The DSE Brokers Association of Bangladesh (DBA) has urged Bangladesh Bank to raise the ceiling of its special fund facility for each scheduled bank to Tk 3 billion from the existing Tk 2 billion and extend the facility for another five years until November 30, 2031.

The DBA made the proposal in a formal letter submitted to Bangladesh Bank Governor Mostaqur Rahman, FCMA, on Tuesday. A copy of the letter was also sent to Bangladesh Securities and Exchange Commission (BSEC) Chairman Masud Khan, according to a press release.

The association said the special fund facility introduced by the central bank had played a positive role in enhancing institutional investment capacity, improving market liquidity and stability, and boosting investor confidence.

Currently, each scheduled bank is allowed to form a special fund of up to Tk 2 billion for investment in the capital market. The existing facility is scheduled to expire on November 30 this year.

The DBA said the facility should not be withdrawn amid the prevailing liquidity crunch in the capital market and heightened global uncertainty arising from ongoing tensions in the Middle East.

Instead, the facility should be strengthened to provide further support to the market, it said.

The association proposed raising the fund ceiling for each scheduled bank to Tk 3 billion and extending the facility for five more years, from December 1, 2026 to November 30, 2031.

According to the DBA, extending and enhancing the facility would help increase institutional investment, market liquidity and depth, and investor confidence.

It would also contribute to the long-term and sustainable development of the country's capital market, the association said.

The DBA expressed hope that Bangladesh Bank would take necessary steps to raise the special fund limit to Tk 3 billion and extend the facility until November 30, 2031, considering the current condition of the capital market and the broader economic interests of the country.

The association also reaffirmed its commitment to working in coordination with Bangladesh Bank and other relevant regulatory bodies to implement the government's development initiatives for the capital market and provide necessary support.

Bangladesh Bank (BB) has allowed designated authorised dealer (AD) banks to open and maintain foreign currency (FC) accounts in the names of eligible private sector industrial borrowers to retain proceeds of approved foreign loans.

The central bank issued the instruction today (Wednesday), aiming to facilitate cross-border settlement of payments from approved foreign loans, BSS reports.

According to the circular, private sector industrial enterprises in Bangladesh can avail themselves of medium- and long-term external financing subject to prior approval from the competent authorities.

The AD banks will have to obtain and retain copies of the specific approval of the competent authority for the foreign loan, including approval from the Scrutiny Committee on Foreign Loan or Supplier's Credit of the Invest Bangladesh Authority, where applicable.

For loans approved by Bangladesh Bank or the Standing Committee on Non-Concessional Loan (SCNCL), the banks will also have to retain copies of the relevant approvals.

The balances maintained in such FC accounts can be used for import payments in accordance with the prevailing Import Policy Order and foreign exchange regulations, as well as for bona fide service payments required for implementation of the projects for which the loans were approved.

For service payments, banks will have to obtain approval from the competent authority where applicable and conduct necessary due diligence, including deduction and payment of applicable taxes and VAT.

The circular also allows encashment of foreign currency into Taka from the FC accounts for local procurement, subject to the provisions of the relevant approvals.

The FC accounts may earn interest or profit, subject to the terms and conditions governing the banker-customer relationship.

The AD banks will have to report utilisation of the foreign loan proceeds to the Foreign Exchange Investment Department (FEID) of Bangladesh Bank on a quarterly basis, covering the quarters ending December, March, June and September.

After completion of drawdown and utilisation of the foreign loan proceeds, the FC accounts will have to be closed and Bangladesh Bank's FEID informed accordingly.

However, if the loan agreement requires retention of funds for repayment of the foreign loan, the FC accounts may be maintained until maturity. In such cases, the accounts may be credited with export proceeds, net of import payments, and funds arising from conversion of Taka from legitimate local sources.

The balance maintained for repayment purposes, however, cannot exceed the amount required for the next three installments.

The new provisions will apply to FC accounts opened and operated against foreign loans approved for eligible borrowers by the Invest Bangladesh Authority, Bangladesh Bank and SCNCL, as applicable.

Bangladesh Bank instructed the AD banks to ensure that the proceeds retained in such accounts are used only for the purposes for which the loans were approved and in accordance with prevailing foreign exchange regulations, approval conditions and loan agreements.

The point-to-point inflation rose to 8.34 percent in September 2026 from 8.26 percent in August, according to data released by the Bangladesh Bureau of Statistics (BBS) on Wednesday.

However, the rate was slightly lower than the 8.36 percent recorded in September last year, according to a UNB report.

Food inflation increased to 7.22 percent in September from 7.02 percent in August, while non-food inflation edged down to 9.30 percent from 9.32 percent.

In September 2025, food and non-food inflation stood at 7.64 percent and 8.98 percent respectively.

At the rural level, general inflation rose to 8.38 percent in September from 8.31 percent in August, but remained below the 8.47 percent recorded a year earlier.

Rural food inflation increased to 7.18 percent in September from 7.01 percent in August, while non-food inflation fell slightly to 9.57 percent from 9.59 percent.

In September 2025, rural food and non-food inflation were 7.54 percent and 9.40 percent respectively.

In urban areas, general inflation increased to 8.26 percent in September from 8.20 percent in August, while it was 8.28 percent in September last year.

Urban food inflation rose to 7.25 percent in September from 7.04 percent in August. Non-food inflation, however, declined to 8.94 percent from 8.97 percent.

The corresponding rates in September 2025 were 7.94 percent for food and 8.51 percent for non-food items.

Unitholders of CAPM BDBL Mutual Fund-01 have overwhelmingly approved a proposal to convert the closed-end mutual fund into an open-end fund, according to a disclosure by its trustee.

At a Special General Meeting (SGM) held at RAOWA Convention Hall in Mohakhali DOHS today (7 October), 99.19% of unitholders, based on units held, voted in favour of the conversion.

The conversion now requires approval from the Bangladesh Securities and Exchange Commission (BSEC).
The move follows regulatory changes under the BSEC Mutual Fund Rules, 2025. In June, the securities regulator instructed trustees to comply with provisions requiring eligible closed-end mutual funds to either convert into open-end schemes or proceed with redemption.

Against this backdrop, the trustee called the SGM yesterday, where unitholders were given the option to approve the conversion or proceed with redemption.

The proposal was approved under Rule 63 of the BSEC (Mutual Fund) Rules, 2025, the trustee said.

If approved by the regulator, the fund will shift from a closed-end structure, where units are traded on the stock exchange, to an open-end structure, where investors generally subscribe to or redeem units based on the applicable net asset value (NAV) and fund terms.

The conversion could therefore change how investors buy and sell units of the fund. The effective date and subscription and redemption arrangements will depend on the terms approved by the BSEC.

CAPM BDBL Mutual Fund-01 is managed by CAPM Company Limited and sponsored by Bangladesh Development Bank Limited. Its units are currently traded on the Dhaka Stock Exchange.

The trustee will now complete the regulatory process, with the conversion taking effect only after BSEC approval and compliance with any conditions imposed by the regulator.

Senior officials in India and the United States have indicated long-running efforts to finalise a bilateral trade agreement have stalled, again. Both nations had agreed to a framework for the deal in February which brought down to 18 percent from 50 percent the punitive tariff on most Indian goods imposed in August last year after a previous round of talks collapsed.

In the meantime, the Supreme Court invalidated US President Donald Trump’s use of emergency powers to impose sweeping tariffs globally, leading to a 10 percent baseline rate. But a final deal between two of the world’s biggest economies remains elusive.
WHY HAVE TRADE TALKS HIT A WALL?

Trade talks have reached a “plateau” with little room for manoeuvre, Finance Minister Nirmala Sitharaman said earlier this week, following United States Trade Representative Jamieson Greer’s comment that a deal is not “imminent.” Neither side has detailed reasons for the delay in finalising the deal.

