The Bangladesh Securities and Exchange Commission (BSEC) has imposed financial penalties on Index Agro Industries Limited and brokerage firm Prudential Capital Limited for violating securities laws and regulatory requirements.

According to the regulator's monthly enforcement action report for March, the market watchdog fined several officials of Index Agro Industries after identifying irregularities involving undisclosed related-party transactions and lapses in internal governance practices.

Index Agro Industries Managing Director Mahin Bin Mazher was fined Tk5 lakh, while Chief Financial Officer Iqbal Ahmed and Company Secretary Abu Jafar Ali were each fined Tk1 lakh.

According to the BSEC report, an inspection team conducted an on-site review of the company's operations, visiting four factory premises as well as the company's head office. The inspectors also examined documents and records submitted by the company at different times to verify compliance with regulatory and accounting standards.

During the inspection, the committee found a related-party transaction worth Tk2 crore between Index Agro Industries and Index Construction Limited.

The inspection found that both the chairman and the managing director of Index Agro Industries also hold positions on the board of Index Construction, making the transaction subject to disclosure requirements under International Accounting Standard.

However, the BSEC found that the Tk2 crore transaction was not disclosed in the company's audited financial statements for the year ended 30 June 2022. The omission was deemed a violation of the accounting standard, which requires companies to disclose transactions with related entities so that stakeholders can assess their financial impact and governance implications.

The regulator also raised concerns over the role of the company's auditor. According to the enforcement report, the statutory auditor, G Kibria and Co, stated in the audit report that the company had no related-party transactions in the normal course of business during the financial year ending June 2022.

This statement conflicted with the inspection findings, raising questions about the accuracy of the audit assessment and compliance with the responsibilities of external auditors.

The inspection further uncovered irregularities in the authorisation of work orders related to construction, civil works and associated activities carried out by the company. Investigators found that some inspection orders that were supposed to be signed by authorised officials of Index Agro Industries were instead signed by representatives of Index Construction.

The inspection team also reported that it had identified alternative quotations for certain works that were higher than those provided by Index Construction, prompting questions about whether procurement processes were conducted in line with standard competitive practices.

In a separate enforcement action, the BSEC also fined brokerage firm Prudential Capital Tk10 lakh for violations related to discrepancies in share records and irregularities involving beneficiary owner (BO) accounts.

The company's Managing Director Rezaul Islam was fined Tk5 lakh, while its former compliance officer AY Zobaer was fined Tk1 lakh.

According to the enforcement report, the irregularities came to light following a letter from ICB Securities Trading Company dated 26 February 2025, which highlighted a mismatch involving 1 lakh shares of Robi Axiata between depository participant accounts and the brokerage firm's back-office system during share reconciliation.

Further investigation revealed that the shares were purchased on behalf of an investor, Ava Dutta, through Prudential Capital Limited on 2 February 2023. The brokerage later transferred the shares to a BO account under the depository participant of ICB Securities Trading Company Limited.

However, scrutiny of Central Depository Bangladesh Limited records by the Dhaka Stock Exchange's monitoring team found that the BO account in the name of Ava Dutta under Prudential Capital was opened on 27 March 2023, nearly two months after the shares were reportedly purchased on her behalf on 31 January 2023.

The regulator said this sequence indicates that the shares were bought before the account was formally opened, raising questions about compliance with operational procedures and investor account management rules.

Such discrepancies between depository records and brokerage back-office systems were termed as serious compliance concerns because they may undermine the integrity of settlement processes and investor protection mechanisms.

Meanwhile, the BSEC also issued a warning to Navana CNG Limited and certain officials of the company for breaching securities rules, though no financial penalty was imposed in that case.

Stocks at the Dhaka bourse staged a notable rebound last week as improving investor sentiment and bargain hunting drove the key indices sharply higher amid easing concerns surrounding the ongoing Middle East war and its potential impact on the domestic economy.

The benchmark DSEX index of the Dhaka Stock Exchange surged 127 points, or 2.43%, to close the week at 5,368.

The blue-chip DS30 index also posted a strong gain, advancing 54 points, or 2.72%, to finish at 2,066.

Market breadth remained strongly positive during the week, with 324 issues advancing, 38 declining and 27 remaining unchanged.

Despite the broad-based price appreciation, market activity remained relatively subdued as investors adopted a cautious stance.

Average daily turnover fell by 24% week-on-week to Tk531 crore, reflecting a wait-and-see approach among market participants who preferred to monitor whether the upward momentum would be sustained before making fresh investment decisions.

However, the overall market capitalisation of the Dhaka bourse increased by approximately Tk9,000 crore during the week, indicating a steady return of confidence among investors after the previous week's sharp downturn.

EBL Securities, in its weekly market review, said the capital market experienced a sustained recovery throughout the week, bouncing back from the steepest single-day fall recorded in the past six years during the opening session. The brokerage house noted that the sharp correction at the start of the week created attractive entry points for investors, prompting bargain hunters to accumulate fundamentally strong stocks.

Although the week began under persistent bearish pressure, sentiment gradually improved as signals emerged of a possible de-escalation in the Middle East war.

At the same time, concerns regarding immediate disruptions to the country's fuel supply began to subside, which helped restore confidence among market participants.

A managing director of a leading brokerage firm said the government appeared capable of overcoming any potential fuel shortages stemming from the Middle East tensions.

Bangladesh secured a significant quantity of fuel supplies during the past week, which helped ease investor concerns and contributed to renewed optimism in the stock market.

He also noted that the central bank's recent decision to ease capital repatriation rules for foreign investors was a positive development for the capital market. The move is expected to improve the investment climate and may encourage greater participation from foreign portfolio investors in the coming months.

Additionally, speculation surrounding a possible change in the leadership of the stock market regulator also played a role in drawing investors back to the market, he added.

Sector-wise participation showed that investors were most active in the banking sector, which accounted for 21.3% of total market turnover. The pharmaceutical sector followed with 15.2%, while the textile sector captured 9.5% of the week's trading activity.

Among individual stocks, Islami Bank Bangladesh, LafargeHolcim Cement, City Bank, Square Pharmaceuticals and Beximco Pharmaceuticals were the major contributors to the upward movement of the benchmark index during the week.

In terms of turnover, Orion Infusion emerged as the most traded stock, followed by City Bank, Olympic Industries, BRAC Bank and Robi.

All major sectors posted positive returns during the week. The cement sector led the gains with a 7.6% increase, followed by the information technology sector with 5.3% and life insurance with 4.6%.

Interestingly, many Z-category stocks and loss-making non-bank financial institutions dominated the gainers' list. International Leasing, Peoples Leasing, FAS Finance and Fareast Finance each soared 50%, while Premier Leasing advanced 42.31%.

On the other hand, Saif Powertec was the worst-performing stock of the week, declining 6.94%. It was followed by Green Delta Insurance, Ring Shine Textile, Dula Mia Cotton and Hami Industries, which also posted notable losses.

Beximco Limited paid monthly profits to bond investors from the capital it had raised by offering high returns, rather than from business income, company officials have said.

With most of the raised funds used to repay loans and cover profit payouts, the company is now struggling to continue payments as the money has run out.

The company had assured investors a 15% return under the slogan "At the highest rate, above all", promising Tk1,250 per month for every Tk1 lakh invested. Investors were told that profits would be transferred to their bank accounts at the end of each month.

