 30.10% of the company's shares, of which 21.50% is proposed to be transferred to FCS Holdings, while Managing Director Mohammad Harunor Rashid will retain his 8.60% stake. Institutional investors hold 17% of the shares and general shareholders own the remaining 52.90%.

Yeakin Polymer has reapplied to the Bangladesh Securities and Exchange Commission (BSEC), through its Managing Director Mohammad Harunor Rashid, seeking approval to transfer 21.50% shares held by three sponsor-directors to FCS Holdings Ltd after securing the required no-objection certificates (NOCs) from the company's lenders.

The fresh application was submitted to the regulator on Tuesday, nearly a year after a similar proposal failed to move forward because the required NOCs relating to the company's defaulted loans had not been obtained.

The share price of the company closed at Tk25.10 on the Dhaka stock exchange yesterday.

The proposed transaction involves the transfer of 1,58,52,993 shares, equivalent to 21.50% of Yeakin Polymer's total outstanding shares, from three sponsor-directors to FCS Holdings, a real estate and investment company.

The shares to be transferred include 71,07,562 shares held by Chairman Chakladar Rezaunul Alam, 72,69,950 shares owned by Director Kapita Packaging Solutions Ltd, and 14,75,481 shares held by Director Didarul Alam.

Managing Director Mohammad Harunor Rashid, who holds the remaining 8.60% of the sponsor-directors' combined 30.10% stake, is not part of the proposed transfer. He will continue as managing director even after the ownership change, if the transaction receives regulatory approval.

Under the proposed arrangement, FCS Holdings will not pay cash for the shares. Instead, it will assume Yeakin Polymer's outstanding liabilities with Islami Bank Bangladesh PLC, Industrial and Infrastructure Development Finance Company (IIDFC), as well as certain supplier dues currently borne by the sponsor-directors.

Yeakin Polymer currently has outstanding loans of around Tk52 crore with banks and financial institutions. Of the total, around Tk43 crore is owed to Islami Bank and Tk9 crore to IIDFC. The company has already secured NOCs from both lenders, fulfilling the key regulatory requirement that prevented the previous application from proceeding, said Managing Director Mohammad Harunor Rashid to The Business Standard.

If approved by the BSEC, FCS Holdings will become a sponsor shareholder and nominate representatives to Yeakin Polymer's board of directors.

As part of the proposed ownership transition, FCS Holdings plans to undertake a Balancing, Modernisation, Rehabilitation and Expansion (BMRE) programme to modernise the company's operations. It has also committed to resolving all pending compliance issues covering the 2022-2026 period after the share transfer is completed.

FCS Holdings had earlier sought to acquire the same sponsor stake in September last year. However, the BSEC did not proceed with the proposal because the required NOCs from lenders relating to the company's defaulted loans were not submitted.

The latest application comes after that regulatory hurdle has been removed.

Yeakin Polymer has remained under financial stress despite a change in ownership last year.

In June 2024, the current board acquired a 30.52% stake in the company from the previous management led by Quazi Anwarul Haque. However, due to a shortage of working capital and its inability to reschedule bank loans, the company failed to restore normal operations, leaving shareholders waiting for a turnaround.

The ownership transfer process has also witnessed repeated delays over the past few years.

On 12 May 2022, the BSEC approved an earlier transfer of sponsor shares after the company's stock price surged around 140% in January 2022 amid speculation over a possible ownership change. However, the transfer was not completed within the stipulated timeframe.

The commission granted the first extension on 21 December 2023, but the parties again failed to complete the transaction. The company again witnessed a notable rise in its share price during that period.

On 9 June 2024, the BSEC approved another one-month extension to complete the share transfer process.

Yeakin Polymer raised Tk20 crore through an initial public offering (IPO) in 2016 to expand its business. However, its business later declined after the government promoted the use of environmentally friendly jute sacks instead of polymer bags.

Since its listing, the company has declared only a 1% cash dividend on one occasion. In February last year, it was downgraded to the "Z" category on the stock exchanges.

According to the latest shareholding data as of 30 June 2026, sponsor-directors jointly hold 30.10% of the company's shares, of which 21.50% is proposed to be transferred to FCS Holdings, while Managing Director Mohammad Harunor Rashid will retain his 8.60% stake. Institutional investors hold 17% of the shares and general shareholders own the remaining 52.90%.

China has spent several decades building roads, bridges, tunnel and power plants across Bangladesh. Now, its focus is expanding.

The strongest evidence suggests it has, and the clearest sign is foreign direct investment (FDI).

China became Bangladesh’s second-largest source of net FDI in 2025, accounting for more than 18 percent of total inflows, according to Bangladesh Bank data.

That means nearly one in every five investment dollars entering Bangladesh came from Chinese businesses. Chinese FDI reached a six-year high, while cumulative investment approached $2 billion last year.

In 2025, power attracted the largest share of FDI, receiving $448.18 million, followed by food processing with $410.62 million and textiles and apparel with $360.16 million.

Banking, telecommunications, chemicals and pharmaceuticals, agriculture, leather and information technology also drew substantial investment.

For years, Chinese companies were best known in Bangladesh as engineering, procurement and construction contractors rather than long-term investors. They built landmark projects such as the Padma Bridge Rail Link and the Karnaphuli Tunnel.

Now BB data show their role is changing.