But talks in the past months have met with complications, most recently a new US law that paves the way for up to 100 percent tariffs on Indian goods because of New Delhi’s purchase of Russian oil. Those purchases have not been significantly reduced.

The potentially stiff levy goes against New Delhi’s efforts to secure tariff terms better than peer economies, including Vietnam and China. A deal has also been held back because Washington is yet to complete a Section 301 trade investigation on several nations over alleged excess industrial capacity. The probe is to evaluate whether such overproduction is hurting or undercutting American industries.

Unless this probe is completed, it is hard to tell what final tariff Indian goods will attract. Overall, bilateral ties between India and the US have been rocky this past year, casting a shadow on efforts to stabilise their trade partnership. Events including a US military attack on a ship off Oman that killed three Indian seafarers and India rejecting Trump’s repeated claim of brokering a ceasefire with Pakistan have hurt relations.

WHAT IS AT STAKE?

The US is India’s largest export market and exports have so far been resilient. India’s goods exports to the United States rose to $42.79 billion in April-August from $40.39 billion a year earlier. In the fiscal year 2025/26, India enjoyed a nearly $34 billion trade surplus with the US. India says many of its largest export categories to the US, including generic pharmaceuticals and smartphones, are not subject to the current 10 percent levy. But analysts say that in the absence of a trade deal, India risks higher US tariffs from the ongoing trade probe and purchase of Russian oil, even if it could negotiate for waivers under the sanctions law. Another increase in tariffs could hurt businesses, dent market sentiment and hurt the Indian currency, which is already trading close to record lows.

WHAT MORE DO THE TWO SIDES WANT?

India is striving to protect politically sensitive sectors, particularly agriculture, while securing better tariff treatment for its exporters. India has sought to keep dairy, poultry, rice, wheat and other farm products outside the scope of market-opening commitments. It wants greater certainty over US tariffs before making concessions.

The Trump administration wants India to cut Russian oil purchases, arguing Indian purchases of Russian crude help finance the war in Ukraine. India says decisions on where to source fuel are driven by the energy needs of its 1.4-billion-strong population. Russian crude became particularly important after Moscow’s full-scale invasion of Ukraine because it was available at discounted prices. The war in the Middle East and resulting disruptions have sharpened the calculation over energy imports.

ARE FURTHER TALKS PLANNED?

US Secretary of State Marco Rubio is expected to visit India later this month, when two-way talks could make some progress. Modi and Trump, who spoke by phone on September 30, are also expected to speak again soon to review progress. Modi is expected to visit the US in December for a G20 leaders’ meet.

Listed company Fine Foods Limited has recommended a 40.5% cash dividend for its general shareholders for the fiscal year 2025-26, while its sponsors and directors will receive a 5% cash dividend for the year.

The dividend was recommended at a board meeting held yesterday after reviewing the company's financial results for the year ended 30 June 2026.

Meanwhile, Fine Foods' share price fell 0.44% to Tk471.40 on the Dhaka Stock Exchange (DSE) today (7 October).
Fine Foods has a total of 13,973,918 shares. Of these, general shareholders hold 12,027,102 shares, while sponsors and directors hold 1,946,816 shares.

Under the proposed dividend, general shareholders will receive a total of Tk4.87 crore, while sponsors and directors will receive Tk9.73 lakh.

The record date for the dividend has been set for 12 November 2026.

Alongside the dividend announcement, the company reported significant improvement in its financial performance for FY26.

Fine Foods' turnover rose to Tk26.11 crore in FY26 from Tk11.89 crore a year earlier, representing an increase of around 120%.

The company's earnings per share (EPS) rose sharply to Tk11.81 in fiscal 2025-26 from Tk4.18 a year earlier, marking an increase of around 183%.

Meanwhile, net asset value (NAV) per share increased to Tk25.20 from Tk14.65, while net operating cash flow per share rose to Tk1.90 from Tk1.67.

The board also recommended holding the company's 32nd Annual General Meeting (AGM) at 11:50am on 26 December. The AGM will be held under a hybrid system.

Bangas Limited, a publicly listed biscuit maker, saw its business decline in the 2025-26 fiscal year, as domestic sales fell by around 16% from the previous year despite a strong rise in exports.

The confectionery products manufacturer reported local sales of biscuits and bread at Tk14.57 crore in FY26, down 18.64% year on year from Tk17.91 crore in the previous fiscal year.

Meanwhile, its exports soared 41% to Tk1.17 crore from Tk83 lakh in FY25, according to the auditor's report published on the stock exchanges' website.

As its sales dropped, the biscuits manufacturer witnessed a decline in its profit by 14% in FY26.

Bangas sells Grand Choice, Evening Touch, Lovely, Wonder, Glucose and Lexus biscuits in the local market.

The company reported earnings per share (EPS) of Tk0.24 at the end of June 2026, down from Tk0.28 in the previous fiscal year.

Based on its outstanding shares, its net profit stood at Tk18.26 lakh in FY26, compared with Tk21.34 lakh a year earlier.

Its board of directors approved a 3% cash dividend for general shareholders only, meaning sponsor-directors will not receive any dividend.

General shareholders will receive Tk17.60 lakh in dividends for FY26.

The company reported a net asset value (NAV) per share of Tk21.10, while net operating cash flow per share was negative Tk0.25.

It has scheduled its annual general meeting (AGM) for 12 November through a hybrid platform, while 19 October has been fixed as the record date to determine eligible shareholders.

Bangas Limited, which was listed on the stock exchanges in 1984, produces sweet and salted biscuits and bread under the Bangas brand.

Its shares closed at Tk117.40 each on the Dhaka Stock Exchange (DSE) yesterday, meaning the stock is trading significantly above its NAV per share.

GPH Ispat, a listed steelmaker with liabilities of around Tk 12,000 crore, has asked the Bangladesh Bank to waive or relax Credit Information Bureau (CIB) requirements for four months as it seeks to restructure part of the debt owed to more than two dozen banks and finance companies.

In a letter to the central bank governor on September 24, the company said the bureau’s procedural and regulatory requirements were complicating its efforts to secure banking facilities and complete the proposed loan restructuring on time.
Earlier in June, City Group was given a three-month lifeline until September to restructure its outstanding loans following its request. City Group’s outstanding loans now stand at around Tk 25,000 crore, spread across 48 banks and non-bank financial institutions.

GPH Ispat said the CIB listing was affecting its working capital management and ability to keep operations running without interruption.

The CIB is the central bank’s database of borrowers’ credit histories. Banks consult it before approving new credit, meaning a borrower’s CIB status can directly affect access to fresh financing, including working capital.

The steelmaker has liabilities of around Tk 12,000 crore with more than two dozen banks and finance companies, including United Commercial Bank, Pubali Bank, Mutual Trust Bank, Trust Bank, City Bank, One Bank, Dutch-Bangla Bank, BRAC Bank, Eastern Bank, Modhumoti Bank, Sonali Bank, NRBC Bank, Meghna Bank, Southeast Bank, NCC Bank, Mercantile Bank and Uttara Bank.

The company said it was taking steps to strengthen its finances, improve liquidity management, regularise its dues and keep the business running.

A meeting on the issue was held at the central bank on September 13, led by the governor. It considered restructuring and rescheduling the company’s loans and credit facilities, as well as implementing a coordinated turnaround plan.

A committee headed by the managing director of United Commercial Bank has been formed to resolve the matter. At its meeting in September, the committee decided to prepare a realistic, coordinated plan to restructure the company’s overall liabilities.

