Bangladesh Krishi Bank (BKB) has launched a Shariah-styled interest-free fixed deposit scheme aimed at citizens who do not wish to earn interest on their savings.

In a circular issued on 29 January, the state-owned specialised bank instructed all branch managers to start offering account opening for the scheme from 1 February, allowing any Bangladeshi citizen aged 18 or above to open such an account.

Speaking to The Business Standard, BKB Deputy Managing Director Md Khaleduzzaman said the bank's board approved the scheme after considering demand from pious citizens across the country.

Under the scheme, depositors will not receive any interest. As a result, all government and bank charges, including excise duty, will not be borne by the account holders. Instead, the bank will pay those charges on their behalf.

Depositors maintaining a specified balance will also be eligible for a debit card.

According to the circular, Bangladesh is a country with a large number of religious citizens who are interested in saving their hard-earned money for future security but do not wish to accept bank interest.

The bank believes there is strong potential to mobilise interest-free deposits from such customers.

The circular said the initiative was taken to attract interest-free and low-interest deposits and to strengthen the bank's deposit base. Approval for the account was given at the bank's 887th board meeting held on 15 October last year.

Account conditions

However, the "Krishi Bank Interest-Free Fixed Deposit Scheme" has several conditions. A minimum deposit of Tk25,000 is required, while there is no upper limit. The tenure ranges from one month to three years or longer.

According to the bank, government excise duty will be deducted every December as per rules, but the deducted amount will be automatically reimbursed by the branch within two days.

As the account is interest-free, no tax at source will be deducted.

The bank will not charge any account maintenance fees. Charges for account closure, statements and SMS services will also be waived.

In addition to individuals, mosques, temples, pagodas, churches, graveyards, madrasas, religious institutions, clubs, associations and similar organisations will be able to open the account.

Krishi Bank way too short of CMSME lending target

But, the account will be cheque-free, meaning no cheque books will be issued. Customers will receive a deposit receipt at the time of opening the account.

The account cannot be transferred from one branch to another, and no loans will be provided against it.

How it compares with other banks

Such interest-free deposit accounts are usually offered by Islamic Shariah-based banks under the Al-Wadiah system. Conventional banks with Islamic windows also offer similar products.

However, no other state-owned commercial or specialised bank currently offers a dedicated interest-free fixed deposit account. Customers at Sonali, Janata, Rupali and Agrani banks can open savings accounts by declaring in writing that they will not accept interest.

Current accounts at these banks do not offer interest either, and the same applies to most private banks. But, customers usually have to pay various service charges and maintenance fees, depending on the bank.

Currently, Rajshahi Krishi Unnayan Bank offers an interest-free savings account.

Among private banks, City Bank, AB Bank, Trust Bank, Standard Chartered Bank, Eastern Bank, United Commercial Bank and Dutch-Bangla Bank provide interest-free services through their Islamic windows or wings.

Representatives of multinational companies have voiced concern over Bangladesh's inconsistent tax policy and high rates, saying unpredictability is creating challenges for investment.

"Over the last three years, our tax rate has increased… It's hard to predict what the tax rate will be next year," said Ahmet Zahit Erdem, head of finance at Coca-Cola Bangladesh Beverage Limited, at a seminar today (3 February).

"Our tax rate is very high," he added.

The seminar titled "Review of Revenue Performance in Bangladesh: With Special Focus on Supplementary Duty and Excise", was organised by the Policy Research Institute (PRI).

Entrepreneurs from the tobacco sector echoed these concerns, noting that combined taxes on tobacco products currently stand at around 83%, an extremely high level, they said.

They recommended replacing the existing ad-valorem tax system with a specific tax system, citing the importance of predictability for industry stability and warning that excessive taxation may encourage illegal trade.

In recent budgets, beverage sector entrepreneurs have faced successive tax increases. The minimum tax on beverage products rose from 0.5% to 3% in FY23, followed by increases in supplementary duty and customs duty on imported raw materials in subsequent budgets. These changes have left investors apprehensive about potential new tax hikes.

Participating in the seminar, National Board of Revenue (NBR) Member Syed Mushfequr Rahman highlighted discrepancies between companies' financial statements and their tax and VAT payments.

"Many companies pay tax based on financial statements, but their VAT payments are much lower than expected," he said, noting that this points to governance challenges.

The NBR official also defended the government's reliance on supplementary duty, which accounts for 30% of VAT revenue and 60% of import revenue.

"We can't eliminate it overnight," he said.

Chairing the seminar, Dr Zaidi Sattar, chairman of PRI, called for reducing supplementary duty rates, particularly at the import stage, noting that duties on 1,700 tariff lines are significantly higher at import than at the local level – contradicting WTO principles.

"Once Bangladesh graduates from LDC status, maintaining such high import-stage duties will no longer be feasible," he added.

The keynote paper was presented by PRI Research Director Bazlul Haque Khondker.

Other speakers included PRI Executive Director Khurshid Alam, NBR First Secretary Md Moshiur Rahman, and Abu Zahid Parag, senior manager of Fiscal Affairs at British American Tobacco Bangladesh. Hafiz Choudhury, principal of The M Group Inc., spoke virtually.

The National Board of Revenue (NBR) has started publishing HS code-wise import data on its website to enhance transparency and improve public access to trade-related information.

The initiative follows long-standing demands from young entrepreneurs, students, investors, trade researchers, businesspeople and journalists for easier access to reliable import data, according to a press release.

By making the data publicly available, the revenue authority aims to support data-driven analysis, informed decision-making and research across the trade and investment ecosystem.

The NBR said HS code-based import information covering both commercial imports and imports under bonded warehouse facilities has been uploaded to the customs section of the publication portal on its official website.

The latest dataset, released last week, contains import information for December 2025.

The published data provide detailed product-wise information in line with HS code classifications, including quantity, weight and declared value, allowing users to analyse import patterns at a granular level and track movements over time.

Officials said the move will make import-related information more accessible, open and transparent, while significantly expanding opportunities for the use of credible data by entrepreneurs, academics, analysts, journalists and policymakers.

The availability of HS code-wise data is also expected to help stakeholders gain clearer insights into international market prices and price fluctuations, as well as analyse import trends, seasonal variations and product movement dynamics.

Besides, the data will facilitate assessments of the country's trade structure, import dependency and the flow of industrial raw materials under bonded facilities, and support evaluations of the effectiveness of incentives for export-oriented industries.

Bangladesh’s external debt has nearly doubled in just over three years, driven by a surge in emergency budget financing in the post-Covid period and a sharp devaluation of the local currency that inflated the value of dollar-denominated obligations.

The country’s total external debt jumped 92 percent to Tk 9.51 lakh crore by the end of September 2025, compared with June 2022 levels, according to a debt bulletin published Tuesday by the Ministry of Finance.

The sharp increase reflects Bangladesh’s growing reliance on quick-disbursing budget support loans rather than traditional project financing, amid weak revenue collection and widening fiscal deficits.

Between fiscal years 2021-2022 (FY22) and 2024-2025 (FY25), Bangladesh received $9.82 billion in budget support, with $3.44 billion coming last fiscal year alone.

Budget support loans, which are disbursed immediately upon approval and come with policy conditions, rose 69 percent year-on-year in FY25, even as project loans fell more than 29 percent.