According to company sources, Beximco requires around Tk6 crore per month to pay interest against the bond capital.

However, since October last year, profit payments have become irregular. The profit for November was paid one week before the February national election, but payments for December and January are overdue.

In May 2024, the Bangladesh Securities and Exchange Commission (BSEC) approved Beximco Limited's issuance of bonds worth Tk1,500 crore to repay its own loans and to provide Tk1,000 crore in loans to Sreepur Township Company, a Beximco Group entity, for investment in real estate projects.

Sandhani Life Insurance Company Limited acted as trustee of the "Beximco 1st Unsecured Zero Coupon Bond".

However, according to Md Mizanur Rahman, company secretary of Sandhani Life Insurance, Beximco was able to raise only Tk541 crore out of the approved Tk1,500 crore. Of that amount, Tk500 crore was used to repay loans.

Beximco's Chief Financial Officer Md Luthfor Rahman said the remaining funds were kept in the company's account and used to pay monthly profits to investors.

He said as the factories are closed and bank accounts were frozen during the interim government, the company currently has no income of its own. As a result, a crisis has emerged in paying profits.

Mizanur Rahman said a meeting was held with Beximco before the election where the issuer assured that all outstanding profits would be paid.

He said that, to his knowledge, profits have been paid up to December and that the company has assured payment for January or the current month of February.

Individual investors have expressed concern.

Shipra Rani, an investor from Narsingdi, invested Tk60 lakh in the bond after selling land. She initially received profits regularly but is no longer receiving payments on time.

Her family told TBS that they depended on the monthly profit and are now facing uncertainty.

Another investor who invested Tk50 lakh said he is anxious about whether he will recover his principal investment at maturity.

Following the fall of the Awami League government, subscription to the bond declined sharply.

Institutional investors who had earlier expressed interest reportedly withdrew.

An official of Beximco, speaking on condition of anonymity, said the company had previously paid more than Tk100 crore per month in salaries and allowances but is now unable to pay investors' profits.

He said several thousand workers have been laid off and that many senior officials have not received salaries and allowances for over a year.

Although there were plans to provide Tk1,000 crore in loans to Sreepur Township, it is learnt that the loan was not provided from this bond. Sreepur Township had earlier undertaken the Mayanagar housing project in Gazipur.

Kaisar Ahmed, company secretary of Sreepur Township, said that after the change of government in August 2024, vandalism took place in the project area and work has not resumed fully.

He said machinery and equipment security remain a concern, although project activities are continuing.

He added that interest payments on the Tk1,000 crore bond raised earlier for the project are ongoing and there are no arrears.

Between 2021 and 2023, Beximco Group raised nearly Tk4,000 crore through two other bonds, including a Tk3,000 crore Sukuk bond in 2021 to finance solar power plants and expand its textile division.

The Bangladesh Bank has raised the maximum credit card limit from Tk25 lakh to Tk40 lakh in a move aimed at strengthening the country's digital payment ecosystem and meeting the growing demand of consumers.

The central bank issued a comprehensive set of guidelines in this regard today (15 March), which will take immediate effect for all scheduled banks and authorised card issuers.

According to the directive, the decision comes amid rapid growth in credit card usage, driven by technological advancement and increasing consumer preference for convenient digital transactions.

Exercising powers under Section 45 of the Bank Company Act, 1991, the central bank introduced the updated framework to ensure a more transparent and secure cashless payment ecosystem while safeguarding consumer rights.

Under the new guidelines, banks will be required to follow stricter risk assessment protocols to encourage responsible lending and prevent potential financial instability.

The framework also introduces revised mechanisms for handling customer complaints, card-related irregularities, and transaction disputes in order to ensure a safer digital environment.

In addition, all card issuers must comply with enhanced security measures for electronic Point of Sale (POS) systems and online transactions.

The central bank said that the expansion of electronic payment infrastructure and various incentive programmes has made it necessary to establish a more robust regulatory mechanism.

"To ensure that this growth contributes positively to financial stability and consumer confidence, it is imperative to establish a comprehensive and updated regulatory framework," the central bank said in its directive.

The policy is expected to boost consumer confidence and streamline the national payment system by making credit card services more fair, compliant and customer-centric, it added.

Loan limits against cards

The central bank has also raised the limits on loans against credit cards. Unsecured loans can now reach Tk20 lakh, up from Tk10 lakh, while secured loans have been increased to Tk40 lakh from Tk25 lakh.

Loan limits are based on the bank deposit linked to the card, providing secure collateral. Cardholders can also withdraw up to 50% of their total credit limit in cash.

Interest rates and charges

The policy sets the maximum interest rate on credit card loans at 25%, applied only to the outstanding balance, not the total billed amount. While interest-free facilities are available for purchases, cash withdrawals will not benefit from such concessions.

Late payment fees can only be applied once, and any changes in interest rates or other charges must be communicated to cardholders at least 30 days in advance, either in writing or electronically.

Consumer protection

Applicants must be at least 18 years old to obtain a credit card. Students aged 16 and above who are dependent on a primary cardholder may use supplementary cards.

Applicants must also provide a valid e-TIN certificate and a clear CIB report.

To prevent harassment and protect consumers, the policy specifies that banks and recovery agents cannot subject cardholders to mental or physical intimidation. The privacy of cardholders' families, friends, or references must also be respected.

Collection calls or in-person contacts are restricted to office hours. A 24-hour helpline must be available to promptly block lost or stolen cards.

The National Board of Revenue is set to remove restrictions preventing non-bonded exporters from sourcing raw materials locally through back-to-back letters of credit (LCs), a move expected to ease exports and improve access to inputs for hundreds of garment factories.

NBR Chairman Abdur Rahman Khan confirmed to The Business Standard that the board is actively working to remove these barriers.

"We are working to remove existing barriers preventing non-bonded exporters from sourcing raw materials from deemed exporters operating under bonded facilities," he said.

Officials at the revenue authority say an order on the matter may be issued soon after the necessary legal changes are completed.

Infograph: TBS
Infograph: TBS

A senior official of the NBR's VAT division, speaking on condition of anonymity, said a summary seeking approval from the finance ministry has already been prepared as part of the legal amendment process.

Once approved, the VAT Policy Division will issue a formal order, based on which the Customs Bond Wing will publish a separate order outlining the conditions under which the facility will operate.

If implemented, the measure is expected to benefit more than 1,100 ready-made garment exporters that currently operate without bonded licences but rely on locally sourced inputs for exports.

According to the Bangladesh Garment Manufacturers and Exporters Association, these factories export garments worth around $6.5 billion annually and employ nearly seven lakh workers.

Responding to concerns about possible irregularities once the facility is allowed, the NBR chairman said automation and integration of data systems would help reduce misuse.

"We are moving towards automation. With integration among relevant institutions, it will be possible to collect information and monitor activities, which will reduce the scope for irregularities," he said.

A long-standing bottleneck

Garment industry leaders have been lobbying the NBR for several years to resolve the issue.

When asked why these complexities had not been resolved sooner, a senior official from the NBR Customs Wing said, "It is relatively straightforward to identify irregularities when bond-licensed firms trade raw materials amongst themselves without exporting or by committing other breaches.

However, he said, detecting such issues when they supply raw materials to non-bonded institutions is difficult under the current system.

The official added, "This arrangement has persisted primarily due to a lack of capacity within Customs to detect these specific irregularities."