China is increasingly directing capital towards industrial investment, relocating manufacturing and embedding itself more deeply in Bangladesh’s production base.

That change is becoming visible across a series of developments which, taken together, point to a new phase in China-Bangladesh economic relations.

The most significant is the long-awaited start of construction of the China Economic and Industrial Zone (CEIZ) at Anwara in port city Chattogram.

First proposed during President Xi Jinping’s visit to Bangladesh in 2016, the project remained largely dormant for years despite land acquisition and planning. Following Prime Minister Tarique Rahman’s first foreign visit to Beijing in June, it regained momentum.

Designed to attract around $1.3 billion in investment and create more than 1 lakh jobs, CEIZ will be China’s first dedicated industrial zone in Bangladesh. More importantly, it marks a shift from delivering infrastructure to establishing industrial production.

Chinese interest is also expanding outside Chattogram.

During the prime minister’s visit, Dhaka and Beijing signed an agreement to develop the China-Bangladesh Mongla Port Economic Zone in Mongla, an area that had previously featured in India’s industrial cooperation plans.

At the same time, Chinese involvement has widened to include port infrastructure, logistics and industrial development. While many of these projects are still at the planning or memorandum stage, together they suggest China is looking to build industrial ecosystems rather than deliver individual projects.

The timing is no coincidence.

As labour costs rise in China and geopolitical tensions reshape global supply chains, Chinese manufacturers are increasingly relocating labour-intensive production overseas. Vietnam and Cambodia have attracted much of that investment over the past decade.

Bangladesh is now positioning itself as another destination, offering competitive labour costs, preferential access to Western markets and a well-established garment industry.

The energy sector reflects the same trend. Chinese companies continue to pursue opportunities in power generation, renewable energy and liquefied natural gas infrastructure.

Last week, Bangladesh approved in principle the country’s third floating storage and regasification unit (FSRU), which will be built by China at Maheshkhali in Cox’s Bazar.

Chinese investment in textiles, apparel, furniture, plastics, chemicals, batteries and other manufacturing industries also shows this wider regional shift rather than an isolated bilateral development.

Bangladesh’s own investment policy has evolved alongside these global changes.

The Bangladesh Investment Development Authority (Bida) has introduced dedicated engagement mechanisms for Chinese investors. The agency says about 510 Chinese companies now run businesses in Bangladesh across manufacturing, power, textiles, construction and trading.

Mustafizur Rahman, distinguished fellow at local think tank Centre for Policy Dialogue (CPD), said China’s growing investment reflects a convergence of trade ties, industrial familiarity and changing global supply chains.

“China has been Bangladesh’s largest source of imports for years. That has given Chinese businesses a deep understanding of the market,” he said.

Mustafizur said Chinese companies also built confidence through years of involvement in infrastructure, power and construction projects before expanding into manufacturing.

Global supply chain realignment has further strengthened Bangladesh’s position.

“As China moves towards higher-value manufacturing and faces higher US tariffs, labour-intensive industries are relocating overseas,” Mustafizur said.

He said the China Economic and Industrial Zone in Anwara could become a major catalyst for industrialisation by attracting new manufacturers while increasing commercial use of the Karnaphuli Tunnel and Matarbari Port.

“Greater Chinese investment would create jobs, facilitate technology transfer, strengthen foreign exchange earnings and diversify exports,” he said.

Al Mamun Mridha, former secretary general of the Bangladesh China Chamber of Commerce and Industry, said China’s investment story has unfolded in stages.

Chinese firms initially entered Bangladesh as suppliers of affordable industrial machinery, often offering supplier credit unavailable from European or Japanese competitors. They later established operations in export processing zones before expanding into textile machinery, garments, backward linkage industries, power generation and major infrastructure.

The next stage, he said, is manufacturing.

“Chinese companies are now looking beyond construction projects. Many are relocating manufacturing to Bangladesh because of its competitive labour costs, preferential market access and growing domestic market.”

Lee Wai Choong, managing director of Vernon & Oliver Furniture Company Limited, a Chinese mattress manufacturer in the BEPZA Economic Zone in Mirsharai, Chattogram, said Bangladesh offers competitive labour costs, a growing industrial ecosystem and expanding opportunities for labour-intensive production.

As workers gain more skills, he said, the country could gradually attract higher value-added industries including electronics, chemicals, semiconductors and advanced manufacturing.

“BEPZA has set a good example of investor support and responsiveness. If other government agencies could match that level of efficiency, Bangladesh would become much more attractive to foreign investors,” he said.

Nahian Rahman Rochi, executive member of Bida, said the recent increase reflects years of targeted engagement rather than a temporary spike.

“Over the past year, Bida has established a dedicated pipeline and relationship-management mechanism for Chinese investors. We have identified high-potential companies, engaged with them regularly, and worked with relevant agencies to address specific bottlenecks as investors move from initial interest to actual investment,” he said.

The China Economic and Industrial Zone has already received investment proposals worth around $500 million and is expected to become a major platform for export-oriented manufacturing, he said.

Bida also plans to establish its first overseas office in Guangzhou and deepen cooperation with the China Council for the Promotion of International Trade (CCPIT).

“These initiatives will help us build a stronger and more sustainable pipeline of Chinese investment and, crucially, translate investor interest into projects on the ground,” said Nahian.