The shift reflects the government’s need for funds that can be deployed immediately to cover budget operations amid weak revenue collection. Unlike project loans, which are disbursed gradually and tied to specific infrastructure works, budget support can be used directly for deficit financing.

The interim government has continued prioritising budget support over project loans, maintaining the pattern established by the previous administration.

Currency devaluation has compounded the debt burden. The local currency has weakened to around Tk 122 per dollar from Tk 85 several years ago, thanks to heightened imports in the post-Covid period and commodity price surge in global markets, among other factors.

The government’s total debt rose 1 percent to Tk 21.49 lakh crore in the first quarter of the current fiscal year, pushing the debt-to-GDP ratio up roughly two percentage points to 38.61 percent.

Of the total debt stock, Tk 11.97 lakh crore is domestic borrowing, while the remainder consists of external obligations.

The growing debt load is straining government finances. Interest payments surged 27 percent year-on-year to Tk 31,629 crore during the July-September period in FY26.

Of this, domestic interest payments rose 19 percent, while interest on external borrowings rose 80 percent. Among domestic elements, payment for treasury securities rose by 21 percent and national savings certificates by 16 percent.

Bangladesh is destined to face break-neck competition both in US and EU markets with India emerging as a major competitor with double advantages of Washington-proposed tariff cutback and trade deal with the 27-nation European bloc.

Industry insiders and experts sound the alarm over the headwinds about to blow from the two destinations Bangladesh heavily bank on for its readymade garment export -- the nation's main export earner -- and urge government action.

The recent announcement of lowering tariffs on Indian-made goods may be subject to as low as 18-percent tariffs, knocked down from the earlier-imposed 50 per cent. The brusque move from Washington came a week after the announcement of the trade deal between India and European Union.

Bangladesh should immediately act to retain duty -free market access to the European Union and enhance its competitiveness by removing supply-side constraints, industry leaders urge.

A slew of must-dos they list to overcome possible impact of the trade deal between the EU and India: coordinated reforms across trade policy, energy pricing and reliability, logistics and ports, access to finance, skills development and regulatory capacity building.

They also stress both product diversification, mostly by way of producing manmade fibre- based garments, and market diversification through exploring potential non-traditional markets.

Local garment exporters will face cutthroat competition and increased price pressure on the EU market after the free-trade agreement (FTA) announced recently between the EU and India comes into effect, possibly in 2027, as it would grant the neighbouring country's garment makers access to the bloc sans duty on apparel exports, they note.

On the other hand, Bangladesh's current duty-free market access there under EBA (everything but arms) scheme is scheduled to end in 2029 as the county is set to graduate from LDC status this coming November 2026 with a three-year transition period.

Though Bangladesh can apply for GSP- plus facility, its garment products would not get duty-free market access there due to safeguard clauses and are likely to face about 12-percent duty, they said, adding that by this time, another competitor - Vietnam -- would also get duty-free market access.

Talking to The Financial Express, Md Shehab Udduza Chowdhury, vice president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said India would be in an advantageous position with reduced rate of 18-percent tariffs compared to 20 per cent for Bangladesh.

On the other hand, the trade deal between the EU and India will be 'dangerous' for them, he said, apprehending a possible threat of losing market share there.

"The impact of the deal would be severe for us. Bangladesh is currently facing tough competition on the EU market as India and China are enhancing their focus there to offset US high-tariff impacts," says Faruque Hassan, managing director of Giant Group.

Bangladesh will become less competitive on the EU market once India secures duty-free access there, he warns.

The first and foremost tasks must be to sustain the duty-free market access there, the apparel maker-exporter told the FE, adding that the government also should initiate move to sign FTA to have an even footing on the largest market as a bloc.

Meantime, Chief Adviser of the interim government Prof Muhammad Yunus Sunday directed opening free-trade agreement (FTA) negotiations with the EU forthwith to safeguard Bangladesh's trade preferences on its largest export market.

MA Razzaque, chairman of Research and Policy Integration for Development (RAPID), says the US tariff reduction for India might not immediately affect the local garment shipment over there as Indian competitive advantage would not change because it is in disadvantage due to existing higher tariffs.

"But Bangladesh will face tremendous pressure in the medium term of three to five years as the EU-India trade deal would bring extreme challenges," he told the FE, explaining India with its backward linkages, including cotton to yarn and fabrics, will be a major competitor for Bangladesh which has to depend on imported raw materials.

Besides, there are no supply-side constraints for other major garment-producing countries like India, Vietnam, Indonesia, Cambodia and Pakistan as Bangladesh face, he adds.

The country has to immediately take measures to remove the supply-side constraints like gas and energy shortages, provide supports to the exporters to be ESG-compliant, develop skilled workforce, and reduce electricity and utility costs, ensure special bank interest rate and simultaneously attract foreign direct investment in RMG sector to boost MMF production.

"To ensure global work orders, FDI is a must for RMG and also for overall export diversification," he notes.

Local exporters will also face price pressure as India would be more competitive, says MA Rahim, vice chairman of DBL Group.

The entrepreneur, however, thinks the EU-India deal would not impact Bangladesh's export immediately, but it would affect gradually.

"India will be a strong future competitor for Bangladesh as the neighbouring country has its own raw materials, including cotton, yarn and fabrics, low labour cost while government facilitates the sector with a number of packages to increase competitiveness," Fazlul Hoque, managing director of Plummy Fashions, points out to underscore the urgency of counterbalancing actions.

Besides, India will jump into the market with better market access also to offset the high tariffs imposed by US administration, he notes.

Echoing Hassan's anxiety, Hoque, who ships up to 80 per cent of his total exports to the EU, says they immediately need government support to reduce cost of production and cost of fund, ensure uninterrupted gas supply and other issues that have been eating up competitiveness.

Hoque voices a consequential note: If Bangladesh fails to secure the duty-free market access under GSP-plus or a bilateral free-trade deal after LDC graduation, it will be out of the market.

The industry also needs to diversify its markets and products and produce manmade-fibre garments, exporters suggest.

They have also demanded incentives for attracting both local and foreign investment into man-made fibre or MMF wears to sustain export growth.

In the last fiscal year of 2024-25, the European Union accounted for more than 50 per cent, coming to US$19.71 billion, of Bangladesh's total garment exports worth over 48 billion US dollars.

Chattogram Port has been shut since Tuesday after workers, who observed an eight-hour work abstention for three days from Saturday morning, launched an open-ended strike protesting the proposed lease of the New Mooring Container Terminal (NCT) to Dubai-based DP World.

The closure has halted cargo handling at the country's largest seaport, intensifying supply chain disruptions and pressure on exporters and importers.

As of Wednesday (4 February), more than 140 vessels were waiting at the outer anchorage. Gantry cranes, tugboats, and pilotage services remained idle despite vacant berths. Port officials confirmed that not a single container has been handled since the strike began at the facility, which typically processes 8,000-9,000 TEUs daily.

The situation turned critical after a five-hour meeting between labour leaders and business representatives failed to produce a breakthrough yesterday. Economists warn that a prolonged standoff could trigger national shortages and push up consumer prices ahead of Ramadan.