After the ouster of the government led by Sheikh Hasina in August 2024, the BGMEA raised the matter again. In a letter sent to the NBR on 30 November 2024, the association warned that more than a hundred factories had already shut down due to their inability to open back-to-back LCs or procure raw materials and accessories from bonded companies.

"The remaining factories are also losing capacity and are on the verge of closure," the letter read.

Exporters believe that the proposed decision will mark a significant step towards improving the ease of doing business in Bangladesh.

Md Shehab Udduza Chowdhury, vice president of BGMEA – who has been liaising with the NBR on behalf of the association for the past year to resolve this issue – welcomed the new initiative.

He said, "Discussions on this matter began back in 2021. Multiple committees were formed to solve the problem, yet no progress was made. Although the NBR took action after our letter 11 months ago, the process eventually stalled.

"It was only during a meeting two weeks ago that a final decision was reached."

Shehab added, "The question remains: if this could be resolved now, why did it take so long? Action should also be taken against those responsible for obstructing the process for so long."

Obstacles faced by non-bonded exporters

Under existing regulations, exporters holding bonded licences can collect yarn, fabrics or accessories from other bonded companies through back-to-back LCs against their master LCs. However, factories without bonded licences are not allowed to use this facility.

Exporters say banks often hesitate to open such LCs for non-bonded companies due to concerns over potential legal complications with the NBR.

As a result, many small exporters are forced to purchase raw materials and accessories in cash from the local market, often at higher prices.

During export procedures, customs authorities frequently ask for proof that VAT has been paid on those inputs. In addition, factories face further complications during annual VAT audits.

Consequently, non-bonded exporters often incur additional costs both in sourcing materials and in dealing with customs and VAT procedures, leaving them at a competitive disadvantage.

RL Apparels Limited, a knitwear exporter based in Badda in the capital, is one such company struggling under the current system.

Its Managing Director Md Rokonuzzaman told this newspaper that banks refuse to open back-to-back LCs due to the lack of permission under existing rules.

"As a result, we have to purchase raw materials and accessories from the open market in cash at higher prices," he said. "This increases our costs, and we also face difficulties during export clearance at ports and during VAT inspections."

According to him, the factory's workforce has already fallen from 160 to about 100 workers due to these challenges.

Rokonuzzaman noted that exporters of sweaters and woven garments without bonded licences face the most difficulties.

However, he said the removal of the restriction would significantly ease business operations for such factories.

Why exporters avoid bonded licences

Entrepreneurs say obtaining a bonded warehouse licence is often difficult for small and medium-scale exporters.

According to Rokonuzzaman, applicants must meet several strict conditions, including maintaining a specific warehouse size, having wide access roads nearby and holding paid-up capital of at least Tk1 crore.

"Even if these conditions are met, applicants often have to wait months or even years after submitting their application," he said.

Beyond these requirements, entrepreneurs have also alleged corruption in the process.

One garment exporter, requesting anonymity, said he had once planned to apply for a bonded warehouse licence but later learned that obtaining it would require paying around Tk30 lakh in bribes at different stages.

"If the bribe is paid, whether the conditions are actually met becomes less of a concern," he alleged.

According to NBR data, around 6,000 factories across sectors, including garments and plastics, currently enjoy duty-free raw material sourcing under the bonded warehouse facility.

Data from the Export Promotion Bureau shows that Bangladesh exports around 87 types of manufactured goods. In the 2024-25 fiscal year, total exports of manufactured goods amounted to about $48 billion, with more than 80% coming from the ready-made garment sector.

Tackling irregularities through automation

Officials said one of the key reasons the government had previously been reluctant to extend this facility was the risk that duty-free raw materials might be diverted to the domestic market instead of being used for exports, which could result in revenue losses and create unfair competition for regular importers.

However, NBR officials now believe the risk can be mitigated through digital monitoring systems.

A senior official said several government processes have already moved online, including the e-VAT system and the Customs Bond Management System.

These systems will be integrated enabling data sharing among customs, VAT authorities, banks and other relevant institutions.

"With online data sharing among the relevant institutions, it will become easier to track whether non-bonded companies are purchasing raw materials from bonded companies and whether those inputs are ultimately used for exports," the official said.

He added that such integration would significantly reduce the chances of false export declarations or misuse of duty-free inputs.

A prolonged US-Israel war on Iran could reduce Bangladesh’s gross domestic product (GDP) by as much as 3 percent over the next two years, according to a new policy analysis by the South Asian Network on Economic Modeling (Sanem).

The study says that Bangladesh’s heavy reliance on imported energy, remittances from Gulf countries, and global trade networks leaves the economy exposed to geopolitical shocks in the Middle East.

“Real wages could come under pressure and export growth would likely slow,” the report said.

The study was conducted by using the Global Trade Analysis Project (GTAP) computable general equilibrium model, a widely used analytical framework for assessing global trade and policy shocks.

Researchers modelled three scenarios to estimate the potential damage.

The first assumed a sharp rise in global energy prices, with crude oil and liquefied natural gas (LNG) prices climbing around 40 percent and 50 percent, respectively, if the conflict disrupts production or transport routes.

Higher fuel costs would push up domestic electricity generation costs, manufacturing expenses and consumer prices. Under such a situation, Bangladesh’s GDP is likely to decline by 1.2 percent, according to the paper.

“This contraction mirrors how central energy is to production and transportation throughout the economy. High fuel prices set off a chain reaction across industries, pushing production costs higher,” it said.

The second scenario examined disruptions to international trade and shipping routes, estimating a 25 percent rise in freight costs due to higher fuel prices and increased insurance premiums for vessels in high-risk maritime zones.

In this scenario, there could also be a 5 percent drop in export demand to the European and American markets. These shocks would altogether cause a 1.4 percent GDP decline, said the study.

The paper said Bangladesh’s export sectors are very sensitive to transport costs and delivery reliability.

“When exports shrink, the related backward linkages, such as textiles, logistics, and supporting services, decline. The economy, therefore, experiences a slowdown that spreads gradually through multiple layers of the production network.”

The third scenario combined several shocks at once, including a 10 percent fall in remittance inflows from Gulf countries, reflecting possible economic disruptions in the nations where millions of Bangladeshi workers are employed.

The combined shock scenario produces the largest effect, including a roughly 3 percent decline in GDP, said the paper.

Prof Selim Raihan, executive director of Sanem and author of the study, said these pressures combined could trigger moderate to significant economic stress in the short to medium term.

“This result is not surprising,” he said. “The effects reinforce each other when multiple external pressures come at the same time. Higher fuel prices raise production costs. Trade disruptions weaken export demand. At the same time, declining remittance inflows lower household income and consumption.”

“These forces work together, impacting the supply and demand sides of the economy. This is because rising costs and a weakening market mean firms cut back production. Households struggle with lower purchasing power and tighten their belts. The interaction between these changes generates a deeper slowdown than any of the shocks would create on their own.”

The paper said Bangladesh’s exports may decline by about 2 percent in the case of an energy price shock. This is because industries’ higher production costs can make Bangladeshi goods a little less competitive in international markets.

“This decline gets even larger when introducing trade disruptions. In the shipping disruption scenario, exports would shrink by about 3.4 percent. Freight costs and the uncertainty of logistics are significant here.”