Syed Mahbubur Rahman, managing director and CEO of Mutual Trust Bank, told The Daily Star, “We sat down with the BSEC chairman to discuss how the company can be supported.”

“In the country’s current situation, we must come forward to save companies like these,” he said, adding that work was under way. “We are considering giving them loan rescheduling or restructuring facilities, and looking at new working capital.”

GPH Ispat wants the relaxation to complete the ongoing restructuring and rescheduling, finalise documents and approvals with banks and financial institutions, arrange working capital to keep its normal business going, carry out its financial restructuring and deleveraging plan approved by regulators and lenders, and improve cash flow and its ability to repay and regularise its dues.

The company stressed that the request was aimed only at supporting its recovery and business continuity, not at evading or weakening any regulatory requirement. It said it remained committed to transparency with banks and compliance with all applicable laws, prudential rules and the BB directives.

The letter was signed by managing director Mohammad Jahangir Alam, who declined to comment when contacted.

An analysis of GPH Ispat’s financial statements shows that it made a profit of more than Tk 100 crore only twice in the decade since FY2014-15, while repeatedly expanding capacity with bank loans. Its profit margin remained mostly below 5 percent.

According to its audited report, GPH Ispat, which was incorporated in 2006, had long-term loans of Tk 4,718 crore and short-term loans of Tk 2,802 crore at the end of the last fiscal year.

Sales fell by around 30 percent year-on-year to Tk 3,940 crore. Despite the decline, the company posted a profit of Tk 3 crore, compared with a loss of Tk 24 crore in the previous year.

GPH Ispat’s annual production capacity includes 8.4 lakh tonnes of mild steel billets and 6.4 lakh tonnes of MS rods and medium sections.

In its FY25 annual report, the company said the country’s total annual steel production capacity was around 13-15 million tonnes, while effective demand had declined sharply, pushing capacity utilisation down to roughly 30-40 percent.

It described the mismatch between capacity and demand as a major short-term challenge for the sector. The situation did not improve in the last fiscal year.

Bangladesh’s economic growth more than doubled to 4.6 percent in the final quarter of fiscal year 2025-26 (FY26) from 2.05 percent a year earlier, driven by a strong recovery in manufacturing and services, according to the Bangladesh Bureau of Statistics (BBS).

The growth estimate, however, comes against a backdrop of weak private-sector credit, energy supply constraints and financial-sector vulnerabilities, prompting economists to caution against interpreting the rebound as a broad-based acceleration of the economy.

Industrial production grew 6.52 percent in the April-June quarter, compared with just 0.92 percent in the same period a year earlier, the BBS reported in its quarterly estimate of the country’s gross domestic product (GDP).

GDP is a measure of the final value of goods and services produced in an economy over a certain period.

A robust rebound in manufacturing and construction drove the industrial uptick, offsetting the slump in utility supply services, according to the national statistical agency.

Manufacturing was the main driver, with growth surging to 8.66 percent from 3.28 percent a year earlier. It was the highest growth in the sector in six quarters.

The construction sector also returned to positive growth, expanding 1.69 percent in the fourth quarter after contracting 4.47 percent in the same quarter of FY25.

The services sector, which accounts for the largest share of the economy, grew 4.28 percent in April-June, nearly doubling from 2.26 percent a year earlier.

The rebound in industry came despite continued weakness in electricity, gas and water supply services, which contracted 2.41 percent in the fourth quarter following a 3.56 percent decline in the previous quarter.

Agriculture, meanwhile, recorded slower growth of 1.73 percent in the fourth quarter, down from 3.19 percent a year earlier.

INTERPRET CAUTIOUSLY: ECONOMISTS

Abdur Razzaque, chairman of Research and Policy Integration for Development (RAPID), said the strong manufacturing growth warrants careful scrutiny.

“It is not immediately easy to reconcile such strong manufacturing growth with the broader conditions prevailing during the period, including energy supply constraints and the continued weakness of private-sector credit growth,” he said.

While stating that the fourth-quarter GDP figure appears relatively strong, he said that it should be viewed against the unusually weak performance a year earlier.

In the same quarter of FY25, growth was exceptionally weak at just 2.05 percent.

“When economic activity recovered from that unusually low level, the year-on-year growth rate naturally appeared much higher. The latest figure does indicate some recovery, but it should not be interpreted as evidence of a broad-based or particularly strong acceleration in the economy,” he said.

One possible explanation, he said, is that confidence improved, at least temporarily, following the February 2026 election, supporting some recovery in production and investment-related activity.

“If the manufacturing estimate is borne out by subsequent data, that may have contributed meaningfully to the stronger overall GDP number. Even so, the scale of the reported manufacturing rebound remains difficult to fully explain at this stage, and a clearer assessment will require more detailed sectoral and high-frequency data,” Razzaque said.

M Masrur Reaz, chairman and CEO of Policy Exchange Bangladesh, said the quarterly growth could be described as moderately encouraging compared with the average growth recorded over the past two fiscal years.

He, however, added, “It is still far below what Bangladesh needs and what the economy is capable of achieving.”
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The Purchasing Managers’ Index (PMI) also points to an improvement in economic activity during the quarter. The average PMI rose to 56.8 in the fourth quarter from 54.4 in the previous quarter.

Reaz said the manufacturing sector showed some improvement in July, but momentum weakened in August and September.

Meanwhile, Ashikur Rahman, principal economist at the Policy Research Institute of Bangladesh, said fourth-quarter growth typically receives a boost from higher execution of the Annual Development Programme, as the government settles bills and seeks to meet year-end targets.

“But we have to be very cautious that the structural problems hindering our growth are very real, especially those stemming from the banking sector and the energy sector. Without serious commitment to reform, I think the outlook is not very great for growth to enjoy a serious positive turnaround,” he said.

The BBS released the data a day after the World Bank estimated that Bangladesh’s economy grew 3.4 percent in FY26.

The multilateral lender also forecast 3.4 percent growth for the current fiscal year, citing a deepening energy crisis, financial-sector vulnerabilities and global uncertainties.

The World Bank’s forecast would mark a fourth consecutive year of slowing economic expansion.

Countries, both rich and poor, must take faster action to cut debt and counter growing inequality as their economies weather a triple whammy from the artificial intelligence boom, heavy borrowing and shocks from wars in the Middle East and Ukraine, the head of the IMF said Wednesday.

“Some very tough political choices stare us in the face,” IMF Managing Director Kristalina Georgieva said in a speech in Singapore ahead of autumn IMF-World Bank meetings to be held in Bangkok next week.

“My message to the world’s economic policymakers next week will be this: we cannot keep delaying necessary policy action — you have the tools, now have the wisdom to use them,” she said.

At the meetings in Bangkok, finance ministers and central bank governors of 191 IMF-World Bank member countries will assess the state of the world economy and discuss strategies to support financial stability and sustained growth.

So far, the hardest recent hits to global well-being have come from conflicts in the Middle East, Ukraine and elsewhere, Georgieva noted.

But excessive debt is a growing burden for wealthy countries such as the US, Japan and Germany, as well as low-income countries that must choose between spending on public welfare or repaying onerous loans at a time of high interest rates, she noted.

Georgieva pointed to risks associated with the rapid buildup of data center capacity to deliver artificial intelligence, which has helped push stock prices in many places to record highs, supporting strong economic growth despite high energy costs due to the Iran war.

Investments in AI are likely to exceed the relative scale of spending on building railroads, electricity grids and telecommunications networks.

“Love it, hate it or fear it, AI is here, rapidly becoming a key driver of countries’ relative fortunes in the world economy,” she said.

The AI building boom is underpinning robust corporate earnings as well as higher inflation. But there is a lag between the heavy investments involved and the arrival of AI’s benefits, Georgieva said.