We don't know what exactly is happening at Chattogram Port. Management should take locals and stakeholders into confidence.
Mohammad Abdur Razzaque | Chairman, RAPID

The disruption is rippling through Bangladesh's supply chain ahead of Ramadan, with perishable imports such as fruits, dates and edible oil stranded at the port and exporters warning of missed shipment deadlines, rising costs and potential order cancellations.

Economists and business leaders have told TBS that a prolonged standoff over the NCT lease could trigger shortages, push up consumer prices and inflict lasting damage on trade and buyer confidence.

Meanwhile, the Public Private Partnership Authority and the Chattogram Port Authority (CPA) have allegedly continued negotiations with DP World to finalise the agreement ahead of the election, even after the Supreme Court accepted an appeal against the High Court verdict that had cleared the legal barrier to the deal.

Workers said the government's insistence on pushing forward with the agreement, despite the pending appeal, has reinforced their resolve to continue the strike.

If the strike continues further, we'll be in a serious challenge, such as missing the lead time and order as well.
MA Jabbar | Managing director, DBL Group

"We don't know what exactly is happening at Chattogram Port. Management should take locals and stakeholders into confidence," said Mohammad Abdur Razzaque, economist and chairman of Research and Policy Integration for Development (RAPID). "It can't be done in isolation."

Meanwhile, Shipping Adviser Brig Gen (retd) M Sakhawat Hussain yesterday warned of tough action if any lighter ship fails to unload goods within three days of reaching the wharf.

In an inter-ministerial meeting in the capital to resolve various crises involving lighter ships engaged in transporting goods from mother vessels, he also directed the commerce ministry to publish the list in the media and cancel the licences of the responsible individuals or organisations.

Fresh fruit, dates stuck ahead of Ramadan

The impact is already being felt in the perishable goods segment. The Fresh Fruit Importers Association said more than 200 TEUs of fresh fruit containers and around 300 TEUs loaded with dates have remained stuck at the port.

Importers are now paying Tk10,000 to Tk15,000 in demurrage per container, a cost they say will inevitably be passed on to consumers.

Touhidul Alam, general secretary of the association, said that fruit imports are aligned closely with market demand. "Over the last five days of strikes, only a handful of containers have been released. If the situation continues, shortages will emerge in the market very soon," he said.

"Prices of fruits and dates will also rise," he added.

Vehicles stranded, depots clogged

Cargo delivery has remained suspended for more than 36 hours, leaving thousands of heavy vehicles stranded inside and outside the port area. To prevent further congestion, authorities have stopped allowing new vehicles to enter.

Container transportation from inland container depots has also been halted, causing a growing backlog of export cargo at depots.

Ruhul Amin Sikder, secretary general of the Bangladesh Inland Container Depots Association, said all container movement has stopped. "No trucks are leaving the port and no new containers are coming in," he said.

He noted that export cargo typically accounts for 2,500-2,800 containers a day, while imported cargo delivered to depots is gradually converted into empty containers. "So far, there is some balance in the system, and the pressure has not peaked yet," he said.

However, he warned that the situation could deteriorate rapidly if the stoppage continues. "Export volumes are rising, which means loaded export containers will increase. We can store far fewer loaded containers than empty ones," Sikder said.

He added that inland container depots have a total handling capacity of about 15,000 TEUs, with around 11,000 already in use. "If operations remain suspended for long, the system will hit its capacity limit and a serious crisis will emerge," he said.

Business leaders seek alternative to strike

The current shutdown follows three consecutive days of eight-hour work stoppages that began on Saturday. Workers launched a full 24-hour strike on Tuesday at 8am, which has since turned into an open-ended programme.

As disruptions deepened, leaders of the Bangladesh Garment Manufacturers and Exporters Association, the Bangladesh Knitwear Manufacturers and Exporters Association and other business organisations met labour leaders at a hotel in Agrabad yesterday afternoon.

Business leaders expressed solidarity with the workers' movement, calling it logical in the context of protecting the NCT. At the same time, they urged labour leaders to consider alternative forms of protest and withdraw the strike to avoid further economic damage.

Labour leaders responded that they were fighting to protect the port and warned that retreating now would embolden the CPA to take harsher action, risking the loss of a national asset. They called on business leaders to stand with the movement in what they described as the greater national interest.

Exporters, importers under mounting pressure

With a growing number of consumer goods containers stuck at the port, traders have warned of shortages and price hikes in the domestic market ahead of Ramadan.

Economists and business leaders cautioned that the standoff could spiral into an unprecedented crisis, with serious consequences for the national economy.

Abu Tayub, first vice-president of BGMEA, said hundreds of containers meant for export shipments are now stuck at inland container depots. He warned that missing shipment deadlines would force exporters to resort to air freight, which is far more expensive and would result in heavy financial losses.

"If the situation continues for a few more days, the RMG sector will be at serious risk of losing export orders and buyer confidence, which could ultimately jeopardise the entire industry," he said.

MA Jabbar, managing director of DBL Group, one of the top five garment exporters in Bangladesh, said if the strike continues further, we'll be in a serious challenge, such as missing the lead time and order as well.

Allegations, resistance and revenue debate

Leaders of the Chattogram Port Protection Movement Unity Council, which is coordinating the protests, claimed workers are participating spontaneously. They alleged that senior port officials have been confined at the Bangladesh Investment Development Authority office in Dhaka and pressured to sign the DP World contract.

They warned that the indefinite strike will continue unless the government withdraws what they termed an anti-national decision to lease out the terminal.

Former BGMEA vice-president MA Salam described the workers' movement as justified and urged dialogue to reach a solution that safeguards both national and consumer interests.

Humayun Kabir, coordinator of Bandar Rokkha Sangram Oikya Parishad, raised allegations of corruption involving senior officials and questioned the financial logic of handing over profitable terminals to foreign operators. He claimed similarly sized terminals run by the port generate significantly higher revenue than those leased out.

According to sources at the Public Private Partnership Authority, the NCT generates about $100 in gross revenue per TEU under CPA operation. After deducting $12.31 in variable operating costs and $41.32 in fixed administrative costs per TEU, net revenue stands at $46.37.

Under the proposed DP World model, the CPA is estimated to receive a revenue share of $42.50 per TEU. After accounting for unavoidable fixed administrative costs of $41.32 borne by the CPA, the authority would be left with a marginal surplus of just $1.18 per TEU.

When contacted for comment, CPA Director (Administration) and spokesperson Omar Faruk did not respond to calls.

Court bars contract signing amid legal battle

The controversy surrounding the NCT lease has also taken a legal turn. The Supreme Court on Tuesday accepted an appeal against a High Court ruling that had paved the way for the DP World deal, and referred the matter to a full bench. As part of that order, the court clarified that the government cannot sign the contract until the appeal is disposed of, creating a fresh legal hurdle for the proposed lease.

According to legal records, the dispute arises from challenges to the High Court's split verdict and questions over the legality of the process under the Public-Private Partnership Act and government-to-government policy. With the matter now sub judice, signing the contract remains legally barred until the appeal is resolved.

Bangladesh Bank (BB) purchased an additional US $171 million from 16 commercial banks on Wednesday as part of ongoing efforts to stabilise the country’s foreign exchange market.

The dollars were bought at a cut-off rate of Tk 122.30 per US dollar, a central bank official said.