In the combined scenario, however, that pressure is multiplied. Exports drop by nearly 6 percent, a sign of the cumulative effect of rising costs, reduced demand, and shipping disruptions, it added.

The report said Bangladesh’s export-oriented garments sector stands out as one of the most vulnerable sectors in both of the simulations. Its output may decline as much as 4.5 percent.

But the transport and logistics sector would be the worst hit, by as much as 5 percent, energy-intensive manufacturing 4 percent, and agriculture 1.5 percent, according to the findings.

Prof Raihan said in the case of a prolonged war, the effect could be felt in around two years. “In fact, the impact can be larger if the situation gets worse,” he said.

The paper said Bangladesh’s development model has relied on export-led manufacturing and overseas employment, but that same integration exposes it to external shocks when geopolitical crises erupt elsewhere.

The study recommends diversifying energy sources, improving trade logistics infrastructure, expanding export markets and broadening strategies for overseas employment.

Credit growth to the private sector has been staying around 6 percent as businesses continue to be shy about taking on fresh projects amid economic uncertainty.

In January, banks’ credit to the private sector grew by 6.03 percent, the lowest in at least five years. This makes it the eighth straight month of below 7 percent growth in credit demand.

The ongoing US-Israel war on Iran has already made oil and gas prices volatile and created fears of a ripple effect on the global economy and of stoking inflation. This has dampened the prospect of a sharp recovery in private sector credit demand and the much-needed spike in fresh investment.

“The Middle East crisis has made things volatile. It appears that the situation is not conducive. Under such circumstances, it is uncertain whether anyone would consider making fresh investments,” said Mati Ul Hasan, managing director of Mercantile Bank PLC.

Since the launch of US-Israel attacks on Iran in February, oil prices have soared. They hit nearly $120 per barrel last week as Iran effectively blocked the Strait of Hormuz, a key maritime chokepoint through which one-fifth of the world’s oil travels.

The price of Brent crude, the benchmark international oil contract, briefly dipped below $100 on Friday. It closed at $103.14 per barrel, and has soared by more than 42 percent since the start of the conflict, according to an AFP report.

Like other economies, the spike in oil prices, a key commodity, has also created concerns here, as Bangladesh meets 95 percent of its oil and 30 percent of its gas through imports.

The South Asian country imports over 60 percent of its crude oil from Saudi Arabia, the United Arab Emirates (UAE), Oman, Kuwait and Iraq. For liquefied natural gas, the country imports most of the energy from Qatar.

Worries have also increased because of the spike in shipping costs following the escalating war.

Hasan said the impact of the war has been visible in the foreign currency market. The taka has weakened against the US dollar.

“Our existing clients are worried about the risk of higher import costs,” he said.

“Businesses are in a stressful situation. They do not have the mindset to go for fresh investment now. They are likely to wait to see where things settle down.”

Bangladesh’s private investment fell for the third consecutive year, reaching 22.03 percent of gross domestic product (GDP) in the fiscal year 2024-25, the lowest level in 11 years.

The consistent slowdown in credit demand in the private sector means investment will remain subdued, the much-needed boost to the economy will be delayed, and there will be fewer jobs than required in the country.

Ashikur Rahman, principal economist at the Policy Research Institute (PRI) of Bangladesh, said that in periods surrounding national elections, it is quite common for entrepreneurs to delay major investment decisions until there is greater clarity regarding the political and policy environment.

As a result, demand for credit from the private sector tends to remain subdued. At the same time, banks have also become more cautious in extending loans because of concerns about asset quality and the broader macroeconomic environment, he said.

“Restoring confidence through political stability and credible economic reforms will therefore be critical for reviving private sector credit demand,” he said. However, the emerging geopolitical tensions have added another layer of risk to the macroeconomic outlook.

“Any escalation in the conflict in the Middle East could push up global oil prices and disrupt energy markets. For an energy-importing country like Bangladesh, this would increase the import bill, put pressure on the balance of payments, and complicate inflation management,” he added.

US Federal Reserve policymakers are expected to leave interest rates unchanged at their meeting next week, as the US-Israel war on Iran sends shock waves through markets and recent economic data has begun to show weakness.

The Fed will start its two-day meeting on Tuesday, with an announcement of the benchmark lending rate in the world's largest economy a day later.

The central bank cut rates three consecutive times last year before holding them steady at its January meeting.

It has a dual mandate of holding inflation near a long-term target of two percent while ensuring maximum employment.

With war in the Middle East causing global oil prices to spike, potentially increasing overall inflation and curbing growth, analysts say policymakers are unlikely to make any moves now.

"This is certainly a bind for the Fed, because supply shocks are extremely hard to deal with in that they lift inflation and they curb output," EY-Parthenon chief economist Gregory Daco told AFP.

Affordability is a key political issue for President Donald Trump, who has claimed that prices are cooling even as consumers complain of the high costs of basic goods.

Trump has repeatedly insulted Fed Chair Jerome Powell as he demands lower rates, and the Justice Department threatened Powell with a criminal indictment as part of an investigation into cost overruns for a Fed renovation project.

While consumer inflation has dropped from a peak of 9.1 percent during the Covid pandemic, it remains well above the Fed's two- percent target.

"Unlike other countries, which have already achieved some level of price stability, we're five years in without price stability," said Diane Swonk, chief economist at KPMG.

She warned that, depending on how long the Iran war lasts, inflation could again soar past four percent.

"I think the main story here is that we are seeing inflation moving away from the Fed's two-percent target, and that will lead many Fed policymakers to adopt an even more hawkish stance," said Daco.

Raising rates to cool the economy, however, could bring the Fed into tension with its other mandate: managing unemployment.

The United States unexpectedly lost 92,000 jobs in February, government data showed, while the unemployment rate rose to 4.4 percent.

Analysts say a relatively steady unemployment rate has been masking churn beneath the surface.

Labor demand has been dropping, but unemployment has not spiked because that has been accompanied by a drop in supply due to Trump's immigration crackdown.

Daco said labor demand gauges were showing signs of concern, including a weak hiring rate "at a decade low," slowing wage growth and business leaders talking about labor replacement due to AI.

Swonk noted that spiking uncertainty due to war in Iran and its knock-on effects would further curb labor demand.

"Uncertainty acts as its own tax on the economy, and one of the first lines of defense that firms do is they freeze hiring," she said.

And recent data ahead of the Fed meeting is not encouraging, with US GDP growth revised sharply lower in the final months of 2025.

Some Fed policymakers, however, have been cautious in describing the possible inflationary shocks of the war.

Fed Governor Christopher Waller expressed sympathy on Bloomberg TV last week for consumers facing spiking gasoline prices.

"But for us thinking about policy going forward, this is unlikely to cause sustained inflation," he said.

Swonk warned, however, that any economic slowdown from the war could be tough to recover from in the immediate term.

"I think people are discounting the risk of the lingering effects," she said, noting that supply disruptions affect more than oil prices.

"There's no question they're between a rock and a hard spot, and it just got harder," Swonk said of policymakers having to balance inflation and unemployment.

To Daco, however, uncertainty means the Fed is more likely to hold rates steady "for a long period of time."

Traders have begun to reduce their outlook for rate cuts, and Swonk said that hikes could even be on the menu.

"This is not a one-way street. We're at a busy intersection, and the stoplight's broken," she said.