“Should earnings fall short,” she said, “hyperscaler leverage and large and growing global holdings of U.S. equities could turn a disappointment into a far-reaching shock.”

Seven of the top 10 countries for AI-related trade are in the Asia-Pacific region, where the share of global economic activity has risen to 43 per cent from 25 per cent in 1991, the last time the meetings were held in Bangkok.

While China, India, Japan, South Korea, Taiwan and other countries with strong tech sectors are benefiting from the AI boom, it is bypassing most others, Georgieva said, adding to economic inequality. AI also is raising energy demand, pushing prices for fuel, fertilizer, food and other key commodities still higher.

She urged countries to rein in public spending and to raise the cost of borrowing as needed to control inflation, while protecting the most vulnerable members of their societies.

Policies are needed to ensure AI is well regulated and to train workers, make labor markets more flexible, facilitate entrepreneurship and improve energy security, Georgieva said.

Bangladesh is yet again set to register weak economic growth of 3.4 percent in the current fiscal year, according to the World Bank, marking a fourth straight year of slowing growth amid a deepening energy crisis, financial sector vulnerabilities and global uncertainties.

The Washington-based lender expects only a slight recovery to 3.9 percent in fiscal year 2027-28, meaning Bangladesh is set to record the weakest growth among its South Asian neighbours in 2027, according to the World Bank’s latest economic update on Bangladesh and South Asia released yesterday.

The forecast is a further downgrade from the multilateral lender’s April estimate. It also marks a sharp break from past years when Bangladesh was seen as one of the region’s fastest-growing economies.

In the report, the World Bank said South Asia is forecast to accelerate from 6.8 percent in 2025 to 6.9 percent in 2026, after it revised up growth projections for most countries from its previous forecast.

According to the lender, higher energy prices have not interrupted the region’s momentum in consumption growth.

“The main exception is Bangladesh, whose forecast has been continually downgraded in recent years,” said the report.

Bangladesh’s gross domestic product (GDP) growth reached 7.1 percent in fiscal 2022 but began slowing the following year. Growth fell below 4 percent in FY25, and the World Bank now expects the weakness to continue until FY28.

The lender said the return of political stability was expected to support a rebound in economic activity. But that recovery has yet to materialise, prompting it to cut the FY27 growth forecast by 1.2 percentage points to 3.4 percent.

“This deterioration reflects a more protracted drag from energy shortages, banking sector weakness, subdued credit growth, and tighter fiscal constraints than previously anticipated. Export growth is expected to remain weak,” said the global lender.

The slowdown is particularly evident in industry. Industrial output grew by just 2 percent in FY2025-26, while the industrial sector contracted in the third quarter for the first time since the pandemic.

Private investment has also been held back by uncertainty over energy supplies and vulnerabilities in the banking sector.

Private sector credit growth fell to a 33-year low of 4.5 percent in June 2026, reflecting weak business confidence, banking sector vulnerabilities and disruptions to energy supplies.

Government investment has also fallen to a historic low amid acute fiscal constraints and implementation challenges, weighing on domestic demand in the short term and the economy’s longer-term growth potential, the report said.

The World Bank said the slowdown reflected deeper structural weaknesses that were affecting investment, employment and productivity.

“Longstanding vulnerabilities in the financial sector, chronic weaknesses in domestic revenue mobilisation, persistent energy sector bottlenecks, and declining public investment have reduced the economy’s resilience and constrained its growth potential,” said the World Bank.

ENERGY CRISIS

The energy shortage has become a major constraint on factories and businesses.

Domestic gas production has declined, while imported liquefied natural gas now meets about a third of gas demand. Failures at floating LNG import terminals in Maheshkhali reduced supplies, forcing many factories to operate below capacity or suspend production.

The gas shortages also contributed to widespread load-shedding. The government ordered shopping malls to close early to reduce peak electricity demand, while petroleum import bills more than doubled in FY2025-26.

The World Bank noted that the outlook remains vulnerable to further shocks.

“The outlook is subject to significant downside risks,” it said in its latest Bangladesh Development Update.

Banking sector vulnerabilities, it said, have intensified and pose growing systemic risks.

HIGH INFLATION

Inflation has eased from its peak but remains well above the Bangladesh Bank’s target.

Average headline inflation fell from 10 percent in FY25 to 8.7 percent in FY26 and eased further to 8.3 percent in August this year, mainly because of lower food inflation.

The World Bank expects inflation to average 8.6 percent in FY27, citing higher domestic energy prices, supply constraints and continued money supply growth.

Underlying price pressures remain elevated. Despite persistent inflationary pressures, the Bangladesh Bank reduced its policy rate for the first time in six years in July 2026 and introduced targeted liquidity support for industry.

Higher public sector credit growth and stronger foreign asset inflows also supported a recovery in broad money (M2) growth.

Real wages for low-paid workers are still falling, the World Bank said.

JOBS, EXPORTS UNDER PRESSURE

The weak economy has also hit the labour market. Conditions deteriorated further in FY26 as subdued demand and energy shortages constrained hiring, especially in industry.

Factories closed, laid off workers and reduced operating hours, while weaker industrial activity spilled over into the services and agriculture sectors.

Female labour force participation fell from 42.8 percent in 2022 to 38.4 percent in 2024, as women who lost jobs in industry and services largely left the labour force.

Exports also remain a weak point.

The World Bank said ready-made garment exports would be constrained in the short term by weak demand in the European Union and, over the longer term, by greater competition for market share.

Overall exports fell 0.2 percent in FY2025-26. A survey by the United States Fashion Industry Association, cited by the World Bank, showed that US buyers’ use of Bangladesh as a sourcing base had fallen to around 78 percent from 88 percent a year earlier.

The World Bank expects the current account deficit to widen to 0.9 percent of GDP in FY27.

Remittances, however, provided some support to the external sector.

They rose 17.3 percent in FY2025-26 to a record $35.6 billion, limiting the current account deficit to 0.3 percent of GDP and helping rebuild foreign exchange reserves to more than $32 billion by August. The taka was broadly stable.

AI OFFERS OPPORTUNITY

The World Bank’s broader South Asia outlook sees the region’s growth accelerating from 6.8 percent in 2025 to 6.9 percent in 2026, with higher energy prices yet to interrupt momentum in consumption growth.

The report also examines how artificial intelligence could create new sources of growth across the region.

AI adoption in South Asia is rising but remains well behind advanced economies.

Even so, firms are increasingly using the technology to find new markets, while governments are deploying it in areas such as weather forecasting for smallholder farmers in India and AI-assisted retinal screening in Bangladesh.

“The adoption of AI has the potential to transform South Asia’s development trajectory by boosting labour productivity, expanding export opportunities, and improving public service delivery,” said Franziska Ohnsorge, World Bank Group chief economist for Asia.

“But to reap these benefits, governments need to address the foundational gaps that hold back adoption,” she added.

Johannes Zutt, World Bank vice president for South Asia, said the region needs to develop new sources of growth to maintain momentum and create jobs.

“South Asia has demonstrated remarkable resilience in a challenging global environment. But the region needs to invest in new drivers of growth to sustain momentum and create more jobs,” he said.

Johannes added, “To seize the opportunity provided by rapidly-growing AI global value chains, countries should invest in the skills, infrastructure, and enabling environment that allow workers and businesses to harness AI’s potential.”

Sharp spikes in food and energy prices will likely become more common, the International Monetary Fund said, warning such crises drive inflation expectations higher for longer, worsen poverty and threaten economic stability.

IMF research released on Tuesday examined three decades of strategies used by governments to mitigate price surges, as well as a new economic model that accounts for the higher inflation experienced by poorer households, which spend a higher share of their budgets on daily necessities.