This intervention follows a major purchase on Monday when the central bank acquired $218.5 million from 16 banks at the same rate. With these recent transactions, BB’s total dollar purchases in February have reached $389.5 million in just four days, reports UNB.

Aggressive Accumulation in FY2025-26

Throughout the current fiscal year, Bangladesh Bank has been actively buying dollars to curb rapid Taka appreciation and strengthen foreign exchange reserves.

The total purchases for FY2025-26 have reached $4.32 billion.

Recent Major Interventions:

Feb 4: $171 million from 16 banks

Feb 2: $218.5 million from 16 banks

Jan 29: $55 million from 5 banks

Jan 20: $45 million from 2 banks

Jan 12: $81 million from 10 banks

Jan 6: $223.5 million from 14 banks

All transactions were executed at a uniform cut-off rate of Tk 122.30.

Rationale Behind Market Intervention

Arif Hosain Khan, Executive Director and Spokesperson of Bangladesh Bank, confirmed the latest purchase, noting that the central bank employs an auction-based system to manage liquidity.

Key drivers include:

Remittance Surge: Inward remittances through formal banking channels have reached record levels, with January 2026 alone seeing $3.17 billion, leaving banks with surplus dollar holdings.

Exchange Rate Management: By setting a cut-off rate, the central bank aims to establish a floor for the Taka, supporting exporters and remitters.

Reserve Strengthening: Dollar purchases are helping rebuild the country’s foreign exchange reserves, which stood at $28.51 billion (net) as of December 2025.

Banking insiders say that while the dollar crisis of previous years has eased, active participation by the central bank remains critical to prevent market volatility and ensure a predictable exchange rate for trade planning.

Bangladesh risks losing its trade competitiveness unless it urgently reduces high logistics costs, closes policy implementation gaps, and accelerates private-sector-led infrastructure development, experts warned at a focus group discussion organised by the American Chamber of Commerce in Bangladesh (AmCham) yesterday (3 February).

Opening the discussion, Syed Ershad Ahmed, president of AmCham Bangladesh, said logistics remains the backbone of supply chains and economic activity but continues to lag behind regional peers. Drawing on over three decades of experience, he noted that despite gradual progress, Bangladesh's logistics sector is still poorly understood domestically and insufficiently prepared for rapid global shifts driven by artificial intelligence, automation, decarbonisation, geopolitics, and supply-chain resilience.

He stressed the need to bridge knowledge and capacity gaps to support growing trade and investment needs.

M Masrur Reaz, chairman of Policy Exchange Bangladesh, highlighted the scale of the challenge, saying logistics efficiency is central to export growth through lower costs, faster delivery, and productivity gains. He pointed out that Bangladesh's heavy reliance on the Dhaka–Chattogram corridor, which handles nearly 70% of national trade, poses a structural risk. Disruptions such as the recent Chattogram port labour strike demonstrate the fragility of the system.

Reaz also flagged gaps in implementing the National Logistics Policy, including government monopolies in rail and air cargo, weak inter-ministerial coordination, and the absence of a central logistics authority.

He called for greater private and foreign investment, particularly in cold chains and rail logistics, increased automation, and expert-led infrastructure planning, citing projects such as the Matarbari Deep Sea Port, Bay Container Terminal, and the third terminal at Hazrat Shahjalal International Airport as key opportunities.

Focusing on air logistics, Mahbubul Anam, managing director of CF Global, said costs at Dhaka airport are 20–25% higher than road transport, underscoring the need for stronger public-private coordination, supportive policies, and adequate equipment. He warned that growing e-commerce demand for express logistics will strain existing capacity without urgent reforms and highlighted the absence of direct cargo flights to the US despite clearance facilities for the European Union.

From a development partner perspective, Nusrat Nahid Babi, senior transport specialist for South Asia at the World Bank, said the logistics reform momentum built since 2022 must be reaffirmed by the new government through clear priorities and high-level consensus.

She outlined a phased reform agenda covering policy simplification, multimodal connectivity, skills development, digitalisation, and investment, with immediate emphasis on operationalising the National Logistics Policy 2025 and establishing a logistics division under the Prime Minister's Office.

Md Moinul Huq, Citi country officer of Citibank N.A. Bangladesh, urged customs authorities to implement the Customs Act 2023 by clearly defining electronic documentation and payment procedures. He also criticised the continued reliance on letters of credit, calling for more flexible settlement mechanisms to improve trade competitiveness.

The discussion concluded with a strong call to move from policy intent to execution. Participants urged faster ratification of the National Logistics Policy 2025, structured private-sector engagement, investment in multimodal logistics hubs, and accelerated rollout of digital trade initiatives to enhance efficiency, resilience, and job creation.

The interim government’s net borrowing from the banking system rose almost fivefold in the first seven months of the current fiscal year 2025-26, as spending raced ahead of sluggish revenue collection.

The government borrowed Tk 48,819 crore from banks as of January 25, compared with Tk 10,558 crore by January 23 last year, according to Bangladesh Bank (BB) provisional data.

The amount already accounts for nearly half of the full year’s borrowing target of Tk 104,000 crore.

The sharp rise reflects a widening gap between expenditure and income. Government spending has climbed steadily, while revenue collection has failed to keep pace.

The National Board of Revenue posted a 14 percent year-on-year growth in collection in the first six months of FY26, mobilising Tk 185,229 crore. Even so, receipts fell short of the target by about Tk 46,000 crore.

In the same period last year, revenue slipped by 1 percent amid unrest following the political changeover in August 2024.

“This is not a sustainable situation,” said Fahmida Khatun, executive director of private think-tank the Centre for Policy Dialogue (CPD).

She said weak domestic resource mobilisation pushes debt levels higher and leaves little room to manage day-to-day spending. “The revenue collection remains so low that it is difficult to manage regular expenditure.”

According to the economist, the country’s persistently low tax-to-GDP ratio has made the government increasingly reliant on bank borrowing, driving up debt and interest payments.

In FY25, interest payments reached a record Tk 132,460 crore, almost one-fifth of total budget spending, according to the finance ministry’s debt bulletin.

For the current year, interest costs stand at Tk 122,000 crore, accounting for 13 percent of the budget.

As debt servicing takes up a larger share of public funds, allocations for education, health and infrastructure are squeezed, undermining long-term growth prospects.

Fahmida said that unless tax collection grows fast, heavier government borrowing from banks will also tighten credit for the private sector.

Ashikur Rahman, principal economist at the Policy Research Institute (PRI), warned that a risky cycle is beginning to take hold.

Higher borrowing, he said, feeds directly into a growing interest burden within the fiscal framework.

“As debt servicing absorbs a larger share of public expenditure, fiscal space for productivity-enhancing investments, particularly in human capital, health, education, and critical infrastructure, shrinks,” he explained.

Over time, this trade-off weakens the state’s ability to address structural development constraints and undermines the quality of growth itself, said Rahman.

Rising government demand for credit also crowds out private firms, pushing up borrowing costs and discouraging investment.

“This is particularly concerning at a time when economic recovery and employment generation depend critically on a revival of private sector confidence and investment momentum,” he added.

The persistence of high borrowing also points to deeper weaknesses on the revenue side. Despite some gains, collections remain far below what is needed to finance public spending in a sustainable way.