Oil loading operations ‌at the United Arab Emirates' Fujairah emirate, a major bunkering hub ​and crude export terminal, have ​resumed following a drone attack ⁠and fire on Saturday, ​a Fujairah-based industry source told Reuters.

Fujairah, ​outside the Strait of Hormuz, is the outlet for about 1 million barrels ​per day of the ​UAE's Murban crude oil - a volume equal ‌to ⁠about 1% of world demand.

Abu Dhabi state oil giant ADNOC, which operates in the emirate, ​did ​not immediately ⁠respond to a request for comment.

Bloomberg News ​earlier reported the resumption ​of ⁠oil loading operations in the emirate.

The proposed merger between listed electronics manufacturer Walton Hi-Tech Industries and non-listed technology company Walton Digi-Tech Industries has moved a step closer after the securities regulator issued a formal clearance.

According to a disclosure made today (15 March), the Bangladesh Securities and Exchange Commission issued a No Objection Certificate regarding the merger.

Under the proposed scheme, Walton Hi-Tech Industries will act as the acquiring company, while Walton Digi-Tech Industries will be the acquiree. The merger will become effective after receiving approval from the High Court Division of the Supreme Court, along with consent from creditors, general shareholders, and other relevant regulatory authorities.

The merger is aimed at expanding business operations, reducing operational costs, improving efficiency, and strengthening Walton's competitive position in the technology and electronics sector.

For this purpose, a Memorandum of Understanding was signed between the two Walton Group companies on 3 September 2025. On the same day, Walton Hi-Tech's 46th board meeting approved the memorandum.

On the Dhaka Stock Exchange, Walton Hi-Tech's share price closed at Tk385.40 yesterday, reflecting a marginal decline of 0.46%.

According to the company, the merger will add a wide range of high-tech products to Walton Hi-Tech's portfolio, including laptops, desktop computers, mobile phones, printed circuit boards, and electric bikes.

This integration is expected to significantly enhance the company's operational capacity, broaden its market reach, and lower operational costs. Industry insiders say the move could also strengthen Bangladesh's electronics manufacturing ecosystem and help position the country as a hub for high-tech and digital product manufacturing.

Currently, Walton Digi-Tech produces and markets 123 types of high-tech products and accessories, including laptops, desktop computers, printers, mobile phones, printed circuit boards, and electric bikes. It is the only company in Bangladesh with manufacturing facilities for both mobile phones and printed circuit boards

Stocks at the Dhaka bourse fell today (15 March), ending a four-session rally as cautious investors returned to the sidelines amid persistent uncertainty over the ongoing Middle East conflict.

The benchmark DSEX index of the Dhaka Stock Exchange (DSE) dropped 49 points, or 0.91%, to close at 5,319, while the blue-chip DS30 index lost 23 points, or 1.11%, settling at 2,043.

Market breadth remained sharply negative, with 246 issues declining, 99 advancing, and 45 unchanged.

Trading activity also slowed, with daily turnover falling 11% to Tk523 crore, reflecting a cautious stance among investors preferring to observe market developments rather than take fresh positions.

According to EBL Securities, the benchmark retreated after a brief recovery streak as investor sentiment weakened amid lingering global uncertainties.

"Investors adopted a cautious stance, leading to broad-based selling pressure across the board," the brokerage noted, highlighting concerns over the geopolitical conflict's impact on both domestic and global markets.

Throughout the session, selling pressure spread across most sectors, and many risk-averse investors remained inactive, monitoring the market amid the absence of any visible progress toward a resolution or ceasefire.

Sector-wise, banking led trading activity, accounting for 17% of total turnover, followed by pharmaceuticals at 15.6% and textiles at 10.4%. Top turnover leaders included Orion Infusion, City Bank, Robi, Summit Alliance Port, and BRAC Bank.

Most sectors posted losses, reflecting broad-based selling. Life insurance recorded the steepest decline at 1.9%, followed by general insurance (-1.5%) and banking (-1.4%). Only the financial institutions sector managed a marginal gain of 0.3%.

Among individual stocks, Aamra Technologies led the gainers with a 9.77% rise, followed by Metro Spinning (+9.67%), Pacific Denims (+9.25%), Prime Finance (+9.25%), and International Leasing (+9.09%). On the losing side, ICB Islamic Bank fell 5.71%, Sonar Bangla Insurance dropped 5.03%, Sunlife Insurance lost 4.66%, Sea Pearl Beach Resort shed 4.51%, and Meghna PET declined 4.40%.

Bangladesh Bank Governor Md Mostaqur Rahman has invited the World Bank to expand its engagement in supporting Bangladesh's financial sector development and broader economic growth.

The call came during a meeting with a high-level World Bank delegation at the central bank's head office on Sunday (15 March).

The delegation was led by John Zutt, regional vice president of the World Bank, and included Jean Pesme, division director for Bangladesh and Bhutan; Imad Najib Ayed Fakhoury, director at the International Finance Corporation; Gayle H Martin, operations manager for Bangladesh and Bhutan; Wilfred Tamegon, manager at the International Finance Corporation; and Mehrin A Mahbub, senior external affairs officer.

Deputy governors Md Habibur Rahman and Md Kabir Ahmed, along with other senior officials of Bangladesh Bank, were also present at the meeting.

During the meeting, both sides discussed ongoing projects supported by the World Bank in Bangladesh and explored opportunities to strengthen future cooperation, particularly in the financial sector.

Governor Mostaqur Rahman reaffirmed the central bank's commitment to ensuring the successful implementation of the projects. He also appreciated the World Bank's continued support for Bangladesh's development initiatives.

The World Bank delegation expressed strong interest in maintaining close cooperation with Bangladesh and highlighted the importance of a constructive partnership in supporting the country's development priorities.

The meeting also included discussions on Bangladesh's overall economic outlook and future development prospects.

Remittance inflows have increased by 35.7% in the first half of March, ahead of Eid, with expatriate Bangladeshis sending $2.20 billion in the first 14 days of the month.

During the same period in 2025, remittances stood at $1.62 billion, confirmed the central bank's spokesperson and Executive Director Arief Hossain Khan today (15 March).

A senior official of a private bank told The Business Standard that the rise in remittances is mainly due to the upcoming Eid festival, as expatriates typically send more money home during this period.

However, he noted that the flow may slow down after Eid, which is a usual trend.

He also warned that the ongoing Iran-Israel conflict could affect remittance inflows from the Middle East after Eid. If migrant workers in the region face disruptions in their jobs due to the conflict, remittance sent through banking channels may decline.

A deputy managing director of another private bank said expatriates were receiving between Tk121.70 and Tk121.75 per dollar today, while LC settlements were made at Tk121.20 per dollar.

The Middle East conflict escalated on 28 February this year when Israel and the United States jointly attacked Iran. In response, Iran has launched a series of missile strikes targeting Israel and countries in the Arab region that host US military bases.

Iran has also restricted vessel movements through the Strait of Hormuz without its approval, contributing to a rise in global fuel prices.

Meanwhile, economists recently held a meeting with newly appointed Bangladesh Bank governor last week. According to sources at the meeting, the central bank signalled that it would try to maintain foreign exchange reserves.

This has created a market signal that prompted banks to buy remittance dollars at higher rates.

A senior official of a private bank said that if new investments increase in the coming months, demand for opening letters of credit (LCs) will rise, which would in turn push up demand for dollars in the banking sector. As a result, banks are currently purchasing remittance dollars at higher rates.