Large surges in prices of everyday necessities have been infrequent historically, especially at the global level, but they have been a recurring source of economic and social stress over the past five years following Russia’s invasion of Ukraine in 2022 and this year’s war in West Asia.

The new model showed a gap of 0.8 percentage point to the standard inflation measure, suggesting that 23 million more people fell below the extreme poverty line from 2021 to 2024 than previously calculated.

“In a nutshell, cost-of-living crises ... impact price stability, they reduce living standards and they worsen inequality,” said Chiara Maggi, the IMF economist who co-led the research published as Chapter 2 of the forthcoming World Economic Outlook, which will be released next week.

The IMF said last month that the global economy had weathered the energy shock caused by the war in West Asia better than feared and global economic output was still expected to expand by about 3 percent in 2026, but it cautioned that risks remained high.

That would match the IMF’s July forecast for 3.0 percent global growth, but falls short of average 3.5 percent growth in 2024 and 2025. The July forecast also assumed the war would wind down in mid-July, but Iran and the United States have both escalated their attacks in recent months, and the war has spilt over into neighbouring countries.

Inflation Expectations

The IMF said its data also showed that near- and medium-term inflation expectations increased significantly during cost-of-living crises, and they remained significantly above their pre-crisis level even three years after the onset of a crisis.

Five-year-ahead inflation expectations increased modestly initially, but remained elevated even three years after a crisis, which in turn could result in interest rate increases.

Targeted transfers were the best way for countries to protect the most vulnerable while preserving price signals, the IMF said. Actions aimed at suppressing prices, including price controls and lower consumption taxes, could cost governments three to six times more money to implement, while producer subsidies could cost 22 times as much to roll out.

Broad measures could also become less effective if many countries implemented subsidies at the same time, the IMF said. Producer subsidies, often favoured by developing countries, were particularly inefficient because they could lower costs for goods that were then exported, leaving domestic taxpayers to essentially subsidise consumers abroad, Maggi said.

Shantayanan Devarajan, a Georgetown University professor and former World Bank economist, said developing countries faced a serious crisis given the combined impact of higher oil prices, high debt levels, increased borrowing costs and the expected impact of this year’s super El Niño weather pattern.

“This is coming at a time when overall growth in low-income countries was at an all-time low,” he said in a videotaped discussion with Maggi that was also released on Tuesday. “Growth has slowed down tremendously.”

Some countries, including Egypt and Indonesia, had begun to shift away from broad subsidies toward targeted cash transfers, Devarajan said, urging countries to implement reforms aimed at boosting growth and limiting damage from the West Asia war.

“You know, they say, ‘Fix your roof when the sun is shining,’” he said. “When the crisis hits, it’s almost too late to introduce any of these measures, and the resistance is going to be huge.”

Four years ago, the United States warned that China was poised to unleash a trade superweapon: a state-backed digital dragnet that would rapidly expand across the globe and give Beijing unprecedented insight into the flow of international cargo. The LOGINK platform promised to streamline global shipping by providing a digital system to exchange logistics data from customs authorities, ports and third-party transport services, replacing paper processes.

Instead, the venture suffered a stunning reversal, reported here for the first time. Its flagship global partnerships have stalled, it dropped out of an international maritime association, and it has become mired in domestic lawsuits over unpaid bills, according to interviews with more than 20 shipping industry insiders and officials, as well as a Reuters review of legal filings.

When a reporter visited LOGINK’s operations hub in the coastal city of Wenzhou in September, the offices appeared abandoned: lights off, reception bare, computer cabling stripped out. Calls and emails to LOGINK went unanswered. China’s transport ministry declined to answer questions. The ministry in June, however, issued a policy document calling for the system to be connected to more domestic data streams.

LOGINK's international retreat is a setback for Beijing, which has been engaged in a battle with Washington to control the physical infrastructure and technologies underpinning global shipping, a sector that carries 80 percent of world trade. The platform's decline will be welcomed by the US, which contributed to LOGINK's reversal in fortunes by "naming and shaming" those who used the system, said Randall Schriver, chair of a US Congress commission that issued a report on LOGINK in 2022.

Reuters could not establish why the platform championed by China’s cabinet as a “key project” abruptly went dark and spiraled into financial and legal troubles. The timing of its retreat, however, coincided with US efforts to pressure allies and organizations that had made tentative steps to collaborate with LOGINK as it pushed for global expansion.

US officials and security experts worried that Beijing could use the system to gather non-public information on traded goods, volumes and pricing to help Chinese firms undercut Western rivals. Some also feared that LOGINK could be used to track sensitive military shipments, including US arms deliveries to Ukraine and Taiwan, many of which move through commercial freight networks. LOGINK has not publicly disclosed the exact nature and scale of the data it collected.

In a submission to the US Trade Representative’s Office in 2024, LOGINK official Li Zhao said that it lacked “the capacity to collect sensitive commercial information or to continuously monitor global cargo movements.” A US State Department spokesperson did not provide specifics when asked about its diplomatic efforts to curb global use of LOGINK, but said that Washington would not allow a platform controlled by Beijing to “gain a chokehold over global maritime data.”

“We have prohibited its use across our own government and critical port infrastructure, and we urge allies and industry to take this threat with the same seriousness,” the spokesperson added.

LOGINK is formally known as the National Transportation and Logistics Public Information Platform. It started two decades ago as a local government project in China’s Zhejiang province to improve coordination of cargo movements by bringing data from ports, trucks and vendors into a single searchable platform. The platform won the backing of policymakers in Beijing, who soon after transferred control of LOGINK to China’s transport ministry. International expansion quickly became a priority.

In 2010, China struck a cargo data-sharing deal with the Japanese and South Korean governments that linked LOGINK to their national logistics information platforms. A few years later, LOGINK signed an agreement with a Hong Kong-based logistics platform that the Chinese entity said in a press release would give it access to “more than 90 percent of global ship tracking data.” LOGINK will be a “one-stop portal connected with global logistics information systems,” according to a 2015 Chinese transport ministry presentation to a United Nations commission which was posted online.

By the late 2010s, LOGINK was also exploring ways to collaborate with European ports. But in 2022, US policymakers started publicly pushing back on the Chinese platform. A turning point came that April, when LOGINK signed up to an international data-sharing project linking operators of digital platforms that facilitate the exchange of cargo and customs information at ports. LOGINK’s participation in that project would double its cooperation with international ports, according to the US commission’s report. A few months later, a group of Republican lawmakers urged then-US president Joe Biden in an open letter to act against LOGINK. Among them was Marco Rubio, now Trump’s Secretary of State. Unchecked expansion of LOGINK could allow the Chinese Communist Party “to gain a stranglehold on the arteries of global trade,” they said.

One of the lawmakers, then-Representative Michelle Steel, in late 2023 also asked the International Port Community Systems Association (IPCSA), which spearheaded the data-sharing project, to immediately cut its ties with LOGINK. Congress at around that time additionally passed a law prohibiting the Pentagon from entering into contracts with LOGINK-connected entities.

The law also directed officials to dissuade allies and partners from using the platform. Officials in Seoul and Tokyo who collaborated with LOGINK, however, told Reuters that the scope of data-sharing was more limited than some in Washington feared. South Korea’s Ministry of Oceans and Fisheries and Japan’s transport ministry said that only vessel arrival and departure times and information on cargo loading and unloading were made available, not details on cargo contents.

Then, LOGINK beat a retreat. The platform’s participation in IPCSA ended in 2024 after it stopped paying its membership dues, according to a person familiar with the matter. LOGINK’s website went dark around that time. The latest available scrape on the Wayback Machine archive dates to June 2024. IPCSA General Manager Inga Morton confirmed that LOGINK was no longer a member and said that the international data-sharing project was “on hold and inactive”. Meanwhile, China's service with South Korea and Japan that was LOGINK’s flagship international initiative has also faltered.