“This points to longstanding deficiencies in tax policy design, tax administration, and compliance. Without a durable improvement in domestic resource mobilisation, borrowing risks becoming a default adjustment mechanism rather than a temporary counter-cyclical tool,” he said.

Breaking the cycle, Rahman said, will require prudent debt management alongside credible revenue reforms and a clear medium-term fiscal strategy that shifts spending towards growth-enhancing priorities rather than debt servicing.

More pressure is expected in the months ahead. The rollout of a new pay scale for government employees will require an additional Tk 106,000 crore, around one-fifth of total operating expenditure for the year.

CPD’s Fahmida suggested the increases should be phased in.

Otherwise, she said, maintaining fiscal balance will become one of the toughest challenges for the next government.

Bangladesh is stepping into a new phase of trade diplomacy as it signs its first Economic Partnership Agreement (EPA) with Japan tomorrow, a deal meant to preserve duty-free market access after the country’s graduation from the least developed country club later this year.

A Bangladesh delegation led by Commerce Adviser Sk Bashir Uddin will leave Dhaka for Tokyo today to sign the agreement, Commerce Secretary Mahbubur Rahman told The Daily Star yesterday.

The EPA, approved by the Advisory Council on January 22, will give Bangladeshi exporters immediate duty-free access to 97 percent of their export basket, including ready-made garments (RMG) and nearly 7,379 other products.

In return, Japan will receive duty-free access to 1,039 products in the Bangladeshi market.

Automobiles from Japan, home to global brands such as Toyota, Honda and Subaru, will not enjoy duty-free entry under the deal, according to the commerce secretary.

Rahman said the move is deliberate to encourage Japanese entrepreneurs to invest directly in Bangladesh’s vehicle segment.

Officials believe this could prompt “handsome” investment in local vehicle manufacturing, possibly reshaping the country’s automotive industry.

Japan is already Bangladesh’s largest export destination in Asia, with annual shipments hovering around $2 billion, mostly garments.

Imports from Japan, however, have remained relatively steady at around $1.8 billion to $2.7 billion in recent years, according to data from the Bangladesh Bank and the Export Promotion Bureau (EPB).

Officials say the EPA could help narrow this trade deficit by boosting exports while drawing Japanese capital into industrial zones across the country.

Apart from tariffs, the agreement covers trade in services, investment, customs procedures and intellectual property rights, according to the commerce ministry.

“We are expecting a major shift of Japanese investment in Bangladesh under this EPA, as Japan is looking for a favourable investment destination and is choosing Bangladesh,” Commerce Secretary Rahman said.

At present, Japanese investment in Bangladesh stands at about $500 million, a small slice of Japan’s global investment. Still, several Japanese firms have already set up operations at the dedicated Japanese economic zone at Araihazar in Narayanganj district.

Under the deal, Bangladesh will open 97 service sub-sectors to Japan, while Japan will open 120 to Bangladesh. Officials expect this to speed up technology transfer and encourage long-term investment.

According to commerce ministry documents, garments will receive immediate duty-free access under Single Stage Transformation rules, a major win for the local RMG sector as the country prepares for the post-LDC competition.

For years, Bangladesh has been looking for trade agreements with major partners and blocs, including India, Turkey, Malaysia, China, the UAE, Indonesia, Nepal, Asean and the Regional Comprehensive Economic Partnership (RCEP), to widen its footprint in Asian, African and Latin American markets.

Until now, the country has only signed a Preferential Trade Agreement (PTA) with Bhutan in 2020. This EPA with Japan marks its first full-fledged trade deal.

Dhaka and Tokyo had been progressing towards this deal since 2022, when then prime minister Sheikh Hasina said Bangladesh was open to negotiating free trade agreements, including with Japan.

Subsequently, a joint study group was formed. Talks gathered pace in July 2023, with both sides signalling their intention to sign the EPA by late 2025 or early 2026, ahead of Bangladesh’s LDC graduation.

Momentum picked up after the Advisory Council gave its nod on January 22 this year, following Japan’s approval of the draft in December.

Last month, Japan also reaffirmed at the World Trade Organisation (WTO) that it would continue duty-free market access for Bangladesh for three more years, up to 2029.

Regarding the EPA with Japan, analysts say this sends a message about the country’s readiness to engage with major economies and trading blocs.

Abdur Razzaque, chairman of local think tank Research and Policy Integration for Development (RAPID), called the deal a positive signal but stressed that its success would depend on execution.

“It is a positive signal for Bangladesh to the foreign investors as it is a testimony that Bangladesh is capable of signing the deal even with Japan,” he said, adding that the country should actively attract Japanese investment, especially in export-oriented sectors such as man-made fibre industries.

Similarly, M Masrur Reaz, chairman of Policy Exchange Bangladesh, called the agreement an excellent development.

“This EPA will enable Bangladesh to be a partner of a country which is a member of the G-7. It will brighten our image,” he said.

If used well, the deal could also open new doors for foreign direct investment, Reaz added.

A high-stakes race to hand over Bangladesh's most profitable maritime asset to a foreign operator has ignited a firestorm of legal challenges, labour strikes, and allegations of massive financial undervaluation.

Under the watch of an interim administration, the Chattogram Port Authority (CPA) is fast-tracking a 15-year concession for the New Mooring Container Terminal (NCT) to UAE-based DP World. While officials defend the move as a necessary leap towards global efficiency, critics argue the deal is being "rammed through" just days before national elections and in defiance of a sub judice court process.

At the centre of the controversy is the New Mooring Container Terminal (NCT), a strategic facility that handles around 90% of Bangladesh's containerised cargo. The Chattogram Port Authority (CPA) has moved to lease out the terminal and its adjacent Overflow Container Yard to UAE-based global operator DP World for 15 years under a government-to-government arrangement.

The move has raised concerns among economists and labour leaders over whether the interim government has the mandate to finalise a long-term international concession involving a strategic national asset.

Critics have also questioned the valuation and single-bidder nature of the process, while officials argue the deal is necessary to expand capacity and improve efficiency at the country's main maritime gateway.

The government has not publicly responded to questions about the interim administration's legal authority to sign long-term concessions.

Timeline set before court verdict

Documents reviewed by The Business Standard reveal that the CPA issued a 63-page RFP on 8 January, seeking proposals for the operation and maintenance of the NCT and its Overflow Container Yard. Crucially, this occurred three weeks before the Supreme Court's 29 January ruling, which upheld the legality of the leasing process.

The deadline for clarification was 11 January, with pre-bid meetings held on 14 and 15 January. An addendum followed on 20 January, and the bid submission deadline has been fixed for 19 February 2026.

A senior official of the Public Private Partnership Authority, speaking on condition of anonymity, said most formalities had already been completed.

"Now, a few final-stage formalities are under process. Once they are completed, the concession agreement can be signed anytime this week before the election," the official said.

Legal experts have questioned the propriety of proceeding while the matter was sub judice.

Barrister Anwar Hossain, representing the petitioners, told TBS, "When a matter is sub judice, you cannot proceed with it. If the CPA submitted the RFP and held meetings during the court hearing, they defied the court."

He added that an application seeking a status quo on the verdict has already been filed. "Even if the court sends the appeal to a full bench without issuing a status quo, the authority is not legally allowed to proceed with the agreement," he said.