Oil prices could extend gains at Monday's open as the US-Israeli war against Iran entered a third week, putting oil infrastructure at risk and keeping the Strait of Hormuz shut in the world's largest supply disruption.

US President Donald Trump threatened further ​strikes on Iran's Kharg Island oil export hub, drawing a defiant response of further retaliation ​from Tehran.

Brent and US West Texas Intermediate crude futures have already spiked sharply and ⁠rattled global financial markets. Both contracts have surged more than 40% so far this month to their ​highest levels since 2022 after the US-Israeli attacks on Iran prompted Tehran to halt shipping through the Strait ​of Hormuz - a key chokepoint for a fifth of global oil supply.

Trump has urged China, France, Japan, South Korea, Britain and others to deploy warships to secure the strategic gateway.

The United States struck military targets on Kharg Island on Saturday, which was swiftly ​followed by Iranian drone attacks on a key oil terminal in the United Arab Emirates.

"This marks an escalation ​in the conflict," JP Morgan analysts led by Natasha Kaneva said.

"Until now, the region's oil infrastructure has largely been spared."

Besides ‌UAE's ⁠Fujairah, Saudi Arabia's Ras Tanura export terminal and Abqaiq oil processing facilities have been listed as critical and highly vulnerable energy nodes in the Gulf, the analysts said.

However, oil loading operations at Fujairah have resumed, a Fujairah-based industry source told Reuters on Sunday.

Fujairah, outside the Strait of Hormuz, is the outlet for about 1 ​million barrels per day ​of the UAE's flagship ⁠Murban crude oil - a volume equal to about 1% of world demand.

Global oil supply is expected to fall by 8 million bpd in March due to disruptions ​to shipping while Middle Eastern producers have cut output by at least ​10 million bpd, ⁠according to the International Energy Agency.

Last week, the IEA agreed to release a record 400 million barrels of oil from strategic stockpiles held by member nations to combat price spikes. Japan plans to start releasing its oil on ⁠Monday.

Meanwhile, the ​Trump administration has rebuffed efforts by Middle Eastern allies to start ​diplomatic negotiations, according to three sources familiar with the efforts, while Iran has rejected the possibility of any ceasefire until U.S. and ​Israeli strikes end, dimming hopes of a quick end to the conflict.

The Bangladesh Securities and Exchange Commission (BSEC) and the Asian Development Bank (ADB) have charted a transformative course to quadruple the size of the national capital market, aiming to elevate its contribution from the current 10 percent of GDP to at least 40 percent within the next three years.Bangladesh Investment Guide

In a high-level meeting held on March 9, at the BSEC office in Agargaon, both organizations deliberated on strategic reforms, digitalization, and market diversification to ensure long-term sustainable growth for the country’s financial ecosystem, BSS reports citing a press release on Sunday.

To provide a data-driven foundation for this massive expansion, BSEC announced plans to conduct a comprehensive "Capital Market Diagnostic."

This initiative is designed to identify structural bottlenecks and formulate evidence-based policies for long-term development.

The meeting underscored a clear mandate: to transition the capital market from its current state to a dominant pillar of the economy, setting an ambitious target of reaching a market-to-GDP ratio of 40 percent by 2029.

The meeting emphasized the urgent need to align national market governance with the International Organization of Securities Commissions (IOSCO) standards to attract global institutional investors.

BSEC highlighted its commitment to using its full legal authority under existing frameworks to create robust incentives for listing.

In the short term, the Commission is prioritizing the digitalization and automation of market processes to eliminate opacity and ensure absolute accountability.

This modernization drive, coupled with a focus on human resource development, is intended to rebuild and strengthen investor confidence in the regulatory environment.

A central theme of the discussion was the necessity of shifting the burden of long-term industrial financing away from the banking sector and toward the capital market.

To facilitate this, BSEC and Bangladesh Bank (BB) are developing a joint framework to encourage large borrowers to raise capital through the stock exchange rather than relying on bank loans.

Under this initiative, BSEC is exploring specific incentives to encourage companies with significant market share to list their shares.

Furthermore, the introduction of a "Bond Guarantee Fund" was discussed as a vital security mechanism to mitigate risk and attract a broader spectrum of investors to the fixed-income market.

The ADB delegation expressed strong interest in providing technical assistance to drive these priority reforms.

Specifically, the ADB has committed to supporting feasibility studies for the proposed "Bond Guarantee Fund" and assisting BSEC in identifying the most appropriate government agency to manage and implement the fund.

The ADB representatives expressed optimism that this joint partnership would successfully build a more transparent, robust, and investor-friendly market.

BSEC Chairman Khondoker Rashed Maqsood presided over the meeting.

The high-level representation included Farzana Lalarukh, Commissioner; Md. Abul Kalam, Director; and Syed Muhammad Golam Mowla, Joint Director.

The ongoing Middle East crisis has sharply reduced air cargo export capacity, pushing freight rates to double and in some cases nearly triple over the past two weeks.

In addition to higher costs, flight disruptions have also prolonged delivery times due to a significant capacity crunch, according to industry insiders.

Before the conflict began, airlines charged around $2 to $2.2 per kg for shipments to European destinations. Those rates have now surged to $5.5 to $6 per kg as demand rises amid limited cargo space, according to data from the International Air Express Association of Bangladesh (IAEAB).

Freight rates to the United States have also increased, rising from about $4.50-$5 per kg to roughly $7-$8 per kg, the data shows.

IAEAB President Kabir Ahmed told TBS that cargo operations have dropped significantly due to flight disruptions.

"Normally, around 600-700 tonnes of cargo were handled daily. Now it has fallen to about 300-350 tonnes per day. Previously it took two to three days to move cargo, but now it is taking six to seven days. As a result, cargo is piling up at the airport, creating space constraints," he said.

He added that the high freight rates and capacity shortages may persist for at least the next two weeks. "However, if the conflict prolongs, the impact could become even more severe," he warned.

Typically, about 60% of Bangladesh's air cargo is shipped through Middle Eastern hubs like Dubai and Doha. However, nearly half of the flights to those destinations remain suspended, according to data from the Civil Aviation Authority of Bangladesh (CAAB), leading to reduced cargo export capacity.

Airport sources said flight disruptions on Middle East routes started on 28 February and the total number of cancelled flights had reached 447 as of 13 March.

Major carriers such as Emirates, Etihad, Flydubai, Air Arabia, Qatar Airways, Gulf Air and Saudia Airlines – all based in the Middle East – have suspended many of their flights for days.

Biman Bangladesh Airlines, the national flag carrier that transports a significant portion of cargo, also suspended flights to several Middle Eastern destinations after the conflict began, further worsening the capacity shortage.

Since Bangladesh has no direct flights to the United States or Europe, it is heavily dependent on these transit hubs.

Meanwhile, airlines operating routes to the US and Europe that bypass the Middle East – including Turkish Airlines, Malaysia Airlines, Thai Airways, Cathay Pacific and Singapore Airlines – have raised their freight charges.

Europe accounts for about 56% of Bangladesh's air cargo exports, while roughly 22% goes to the United States.

Nasir Ahmed Khan, a former director of the Bangladesh Freight Forwarders Association, told TBS that the country largely relies on passenger flights to carry cargo.

"Most of our cargo moves through passenger carriers. Dedicated freighter services have also been reduced. Now only one scheduled freighter flight arrives per week. Some non-scheduled freighters are operating, but the numbers are not sufficient," he said.