Participants from the three countries have held regular meetings since the service’s launch, but China abruptly canceled an event scheduled for March 2024, citing “internal circumstances,” according to South Korea's oceans ministry. No meetings have been held since. Tokyo’s access to LOGINK data via that service later stopped without notice, a transport ministry official said. The official told Reuters in August that Japan had lost access more than a year earlier and that Tokyo had been unable to contact Chinese counterparts.

The Chinese venture also had little to show for its efforts to expand into Europe. Ana Rita Rosa, a spokesperson for the authority governing Sines, Portugal’s largest port, told Reuters that a memorandum of understanding it had signed with LOGINK in 2017 to explore data-sharing led to no significant outcomes. And Portbase, the digital system that underpins Europe’s largest port of Rotterdam, said that a 2019 MOU with LOGINK did not progress beyond exploratory discussions.

A person familiar with the matter said Dutch government queries about the relationship in early 2022 contributed to Portbase's decision not to pursue any collaboration with the Chinese platform. Rosa and Portbase declined to comment when asked if US diplomatic pressure had any impact on their decisions not to pursue collaboration with LOGINK. The Dutch foreign ministry also declined to comment.

Back in China, LOGINK has faced legal claims. The commercial entity behind the platform’s Wenzhou hub has since January 2024 faced at least 39 court claims that total some $1.3 million, according to filings on Qichacha, a corporate data provider. Some of the complaints were listed as labor disputes, while others appeared to involve unpaid utilities. Among the claimants is a local subsidiary of China Mobile, which sued LOGINK in October 2025 over a "contract dispute over service provision.” A court subsequently ordered LOGINK to pay the telco, but the filings do not show if that occurred.

LOGINK also appears to be facing eviction. A judge in May presided over a "property lease dispute" brought against the company by the state-backed developer running the industrial park where LOGINK is based, the records show. China Mobile and the developer did not respond to requests for comment. When Reuters visited the Wenzhou building, by a river on the outskirts of the city, there was no sign of activity. Emblazoned on the wall next to desks and chairs gathering dust, however, was a large Communist Party slogan heralding China’s plans to “leverage global supply chains” by 2035.

A cyber-disruption triggered by a sanctioned Russian technology vendor has severely crippled Bangladesh's digital payment infrastructure, halting card management systems and interbank transactions for millions of users since Sunday night.

The crisis stems from a row over a software migration between local payment processor Information Technology Consultants Ltd (ITCL), operator of the Q-Cash network, and Russian vendor Compass Plus.

According to the ITCL, the Russian firm installed a disruptive script on ITCL's servers after learning that it was being replaced by WAY4, an enterprise payment platform developed by Brussels-based OpenWay.
The rogue script automatically restarts ITCL's servers every eight hours, wiping out routing tables and shutting down processing capacity across the network.

"When we identified the issue, we immediately alerted bKash and all our partner banks," Kazi Saifuddin Munir, Managing Director and CEO of ITCL, told The Business Standard yesterday (6 October).

He said customer data remains secure, adding, "After Bangladesh Bank's intervention, we expect services to resume by 10pm Tuesday [yesterday]."

The dispute escalated after the ITCL notified Compass Plus in August of its intention to phase out their platform over a 12-to-18-month transition period. In response, Compass Plus allegedly threatened to cut off technical support and demanded an immediate $1.5 million migration fee, alongside advance payment guarantees backed by Bangladesh Bank.

Central bank reaction

The central bank intervened on Monday, attempting to resolve the standoff through discussion involving the vendor and the ITCL. However, BB officials expressed displeasure with ITCL's decision to shut down systems without prior notice.
Cenbank summons Q-Cash operator over disrupted services

"This is clearly a technical issue, but the failure to manage it instantly is causing immense suffering to cardholders," said Arief Hossain Khan, executive director and spokesperson for Bangladesh Bank.

Arief confirmed that the central bank will issue formal show-cause notices to affected member banks for abruptly suspending services. Central bank directives strictly require institutions to notify the public well in advance through national media, television, and direct text messages prior to any planned maintenance.

According to Bangladesh Bank's Payment Systems Department, ITCL was originally scheduled to execute its system migration towards the end of October.

"On Sunday evening, ITCL suddenly informed us that they had to take the service offline immediately," a central bank official stated. "While they claimed emergency circumstances forced their hand, taking critical payment infrastructure offline without advance notice violates the regulatory framework."

Severe industry and consumer impact

ITCL provides primary payment processing and gateway infrastructure to 33 commercial banks in Bangladesh, managing core capabilities for National Payment Switch Bangladesh (NPSB), ATMs, Point of Sale (POS) terminals, Cash Recycling Machines (CRMs), and Internet Banking Fund Transfers (IBFT).

Industry estimates indicate that ITCL powers approximately 70% of the country's banking-card transactions.

According to a notice on ITCL's website, the maintenance period was logged from 9pm on Sunday (4 October) to 12pm on 10 October. The sudden outage left millions of retail consumers stranded at restaurants, merchant outlets, and ATMs nationwide, unable to execute basic transactions or check account balances via mobile apps.

Member banks have voiced strong frustration over the reputational damage caused by the abrupt shutdown.

"ITCL informed us on Sunday evening, the very day they pulled the plug. We weren't even given a single day to notify our customers," said Mahfuzur Rahman, chief financial officer of Trust Bank. "It was an utterly unprofessional move that destroyed customer trust across all member banks."

Mahfuzur noted that while Trust Bank's debit cards remain functional on international Visa and local NPSB networks, its credit cards, prepaid cards, and Q-Cash ATM network remain entirely deadlocked.

The securities regulator has urged investors to review a mutual fund's net asset value (NAV) and other key fundamentals before investing, warning that buying overpriced units could expose them to potential losses.

The Bangladesh Securities and Exchange Commission (BSEC) raised the alarm on Monday after observing that units of some mutual funds were being traded in the stock market at prices substantially higher than their respective NAVs.

Investors have shown heightened interest in several mutual funds, driving up unit prices in the secondary market. This has widened the gap between the market value of the units and the underlying asset value.

Investors should not base their decisions on the rise in the market value of mutual funds, said BSEC executive director and spokesperson Md Abul Kalam.

"Investors should not be influenced by rumours, information circulated through social media, or inducements and recommendations from individuals or groups," he added.

If a fund is liquidated, investors will receive value based on NAV, not market price.

Among the funds that triggered the regulatory response, Prime Finance First Mutual Fund reported a NAV of Tk 9 per unit based on the market price of its underlying assets as of Monday, and Tk 15 per unit based on cost price, against a face value of Tk 10. However, the fund's units closed at Tk 32.20 on Monday, more than three times its NAV.

The unit price of Prime Finance First Mutual Fund jumped 52 per cent in just one month, between September 6 and October 5, even though the fund had skipped dividends for two consecutive fiscal years amid net losses.

The Dhaka Stock Exchange (DSE) recently served a notice on the fund's asset manager, ICB Asset Management, seeking an explanation for the unusual rise in the price and trading volume. ICB Asset Management replied that no undisclosed price-sensitive information was behind the rally or the high trading volume.

Floated in 2009, Prime Finance First Mutual Fund will mature in March 2029, as it received a 10-year extension in 2018.

Phoenix Finance 1st Mutual Fund presents a similar case. It closed at Tk 17.50 per unit on Monday against a reported NAV of Tk 8.49 per unit based on the current market price of its assets, meaning the market price was more than double the NAV.

The fund's trustee recommended no dividend for FY26, marking the third consecutive year without a payout following net losses in FY24 and FY25. Listed in March 2010, the fund also received a 10-year extension and is scheduled to mature in 2030.