Labour strike disrupt port operations

The proposed handover has triggered strong resistance from port workers. A two-day eight-hour work abstention from Saturday to Sunday, followed by another protest today (2 February), paralysed cargo handling and vessel movement at Chattogram Port.

Workers today announced a further 24-hour strike from 8am tomorrow, which they say coincides with an initial target date for signing the concession agreement.

Chattogram Port, which typically handles 8,000-9,000 TEUs of containers a day, has seen a significant drop in its activity.

Labour leaders argue that NCT is a highly profitable facility and accuse authorities of undervaluing it. According to them, the current tariff generates around $161 per TEU at NCT. Even if operating costs are estimated at $56 per TEU, the port earns roughly $105 per container.

"The CPA and the Rate Negotiation Committee want to hand over NCT to DP World at $105 per TEU. A top government official is pressuring Chattogram Port to hand it over at just $42 per TEU," alleged Humayun Kabir, coordinator of the Bandar Rokkha Sangram Oikya Parishad.

CPA documents reviewed by TBS do not publicly disclose the basis for the proposed per-TEU rate.

Another protesting leader, Ibrahim Khokan, questioned the urgency of the decision. "The country will have an elected government in just 10 days. Why doesn't the interim government leave such a strategic decision to the elected government?" he said, alleging personal interests behind the rush to finalise the deal.

Lease process

Operational since 2007, NCT is one of the most critical facilities at Chattogram Port, Bangladesh's principal maritime gateway. The brownfield riverine terminal has an 820-metre quay wall, four container berths and extensive back-up facilities. The adjacent Overflow Container Yard, developed in 2015, provides additional container storage.

According to the RFP, the government aims to expand port capacity and improve efficiency to support growing manufacturing and export sectors. DP World was selected as the potential partner, with the International Finance Corporation (IFC) acting as transaction adviser.

The concession includes a transition period of up to six months, followed by a 15-year operation and maintenance phase. At the end of the term, the facilities will revert to the CPA at no cost, except for any additional equipment installed by the operator. A feasibility study estimates the project cost at $205 million.

The RFP restricts bidding to DP World or a consortium led by it, with the lead member holding at least 51% equity. Bidders must submit legal, technical and financial proposals in English, along with a $1.5 million bid security valid for 180 days.

Technical bids will be evaluated first, followed by financial bids. The successful bidder will have to pay a $2 million project development fee to the IFC and a $4,00,000 success fee to the PPP Authority. A Bangladeshi special-purpose vehicle must be formed, with shareholding locked in for 10 years.

To qualify, bidders must show experience in managing at least one container terminal handling a minimum of 7,50,000 TEUs annually in each of the last three financial years and a net worth of at least $100 million per year over the same period.

The process received in-principle approval from the Cabinet Committee on Economic Affairs in March 2023. A writ petition filed by the Bangladesh Young Economists Forum later challenged the lack of open competition and transparency.

After a split High Court verdict in late 2025, the Supreme Court's 29 January ruling removed the final legal hurdle. However, an application seeking a status quo on the verdict was subsequently filed.

Omar Faruk, director (administration) of the CPA, told journalists at a briefing on Sunday that leasing out NCT to DP World is a government decision. "The CPA is just implementing the government's decision," he said.

Professor Anu Muhammad, a noted economist, questioned the legal authority of the interim government to proceed with a long-term international agreement. He argued that the interim administration's mandate was limited to holding elections and did not extend to signing strategic international contracts.

"They must withdraw from activities related to international agreements, including Chattogram Port. Advisers and special assistants should stop engaging in these matters," he said, expressing solidarity with protesting port workers.

Bangladesh's export earnings remained largely stagnant in the first seven months of the current fiscal year, as a sustained slowdown in garment shipments continued to outweigh incremental gains in non-readymade garment sectors, reflecting the economy's dependence on a single export pillar.

According to data from the Export Promotion Bureau (EPB), exports during July-January FY26 stood at $28.41 billion, registering a 1.93% year-on-year decline, even as shipments rebounded 11.22% month-on-month in January.

Readymade garments (RMG), which account for about 81% of Bangladesh's export basket, recorded a 2.43% year-on-year fall during the period, exerting downward pressure on overall export performance despite moderate growth in several non-RMG segments, including engineering products, leather goods, jute items, frozen fish and home textiles.

Export earnings from the RMG sector amounted to $22.98 billion in the July-January period, down from a year earlier. Within the segment, knitwear exports declined by 3.13%, while woven garment shipments fell 1.60%, reflecting weak demand and continued price pressures in major markets.

In contrast, non-RMG exports posted relatively stronger growth, though from a much smaller base.

EPB data show that engineering product exports rose by nearly 26%, driven by sharp increases in bicycle exports (31%) and electrical products (26.8%).

Exports of leather and leather goods increased 5.7%, while home textile shipments grew 3.3% and jute and jute goods exports edged up by just over 2% during the period.

Fazle Ehsan Shamim, vice president of the BKMEA, told The Business Standard that exports have slowed due to both global and domestic factors.

"The US's reciprocal tariff on Bangladeshi products reduced orders, while Indian and Chinese exporters gained greater access to the EU market, affecting Bangladesh's garment shipments," he said.

Shamim also cited domestic political uncertainty ahead of elections, which led major buyers to cut orders by 20-30% to avoid delivery risks.

MA Rahim Firoz, vice chairman of DBL Group, said historical experience shows that foreign buyers often reduce orders before and after elections – a trend observed for the past 30 years. He predicted this pattern would continue over the next two months, with significant growth only expected from April.

Exports decline for 6th consecutive month

Bangladesh's exports fell in January 2026, continuing a six-month streak of year-on-year declines. Export earnings reached $4.41 billion, down 0.50% from $4.43 billion in January 2025, EPB data shows.

Industry sources noted that such consecutive point-to-point declines have not been seen since the global Covid-19 lockdowns in 2020, when shipments were disrupted worldwide.

Data further show that exports in the first month of FY26, July 2025, stood at $4.77 billion. The following months recorded $3.91 billion in August, $3.62 billion in September, $3.82 billion in October, $3.89 billion in November, and $3.96 billion in December.

This indicates a significant drop in exports from the levels seen at the start of the fiscal year. Last July, the US imposed reciprocal tariffs on Bangladeshi products, putting pressure on the country's largest export market, which in turn affected other markets. Conditions gradually improved in subsequent months.

For comparison, in FY25, exports were $3.82 billion in July, $4.03 billion in August, $3.80 billion in September, $4.13 billion in October, $4.12 billion in November, and $4.62 billion in December.

RMG exports show slight decline

The country's main export product, ready-made garments, fell 1.35% year-on-year in January. RMG shipments amounted to $3.61 billion, down from $3.66 billion in January 2025. However, RMG exports rose 11.77% compared with December 2025.

Exports to Germany, France, Italy, Japan, Denmark, Australia, Sweden, Belgium, and Turkey declined in January compared with December. By contrast, shipments increased to the US, UK, Spain, Netherlands, Poland, India, Canada, China, UAE, and Saudi Arabia.

Exports to India grew the most, rising 19.23% month-on-month to $166 million in January, up from $127 million in December. Despite this, cumulative exports to India in the first seven months (July-January) fell 4.98% to $1.05 billion, down from $1.10 billion in the same period of FY25.