Bangladesh's exports have already been in negative territory for seven consecutive months, weighed down by weak demand in the United States and the European Union. The Iran conflict now threatens to add further pressure.

Arab countries accounted for nearly $900 million of Bangladesh's exports in FY25, representing around 2% of the country's total exports. However, they remain important markets for certain sectors.

More than 60% of these exports are garments, while the rest mainly consist of vegetables and other agro-products.

Any prolonged disruption in the region could therefore affect both industrial exports and shipments of perishable goods from Bangladesh.

Bangladeshi apparels are fetching over 10 percent higher prices in European markets on average compared to the United States, even for similar products, according to a recent study by the Research and Policy Integration for Development (RAPID).

The study, unveiled yesterday by the local think tank in Dhaka, links the price gap to differences in tariff structures and trade preferences, with exporters benefiting from lower tariffs in Europe while facing higher barriers in the US.

RAPID said the research was based on transaction data from nearly 3,000 exporting firms collected by the customs department of the National Board of Revenue between 2010 and 2023.

It found that about 45 percent of these garment factories export to both the US and EU markets. For major products, prices in the EU consistently exceed those in the US.

On average, leading exporters fetch 5-18 percent higher prices in the EU than the US for major 10 apparel products, it states. T-shirts, for instance, earn 20-27 percent higher prices in Germany than in the US, while trousers fetch 9-15 percent more.

Presenting the findings, Jillur Rahman, deputy director at RAPID and lecturer in development studies at Dhaka University, said, “The gap remains significant even after accounting for product type, firm size, and technological intensity.”

He also highlighted differences in pricing strategies across preferential and non-preferential markets.

“High US tariffs compel exporters to absorb a significant share of the tax burden within their own margins to remain competitive at the border,” Rahman noted.

“The findings are particularly important as Bangladesh prepares to graduate from the least developed country (LDC) category,” he added.

Currently, duty-free access to the EU helps exporters secure better prices. But once Bangladesh graduates, some of these trade preferences may gradually erode, he said.

“The industry will need to strengthen competitiveness by improving product quality, diversifying into higher-value apparel segments and enhancing technological capabilities,” he noted.

Without such upgrades, he said exporters may face growing pressure on prices and margins in global markets, especially in destinations where Bangladesh lacks preferential trade access.

Abdur Rahim Khan, additional secretary of the Ministry of Commerce, said in the past 50 years, the country has failed to develop alternative markets or product competition, and now needed export-driven investment

“If we graduate from LDC status without proper preparation and preferential market access, it will deal a major blow to both the country’s economy and social structure,” he added.

Doulot Akter Mala, president of the Economic Reporters Forum, added, “The biggest problem of our ready-made garments industry is that we have put all our eggs in one basket. Lack of diversification in products and markets makes us vulnerable whenever instability arises in the US or European markets.”

Md Hafizur Rahman, adviser on trade policy and trade facilitation at the World Bank, said, “Bangladesh needs to move from being a low-cost or low-price brand to a high-price brand. This will increase pricing power and competitiveness in international markets.”

Bangladesh's construction materials market is facing rising prices, with the cost of key inputs such as steel rods and cement increasing sharply in recent days.

Over the past 10 days, steel rod prices have risen by up to Tk10,000 per tonne, while cement prices have increased by Tk20-25 per bag, according to market data.

Industry players say higher import costs – particularly for scrap and freight – driven partly by tensions in the Middle East, along with a gradual increase in construction activity after the national election are pushing prices upward.

Rod prices climb sharply

According to market sources, 75-grade mild steel rods are selling at Tk90,000 to Tk95,000 per tonne at the mill gate level. Ten days earlier, the same grade was priced between Tk80,000 and Tk83,000 per tonne.

Among major brands, BSRM rods are selling at around Tk95,000 per tonne, KSRM at Tk91,000, GPH at Tk92,000 and AKS at about Tk92,500.

Steel, rod get costlier

Prices of 60-grade rods have also risen significantly. They have increased by around Tk9,000 per tonne within 10 days and are now selling between Tk87,000 and Tk88,500.

Brands such as HM Steel, BSL and ZSRM are selling at around Tk89,000 per tonne, while Al-Aksa, Montaha, Kadamtali, DSRM and JSRM are priced around Tk88,000. Fresh, IRML and HKG rods are selling at approximately Tk87,000 per tonne.

The four dominant brands in the local market – BSRM, Abul Khair Steel (AKS), GPH and KSRM – have all raised prices significantly since tensions escalated in the Middle East.

Before the conflict, their rods were priced between Tk81,000 and Tk85,000 per tonne. Most of these brands have since increased prices by roughly Tk8,000 to Tk10,000 per tonne, while medium-range brands have also raised prices significantly over the same period.

Sudip Ghose, owner of Prime Steel, a rod dealer in Chattogram's Madarbari area, said prices began rising soon after tensions escalated in the Middle East.

"Large brands have raised rod prices by about Tk10,000 per tonne in the past 10 days," he said.

Cement prices also rise

Cement prices have also increased after remaining largely stable for months.

Mohammad Shahjahan, an agent of Confidence Cement's Rajmistri Green brand, said almost all cement brands raised prices by Tk20-25 per bag within the past three days.

Market sources say Ruby Cement is selling at around Tk520 per bag, while Confidence and Diamond brands are priced at Tk500. Royal Cement is selling at Tk495, Seven Rings at Tk490, Rajmistri at Tk480 and Premier Cement at Tk475.

Petrobangla seeks up to Tk26,000cr extra subsidy to keep gas flowing

Industry officials say cement producers were forced to sell below production cost for nearly a year and a half due to weak demand in the construction sector.

Mohammad Amirul Haque, managing director of Premier Cement Mills PLC and president of the Bangladesh Cement Manufacturers Association (BCMA), said the latest price adjustments have helped partially align market prices with production costs.

"For nearly one and a half years, we had to sell cement below production cost because of the stagnant market," he said. "The recent increase has allowed some commercial adjustment between costs and selling prices."

Raw material and freight costs behind the hike

Industry leaders attribute the recent price increases to a combination of stronger domestic demand and rising import costs.

Bangladesh depends heavily on imported raw materials for both steel and cement production. The Middle East conflict has pushed up global fuel prices, which in turn raised shipping costs.

As a result, the cost of importing steel scrap – the primary raw material for rod manufacturing – and clinker, the key ingredient for cement, has increased.

Iran says ceasefire depends on US and Israel promising no future attacks

BCMA President Amirul Haque said clinker booking prices in the international market have risen significantly.

"Import costs have increased due to higher freight costs, so we had to adjust cement prices accordingly," he said.

Scrap prices and supply pressure

Steel producers say global scrap prices have also increased sharply.

The cost of imported scrap has risen by about $50 per tonne, or roughly Tk6,000. Although shipments at the higher prices have not yet reached Bangladesh, the impact is already visible in the domestic market.

Prices of scrap from Bangladesh's shipbreaking industry – another major source of raw materials – have climbed by around Tk3,000 per tonne, reaching about Tk58,000, according to market data.

Shipping costs have also increased substantially. The cost of importing scrap to Chattogram, including freight, has increased from about $360 per tonne to roughly $410 per tonne.

Iftekhar Ahmed, country head of Singapore-based scrap exporter Jaguar Resources and Capital, said freight costs surged sharply after tensions in the Middle East intensified.