The BSEC said a mutual fund is a regulated investment vehicle in which money collected from investors is invested in various financial instruments and other eligible assets in line with the fund's investment policy.

The market value of those assets determines the fund's total asset value, while NAV is calculated by deducting the fund's liabilities from its assets. NAV per unit is then determined by dividing the fund's net assets by the total number of units outstanding.

"An unusual and significant gap between the market price of a mutual fund unit and its underlying net asset value is a matter requiring special caution in making investment decisions," the BSEC said in a statement.

The commission advised investors to verify the latest published NAV per unit of the relevant fund and examine other pertinent information before making investment decisions. It further advised them to assess a fund's underlying asset value and overall financial condition, remaining tenure, investment pattern and portfolio composition, along with other publicly disclosed information, before investing.

While some mutual funds appear overpriced compared to NAV, most of the 35 listed mutual funds are trading below their respective NAVs on the prime bourse.

The Bangladesh Securities and Exchange Commission (BSEC) has decided to speed up stock market surveillance by allowing its concerned units to investigate abnormal transactions and price movements without prior approval from the commission.
The concerned units would be able to take necessary action once they identify unusual transactions or price fluctuations, BSEC Chairman Masud Khan said yesterday, while speaking as the chief guest at a seminar organised to mark World Investor Week 2026.

The Bangladesh Association of Publicly Listed Companies (BAPLC) and the Bangladesh Merchant Bankers Association (BMBA) jointly organised the event at the Dhaka Stock Exchange (DSE) auditorium.

Masud said requiring approval from the commission through a meeting before initiating an investigation or inspection often causes delays in surveillance.

“That is why this decision has been taken,” he said.

He also said the number of companies listed on the capital market is expected to increase, making it impossible to monitor the entire market through manpower alone.

The commission will therefore establish a technology-driven surveillance system, he said.

Also Speaking at the event, Dhaka Stock Exchange (DSE) Chairman Mominul Islam said stricter surveillance was needed to prevent manipulation of small-cap and weak-fundamental companies.

He said stricter trading restrictions could be imposed on small-cap and weak-fundamental shares by placing them in separate categories.

This would give investors advance warning if unusual price movements occurred in a share, he added.

Mominul also identified the absence of registered financial analysts as a major weakness in the market.

Professional analysis on whether a company’s shares should be bought, sold or held would help investors make more informed decisions, he said.

It could also make it harder for manipulators to create confusion in the market, he added.

He said stock exchanges and the BSEC had traditionally focused their surveillance on brokers, investors and issuers involved in trading.

“The scope of that surveillance needs to be expanded further,” he said.

In addition to using artificial intelligence to detect manipulation and fraud, initiatives should be taken to identify people using AI to commit fraud through digital platforms and bring them under the law, Mominul said.

Prof Al-Amin, acting dean of the Faculty of Business Studies at Dhaka University, said “pump-and-dump” schemes were one of the major problems in the stock market.

In such schemes, the price of a share is artificially inflated rapidly to create investor interest before manipulators sell large volumes of shares and exit, he said.

If such manipulation is not detected and addressed quickly, it can harm the market, he said.

Institutional investors can also be drawn into such schemes, after which retail investors may suffer losses when large investors exit, Al-Amin said. Such manipulation can both erode investors’ capital and create liquidity problems in the market.

The professor also said in cases of unusual price surges, it is not difficult to identify who is buying the shares.

“Analysing transaction data makes it possible to understand who is buying the shares and how trading is taking place,” he said, adding that effective intervention and strong resolve from the regulator were essential.

Middle East crude exports recently climbed to their highest levels since the start of the Iran war as more Gulf producers resume transit through the Strait of Hormuz – despite the continued threat of Iranian attacks.

Yet oil prices remain stubbornly elevated, suggesting logistical problems are proving as disruptive as outright supply losses.
Crude flows through the embattled waterway reached 14.2 million barrels per day on a seven-day average on Sept. 26, nearly 80 percent of pre-war levels, according to analytics firm Kpler.

While volumes have declined since, they will likely be revised higher because ships often disable satellite tracking systems while traversing the strait and for several days thereafter.

Either way, the trend is clear: a lot more crude is getting through the strait.

So why is Brent still trading above $100 per barrel? In a word, logistics.

For decades, the global oil industry functioned as a finely tuned system designed to move enormous volumes of crude and fuels over long distances at the lowest possible cost.

The conflicts in the Middle East and Eastern Europe have fractured that model, as a combination of record-high tanker rates, soaring insurance costs and a severe shortage of refining capacity has created bottlenecks across the energy supply chain.

Those problems may take months, if not years, to unwind, leaving consumers facing persistently high energy bills – even if the crude supply squeeze continues to ease.

Iran’s blockade of the Strait of Hormuz following the onset of the war with the US and Israel on February 28 rapidly reshaped global oil flows.

Gulf producers diverted supplies through alternative routes, buyers sought barrels from more distant regions and governments released unprecedented volumes of oil from strategic reserves.

One of the biggest changes was that Saudi Arabia – previously the world’s largest oil exporter – diverted its exports through its East-West pipeline, which delivers crude to the Red Sea port of Yanbu.

At one point this year, 4 percent of global oil supplies were via this route.

However, after the pipeline came under attack by Iranian-backed Iraqi militias in early September, Saudi Arabia was forced to redirect exports back to the Gulf via Hormuz, which it discovered, could be more easily transited than previously thought.

Saudi exports through Hormuz averaged 3 million bpd in September, the highest level during the conflict, according to Kpler.

While Saudi Arabia’s crude exports through Hormuz in September were still only around half of pre-war volumes, the Kingdom’s exports could quickly near pre-war levels as the East-West pipeline gradually returns to normal operations.

Ironically, then, the attack on the East-West pipeline, which was intended to cripple Riyadh, may have instead weakened Tehran’s most powerful leverage – its purported control of the Strait – by demonstrating that large volumes can still transit Hormuz and other major export hubs despite continued attacks.

Yet the recovery remains fragile.

On the one hand, the increase in Gulf exports has helped reduce the global oil deficit.

Energy Aspects estimates the market now faces a shortfall of around 1.6 million bpd, down from roughly 4 million bpd during the peak disruption in May.

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Under normal circumstances, such an improvement in supply would exert significant downward pressure on prices.

Instead, Brent remains above $100 a barrel, more than 40 percent above pre-war levels.

Prices certainly reflect a substantial risk premium linked to the possibility of renewed escalation, as Washington and Tehran have still failed to reach any form of understanding over the future of Hormuz.

But geopolitics is only part of the story.

Freight and insurance costs, once a relatively minor component of the delivered price of oil, have become major price drivers.

This is partly due to the current shuttle system operating around the Gulf.

Multiple tankers are frequently required to transport crude though Hormuz to the Gulf of Oman, where cargoes are transferred to smaller vessels before heading to buyers in Asia.

This ties up significant numbers of very large crude carriers, reducing vessel availability elsewhere.

At the same time, buyers are increasingly sourcing crude from the Atlantic Basin and shipping it to Asia over longer routes, further tightening tanker supply.

The result has been a surge in key tanker rates to record highs.

Rates to transport crude from the Middle East to Asia aboard a very large crude carrier recently exceeded $1.2 million per day, up from roughly $30,000 a day in January, according to shipping broker Poten & Partners.

As a result, freight costs that once accounted for around 3 percent of the delivered price of a barrel now represent roughly 27 percent.

These costs are unlikely to normalise until trade flows return to something resembling their pre-war pattern.

Indeed, a further recovery in exports through Hormuz may initially worsen the situation by increasing demand for the elaborate shuttle networks now required to move crude safely through the region.