Business Research International Corporation (BRIC) is set to establish a large-scale agro-processing industry in the Jamalpur Economic Zone (JEZ) with an investment of approximately $5.32 million.

A land lease agreement was signed today (2 February) between the Bangladesh Economic Zones Authority (BEZA) and BRIC at the BEZA office in the city, according to a press release.

Executive Member (Investment Development) and Additional Secretary Saleh Ahmed signed the agreement on behalf of BEZA, while Director and Vice President Mishal Karim signed on behalf of BRIC.

Under the agreement, a modern agro-processing plant will be established and operated as a joint venture, with a focus on promoting markets for locally produced agricultural goods. The initiative aims to strengthen the country's agro-based industrial sector and expand production for both domestic and export markets.

BEZA said BRIC will invest about $5.32 million in the proposed project on five acres of land. The project will be an export-oriented and environmentally friendly industrial venture, requiring relatively low water, electricity and gas consumption.

The company plans to start commercial production within three years. Its products will include paste, pulp, puree, juice and beverages, and spices. More than 50% of raw materials will be sourced locally.

The project is expected to create significant local employment. BRIC intends to export 15% of its output, which is expected to strengthen Bangladesh's competitiveness in international markets through modern technology and quality production.

Such investment is expected to accelerate industrialisation in the agriculture sector, boost exports, create new jobs, and contribute to sustainable economic growth in the region.

Congratulating the company, Saleh Ahmed said the JEZ is set to become a plug-and-play economic enclave.

"A leading company is expected to start production here soon," he said.

Referring to BRIC's investment, he said it was "an example of BEZA's environmentally friendly industrial initiatives" and expressed hope that "such agro-processing projects will encourage more local and foreign investors to invest in the JEZ."

The JEZ is the first government economic zone under implementation in the Mymensingh division. The zone will be developed on a total area of 436 acres and is expected to create direct employment opportunities for around 32,000 people once fully implemented.

According to the feasibility study, the zone is suitable for agro-based industries, light engineering, garments and other sectors. Key infrastructure, including gas connections, a 33/11 kV power substation, administrative and dormitory buildings, land development, a groundwater reservoir and boundary walls, has already been completed.

So far, lease agreements have been signed with 18 companies to set up industries in the zone. Construction work is currently underway for six industrial units, including a skills development centre.

US dollar purchases by Bangladesh Bank from the forex market have surpassed $4 billion so far in fiscal year (FY) 2025-26.

The banking watchdog yesterday bought $218.50 million from 16 commercial banks at a cut-off rate of Tk 122.30 per US dollar, according to official data.

This is the first US dollar purchase by the banking regulator in February.

Overall foreign exchange purchases in the ongoing fiscal year have reached $4.152 billion, reflecting continued efforts by the central bank to manage liquidity in the foreign exchange market and stabilise the exchange rate.

The central bank has been actively buying the American greenback from the market in recent months amid improved inflows and easing pressure on the foreign exchange market, officials said.

BB, which sold more than $25 billion from its foreign exchange reserves between FY21 and FY25 to help cover imports of fuel, fertiliser, and food, has begun purchasing US dollars since the start of this fiscal year as supply has increased due to higher exports and remittances.

Since early July, the Bangladeshi taka has gained against the dollar.

Bangladesh’s forex reserves have continued to rise due to the central bank’s consistent USD purchases.

Bangladesh’s gross foreign exchange reserves stood at $33.18 billion as of January 29 this year, according to BB data.

However, the figure stood at $28.68 billion under the International Monetary Fund’s Balance of Payments and International Investment Position Manual (BPM6).

Bangladesh Bank Governor Ahsan H Mansur has said that state-owned commercial banks disburse loans but have consistently failed to recover them on time, a weakness that has kept credit growth in the sector constrained for decades.

Speaking as a special guest at the Sonali Bank Annual Conference 2026 at the International Convention City Bashundhara today (2 February), the governor said long-standing structural problems had limited the role of government banks in the economy.

"If loans can be given to the right customers, those loans will no longer remain unrecovered," he said.

He noted that various restrictions had been imposed on government banks, including Sonali Bank, which were still in effect.

"Government banks can give loans, but they cannot recover them. For this reason, the flow of credit had to be contracted," he said.

He added that credit growth at state-owned banks had remained constrained since before 2000, which he described as an unsustainable model.

The governor said banks that mobilise deposits must also be able to channel those funds into productive economic activities.

"If a bank collects deposits and we cannot contribute that to the macro-economy, then our achievement will be diminished," he said.

He said Sonali Bank had been cautious in loan disbursement but now needed to strike a balance.

"Sonali Bank is distributing loans with great caution. I think now loans must be distributed with a bit of courage along with that," he said.

Ahsan H Mansur also pointed to the limited role of state-owned banks in consumer lending.

"The consumer lending sector is an important sector. In other countries, house lending is a very large sector, but the government banks of our country are unable to make any major contribution," he said.

He said Sonali Bank should be transformed into a fully commercial institution.

"Currently, Sonali Bank is operating as a partial commercial principal bank. It must be developed into commercial banking on a larger scale and become more profit-oriented," he said.

According to the governor, profits earned by the bank could help reduce its capital deficit and meet future capital and provisioning requirements, eventually enabling it to pay dividends.

He added that the government would give Sonali Bank the freedom to operate on true commercial principles and said future governments would maintain that approach.

He also stressed the need to increase remittance inflows, noting that Sonali Bank plays a significant role in opening letters of credit for the government.

The governor said Sonali Bank's non-performing loan ratio was at a "tolerable level" and had improved from earlier figures.

"I can expect it to decrease a bit more," he said, adding that loan disbursement needed to rise.

"If Sonali Bank takes Tk2 lakh in deposits, then 80% of that must be distributed as loans," he said, while emphasising the need for careful borrower selection.

He said banks must identify capable entrepreneurs at the grassroots level, particularly among small and medium enterprises, and strengthen support for export-oriented activities.

Bangladesh's merchandise-export earnings during the first seven months of the current fiscal year stayed on a negative growth trajectory as main earner garment shipments to major EU countries and other destinations contracted.

Germany and France are among the major destinations in the European Union (EU) where apparel faced a setback, being undercut by big peers in their shift away from the tariff-walled United States, industry sources said, as the latest export-performance results published.

The single-month merchandise-export earnings in January 2026 for the sixth consecutive month, on a year-on-year basis, also registered negative growth compared to the same month in 2025, according to the data released Monday by Export Promotion Bureau (EPB).

Bangladesh earned US$28.41 billion during the July-January period of the fiscal year 2025-26, reflecting 1.93-percent year-on-year negative growth against $28.96 billion in the corresponding period of last fiscal.

In the just-past month, January, the country's export earnings stood at $4.41 billion which was slightly or 0.50-percent lower than the earnings worth of $4.43 billion in January 2025.

Exports went on a year-on-year negative growth in August 2025, when the country recorded a 2.93-percent fall.

The climb-down was followed by a decline of 4.61 per cent, 7.43 per cent, 5.58 per cent and 14.25 per cent in September, October, November and December respectively.

Of the total January earnings, RMG fetched $3.61 billion, logging a 1.35- percent negative growth compared to that in the same month of 2025, the EPB data revealed.