"Scrap prices were already rising somewhat before the conflict," he said. "But shipping costs increased abnormally after the situation escalated, forcing suppliers to reconsider new offers."

Govt seeks energy assistance from India amid Middle East war

Mohammed Jahangir Alam, president of the Bangladesh Steel Manufacturers Association and chairman of GPH Ispat Limited, said many companies had been selling rods below production cost for a long time due to weak demand.

"The ongoing conflict in the Middle East has pushed up global fuel prices, shipping costs and the price of scrap – the main raw material used in rod production. At the same time, the dollar has been strengthening," he said.

"To cope with these additional costs, rod prices have been adjusted," he added.

Factories restart as demand rebounds

Industry insiders say the construction sector had remained sluggish for more than a year and a half, largely due to political uncertainty that slowed both government and private projects.

At one point, rod demand fell by nearly 50%, forcing several steel plants to halt operations.

In Chattogram alone, factories such as Golden Ispat, Baizid Steel, Sheema Steel, Sitalpur Steel and SS Steel had suspended production for extended periods.

Stocks surge as war-driven demand boosts global defence firms

However, industry players say the situation has begun to improve following the election.

Mohammad Sarwar Alam, director of HM Steel, said sales of MS rods have increased over the past two weeks as political stability returned after the election.

"Factories that had been operating at a loss are now seeing some relief," he said.

Oil prices stayed over $100 per barrel Friday while stock markets slid, with no end in sight to disruption in crude supplies as war rages on in the Middle East.

With the conflict heading toward its third week, equity markets continued falling amid investor worries of an extended crisis that could fan inflation and hammer the global economy.

The price of Brent crude, the benchmark international oil contract, dipped below $100 during the day, sending equities briefly higher.

But stocks slid back into the red as Brent climbed back above the $100 mark.

It closed at $103.14 per barrel, and has soared by more than 42 percent since the start of the conflict.

US-Israeli strikes on Iran on February 28 plunged the Middle East into war, sparking a surge in fuel prices as Tehran vowed to choke the Strait of Hormuz -- a critical artery for global energy transport.

"Crude oil is continuing to dictate direction for markets as we head towards the end of a volatile week," said Fawad Razaqzada, market analyst with Forex.com.

"The pressure remains with no end in sight in the Middle East conflict," Razaqzada added.

"Traders are trying to figure out what a fair value for crude oil is right now, given the big release of emergency oil reserves, and the temporary relaxation of sanctions on Russian oil sales that's already at sea," he said.

Iran's threats over the Strait of Hormuz, through which a fifth of global crude oil and liquefied natural gas passes, is causing worries of rising prices rippling through the world economy.

"Fears of a burgeoning energy crisis remain front and center for investors," noted Joshua Mahony, chief market analyst at Scope Markets.

"Inflationary fears are particularly prevalent," Mahony added.

Major central banks, which prior to the war's outbreak were heavily forecast to keep cutting interest rates, are now widely expected next week to freeze borrowing costs or even hike them to keep a lid on inflation.

An unprecedented seven central banks are due to hold meetings on interest rates next week.

Investors also digested updated US economic growth data for the fourth quarter, which was revised down to 0.7 percent from an initial reading of 1.4 percent.

And delayed data showed the US Federal Reserve's preferred inflation gauge had dipped to 2.8 percent in January.

This is still higher than the Fed's two-percent inflation target, and reflects a period before energy prices shot higher.

The US central bank now faces an environment where inflation remains sticky and could soon be boosted by energy prices, while GDP growth and the labor market continue to lose momentum, said eToro US Investment Analyst, Bret Kenwell.

On foreign exchange markets, the dollar held gains against major rivals owing to its safe-haven status and expectations that US interest rates will remain elevated longer than expected.

AJ Bell investment director Russ Mould said next week's central bank meetings "come at a delicate time."

"Markets will be watching closely for any signals on how they plan to deal with surging oil and gas prices and whether they see it as a short-term bump to look through."

A tanker's sudden change of course in early March reflects a shift in Russia's energy fortunes.

From 22 to 26 February, the Hong Kong-flagged tanker Sarah turned off its transponders to load Russian oil from smaller ships off the coast of Oman. It then headed towards Singapore, where the cargo was likely to be transferred to another vessel bound for China.

But on 6 March, a day after the United States issued a 30-day sanctions waiver allowing Indian refiners to buy Russian crude, the tanker changed course. It is now scheduled to arrive at a refinery in western India today (14 March), reports The Economist.

The change reflects a wider shift since the start of the Iran war. The de facto closure of the Strait of Hormuz has trapped around 15% of global oil supply in the Gulf.

Brent crude, the global oil benchmark, fell to $59 a barrel in December amid expectations of oversupply. It is now around $100. Higher prices have made Russian oil more attractive to buyers. On 12 March, the United States extended its waiver to allow countries to purchase Russian oil that had already been loaded onto tankers.

Before the crisis, Russia's oil revenues had been declining. Many refiners in India and China, Russia's largest customers, stopped buying Russian crude around November before US sanctions on Rosneft and Lukoil took effect.

By February, Russia's export volumes had fallen by about a fifth. Together with lower prices, this meant the Kremlin's oil-and-gas revenues were 44% lower than a year earlier. In the first two months of the year, Russia's budget deficit reached 3.4 trillion roubles, about nine-tenths of its target for the whole of 2026.

Higher prices and renewed demand are now helping reduce a backlog of Russian oil shipments at sea. India has increased its purchases by about half, helping cut Russia's floating oil inventory by more than 10% to around 122 million barrels. China's imports have also risen.

Because these shipments had already been sold, the immediate financial benefit goes mainly to traders rather than the Russian government.

The absence of Gulf oil has increased demand for alternative supplies. Russian crude is similar in quality to Middle Eastern oil and easier for many Asian refineries to process. Urals crude delivered to India, which had previously been sold at a discount, is now priced above Brent.

Sergey Vakulenko, a former executive at Gazprom Neft, estimates that every $10 increase in Brent prices over a month raises Russia's energy export revenues by about $2.8 billion, of which roughly $1.6 billion goes to the state.

The crisis has also complicated efforts by Western countries to tighten sanctions on Russia. Before the conflict, the United States had considered tougher measures against Russia's "shadow fleet" of tankers and possible secondary tariffs.

The recent waivers have also widened differences with the European Union. The European Commission had proposed a ban on maritime services for Russian oil exports, but the plan faces opposition from Hungary and Slovakia.

Concerns over energy supply may also lead some European countries to reconsider plans to stop importing Russian liquefied natural gas next year.

China, which receives about one-third of its liquefied natural gas from the Gulf region, is also concerned about supply disruptions. This may increase interest in overland energy supplies from Russia, including the proposed Power of Siberia 2 pipeline, a 2,600-kilometre project that could significantly increase Russian gas exports to China.

Despite higher prices, analysts say Russia's gains may be limited. Ukrainian attacks on oil facilities, sanctions and reduced investment have weakened the industry.

Russia is estimated to have about 300,000 barrels per day of spare production capacity, far below the 10–15 million barrels per day of supply affected by disruptions in the Gulf.

Analysts also say Russia's oil output is likely to decline over time. Higher prices may provide temporary relief, but they are unlikely to reverse the longer-term pressures on Russia's energy sector.