The loss of refining capacity in the Middle East and Russia, where Ukrainian drone attacks have crippled dozens of plants, has compounded the problem, particularly for diesel.

Diesel prices have surged to record highs, becoming a major political concern for U.S. President Donald Trump ahead of next month’s midterm elections, as diesel powers much of modern industry, agriculture and manufacturing.

The Group of Seven’s decision last week to release diesel from strategic stocks will likely provide only temporary relief as it does nothing to restore lost refining capacity.

What’s more, refiners are increasingly competing for the medium-sour crude grades that generate higher diesel yields.

Those barrels are concentrated in the Middle East and Russia, precisely the regions where supply disruptions remain most severe.

That dynamic is creating a feedback loop.

Tight refining capacity boosts diesel prices, which increases demand for diesel-rich crude grades, which in turn supports crude prices.

The result is that oil prices are no longer primarily a function of supply, but of the industry’s ability to transport and process crude – making it much more challenging to bring these prices down.

Senior officials in India and the United States have indicated long-running efforts to finalise a bilateral trade agreement have stalled, again.

Both nations had agreed to a framework for the deal in February which brought down to 18% from 50% the punitive tariff on ​most Indian goods imposed in August last year after a previous round of talks collapsed.

In the meantime, the Supreme Court invalidated US President ‌Donald Trump's use of emergency powers to impose sweeping tariffs globally, leading to a 10% baseline rate. But a final deal between two of the world's biggest economies remains elusive.

Why have trade talks trade talks hit a wall?

Trade talks have reached a "plateau" with little room for manoeuvre, Finance Minister Nirmala Sitharaman said earlier this week, following United States Trade Representative Jamieson Greer's comment ​that a deal is not "imminent."

Neither side has detailed reasons for the delay in finalising the deal.

But talks in the past months have met with ​complications, most recently a new US law that paves the way for up to 100% tariffs on Indian goods because of ⁠New Delhi's purchase of Russian oil. Those purchases have not been significantly reduced.

The potentially stiff levy goes against New Delhi's efforts to secure tariff terms better ​than peer economies, including Vietnam and China.

A deal has also been held back because Washington is yet to complete a Section 301 trade investigation on several nations ​over alleged excess industrial capacity. The probe is to evaluate whether such overproduction is hurting or undercutting American industries.

Unless this probe is completed, it is hard to tell what final tariff Indian goods will attract.

Overall, bilateral ties between India and the US have been rocky this past year, casting a shadow on efforts to stabilisetheir trade partnership.

Events including a US military ​attack on a ship off Oman that killed three Indian seafarers and India rejecting Trump's repeated claim of brokering a ceasefire with Pakistan have hurt relations.

What is at stalk?

The US is India's largest export market and exports have so far been resilient.

India's goods exports to the United States rose to $42.79 billion in April-August from $40.39 billion a ‌year earlier. ⁠In the fiscal year 2025/26, India enjoyed a nearly $34 billion trade surplus with the US.

India says many of its largest export categories to the US, including generic pharmaceuticals and smartphones, are not subject to the current 10% levy.

But analysts say that in the absence of a trade deal, India risks higher US tariffs from the ongoing trade probe and purchase of Russian oil, even if it could negotiate for waivers under the sanctions law.

Another increase in tariffs could ​hurt businesses, dent market sentiment and hurt ​the Indian currency, which is ⁠already trading close to record lows.

What more do the two sides want?

India is striving to protect politically sensitive sectors, particularly agriculture, while securing better tariff treatment for its exporters.

India has sought to keep dairy, poultry, rice, wheat and other farm ​products outside the scope of market-opening commitments. It wants greater certainty over US tariffs before making concessions.

The Trump administration ​wants India to ⁠cut Russian oil purchases, arguing Indian purchases of Russian crude help finance the war in Ukraine.

India says decisions on where to source fuel are driven by the energy needs of its 1.4-billion-strong population.

Russian crude became particularly important after Moscow's full-scale invasion of Ukraine because it was available at discounted prices. The war in the Middle East ⁠and resulting ​disruptions have sharpened the calculation over energy imports.

Are further talks planned?

US Secretary of State Marco Rubio ​is expected to visit India later this month, when two-way talks could make some progress.

Modi and Trump, who spoke by phone on September 30, are also expected to speak again soon to ​review progress. Modi is expected to visit the US in December for a G20 leaders' meet.

Global efforts to curb tax avoidance by multinational corporations are fundamentally altering the strategies countries use to attract foreign investment, moving the focus away from traditional tax havens toward broader economic fundamentals, according to a report released by the International Monetary Fund (IMF).

In an analytical insight following its latest (October 2026) global outlook, the IMF highlighted that international tax reforms, including the implementation of the global minimum corporate tax framework, are significantly diminishing the efficacy of low-tax regimes as a primary tool for courting global business.

In an analytical insight following its latest (October 2026) global outlook, the IMF highlighted that international tax reforms, including the implementation of the global minimum corporate tax framework, are significantly diminishing the efficacy of low-tax regimes as a primary tool for courting global business.

However, as international rules tighten to prevent profit shifting and base erosion, governments are increasingly forced to re-evaluate their investment promotion strategies, the organisation said.

Instead of competing in a "race to the bottom" on corporate tax rates, countries are now shifting their focus toward non-tax competitive advantages, it said.

These include strengthening physical and digital infrastructure, building a highly skilled labor force, ensuring regulatory predictability, and improving the overall ease of doing business.

The Washington-based lender pointed out that this structural shift offers both opportunities and challenges, particularly for developing and emerging economies.

While the erosion of tax-based competition levels the playing field, countries with severe infrastructure deficits or weak governance may face greater pressure to accelerate structural reforms to remain attractive to foreign direct investment (FDI).

The IMF urged policymakers globally to adapt to this changing landscape by aligning domestic tax administration with international standards while simultaneously prioritizing investments in productivity-enhancing public assets, human capital, and transparent legal frameworks to secure sustainable long-term economic growth.

India's Adani Power has signed a shareholders' agreement with Bhutan's state-owned Druk Green Power Corporation (DGPC) to develop the 770MW Chamkharchhu-I Hydroelectric Project in Bhutan.

The agreement was signed today (6 October), according to a statement from Adani Power.

The project marks the second major hydropower collaboration between the two companies, following the agreement for the 570MW Wangchhu Hydroelectric Project in September 2025.

It is also part of the broader 5,000MW hydropower development memorandum of understanding signed between the Adani Group and DGPC in May 2025.

The peaking run-of-river project will be located on the Chamkarchhu River in central Bhutan's Zhemgang district. Construction is expected to begin in the first half of 2027, with commissioning targeted within six years of groundbreaking.

The project will be developed through a 49:51 equity partnership, with Adani Power holding 49% and DGPC 51%.

It will be implemented under the Build, Own, Operate and Transfer (BOOT) model, with a 30-year concession from the date of commercial operation (COD).

The project is expected to help meet Bhutan's peak electricity demand during winter, while surplus power will be exported to India during the summer months.

Bhutan Prime Minister Lyonchen Dasho Tshering Tobgay, along with Finance Minister Lekey Dorji and Gem Tshering, of energy and natural resources, attended the signing ceremony.

Adani Power Managing Director Anil Sardana said surplus power from the project would be exported to India during the summer.

"Hydropower will play a pivotal role in accelerating South Asia's energy transition, and this project will contribute significantly to enhancing energy security, reducing carbon intensity, and advancing shared sustainability goals," Sardana added.

DGPC Managing Director Chhewang Rinzin said the project would strengthen Bhutan's energy security during winter while creating opportunities to optimise and export surplus clean energy to India.