As usual, RMG maintained its leading position, contributing $22.98 billion-notwithstanding a 2.43-percent negative growth - to the total export earnings during the first seven months of the current fiscal year.

Within this clothing segment, knitwear exports fell by 3.13 per cent to $12.28 billion, while that of woven garments declined by 1.60 per cent to $10.69 billion.

Sources say while the strong performance in July reflects resilience, the slowdown since August highlights challenges for Bangladesh's export sector amid fluctuating global demand and evolving market dynamics.

Exporters, however, attribute the country's negative export growth to weakening global demand, the imposition of reciprocal tariffs by the United States and China's increased focus on markets where Bangladesh is competitive.

They also say cutthroat global competition, rising production costs, and ongoing geopolitical and trade uncertainties have created significant external pressures, contributing to the current challenges in Bangladesh's export performance.

Talking to the FE, Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said December-to-February "is usually the season of summer orders compared to that of winter and previously there had been growth during the period".

Export still was in negative territory which according to him is not good.

MA Rahim, vice chairman of DBL Group, says buyers usually hold some of their work orders before two to three months prior to the national election and they observe the situation for at least one month after election.

He expects that buyers would come back with the orders they hold temporarily or shifted to other places once a stable political situation sustains after the election.

The US tariffs have changed the overall market dimension with decline in sales there and so decrease in placing work orders, exporters say. Moreover, China and India to offset US tariff impacts are "snatching away the work orders by offering 'aggressively low rate'".

The Indian government has also incentivised with new packages to support its exporters targeting US high tariffs whereas Bangladesh government has been withdrawing the given benefits, including cuts in incentives "in the name of LDC graduation", they lament.

They, however, expect good days ahead after the national elections, saying that the situation might change with elected government provided with required and expected policy supports in consultation with businesses.

The July-January breakdowns show home-textile exports rose 3.26 per cent year on year to $509.97 million.

Leather and leather products earned $707.24 million, up 5.71 per cent.

The agricultural sector saw a 9.88-percent negative growth to $607.28 million.

Jute and jute goods exports reached $493.85 million, marking 1.97-percent growth during the period of 2025-26 fiscal.

Frozen and live fishes recorded 4.94-percent growth to fetch $297.56 million during the first seven months of fiscal 2025-26.

Pharmaceutical exports grew by 5.03 per cent to $139.10 million.

Meantime, Bangladesh's overall exports to its major billion-dollar destinations like Germany, France, Italy, Denmark, India and Japan fell 10.35 per cent, 11 per cent, 5.46 per cent, 10.40 per cent, 4.98 per cent and 2.78 per cent during the July-January period of 2025-26.

In FY25, Bangladesh exports fetched $48.28 billion, riding on $39.34 billion earnings from RMG.

To stabilise the foreign exchange market and support remittance and export inflows, the Bangladesh Bank has purchased over $4 billion from commercial banks through auctions in the current fiscal year.

Bangladesh Bank Executive Director and spokesperson Arif Hossain Khan told journalists on Monday that the central bank has bought $4.15 billion so far this fiscal year.

Today alone, it purchased $218 million from 16 commercial banks at a rate of Tk122.30 per dollar, bringing the total purchases for February to $218 million.

Dollar supply has increased due to rising remittance inflows through banking channels, prompting commercial banks to sell dollars to the central bank.

A senior Bangladesh Bank official told The Business Standard that banks are keen to sell dollars, while the central bank is increasing its reserves through these purchases.

In January 2026, the country received $3.17 billion in remittances – the third-highest monthly inflow on record. This marks a 45.41% increase compared to $2.18 billion received in January 2025.

Previously, the highest remittance inflow was recorded in March 2025 at $3.29 billion, followed by $3.22 billion in December 2025.

A senior official said Bangladesh Bank is buying dollars mainly to sustain export and remittance flows and to prevent a fall in the exchange rate.

Bangladesh Bank began purchasing dollars through auctions for the first time in July 2025. These purchases have injected a significant amount of liquidity into the banking system.

Finance Adviser Salehuddin Ahmed today (2 February) said that while the interim government has made concerted efforts to stabilise the national economy, the challenges lying ahead remain formidable and complex.

Several significant hurdles persist that will require rigorous navigation, said the adviser while addressing the Sonali Bank Annual Conference 2026 as the chief guest at the International Convention City Bashundhara (ICCB) in Dhaka.

He emphasised that the future economic environment would demand resilience and a strategic approach to overcome these difficult phases.

Addressing the Sonali Bank officials, Salehuddin stressed the importance of standing as a fully professional institution.

He remarked that as a new government (elected) will eventually take over, the bank's management must work tactfully to maintain its standards.

Salehuddin Ahmed cautioned that while political and bureaucratic obstacles might arise, officials should not dismiss them casually but rather negotiate them with professional integrity.

He further advised the bank's officials on how to interact with policymakers and politicians, as he suggested that instead of an outright refusal to comply with questionable demands, officials should explain the established financial norms, audit requirements, and accounting standards that govern such institutions.

The finance adviser also urged Sonali Bank to extend its support to businesses, highlighting the necessity of financing for all types of enterprises, ranging from small-scale ventures to large industries.

He expressed his expectation that the bank would play a proactive role in fostering trade and commerce through adequate financing.

The finance adviser observed that while the overall banking sector faces various difficulties, the performance of Sonali Bank and a few other private banks remains commendable.

Bangladesh Bank (BB) on Monday purchased $218.50 million from 16 commercial banks through multiple auction methods as part of its ongoing strategy to curb the depreciation of the US dollar against the taka and revitalise the remittance and export sectors.

According to central bank data, it bought dollars today at the rate of TK 122.30.

Accordingly, total purchases stood at $218.50 million in January 2026 and $4,152 million in FY 2025–26 till to date.

An additional financing agreement and a grant agreement were signed yesterday between the government of Bangladesh and the International Development Association (IDA) of the World Bank (WB) Group for an amount of US$ 150 million loan and US$0.75 million grant to implement the “Recovery and Advancement of Informal Sector Employment (RAISE) Project.”

The project has been under implementation since 2021 and is scheduled to continue until June 2026 with the World Bank support. The implementation period for the additional financing is until 31 December 2030.

Md. Shahriar Kader Siddiky, Secretary, Economic Relations Division (ERD), Ministry of Finance and Jean Pesme, Division Director of the World Bank for Bangladesh and Bhutan signed the financing agreements on their respective sides. The project is being implemented by the Palli Karma-Sahayak Foundation (PKSF) under the Financial Institutions Division of the Ministry of Finance, said an ERD press release.Finance software

The objective of the project is to provide services that can enhance earning opportunities and employment for low-income urban and rural-youth and youth impacted by Covid-19.

The additional financing comprises a US$150 million loan from IDA and a US$0.75 million grant from the Early Learning Partnership Multi-Donor Trust Fund (ELP MDTF).

The loan carries an interest rate of 1.5 percent, a commitment fee of up to 0.50 percent on the undisbursed balance, and a maturity period of 25 years, including a 5-year grace period.

The World Bank is the largest multilateral development partner of Bangladesh. This financing reflects the deep cooperation between Bangladesh and the World Bank. Currently, the World Bank financing is covering a wide range of sectors, including economic and social development, institutional reforms, infrastructure development, and energy sector advancement.