Steel manufacturer GPH Ispat has reported an 86% year-on-year decline in profit in the first half of Fiscal Year (FY) 2026, citing a sharp fall in revenue alongside persistent operating and finance costs.

According to the company's financial statements, earnings per share (EPS) fell to Tk0.09 in the July–December period, down from Tk0.65 in the same period of the previous FY, blaming the lower sales volumes, which, combined with fixed operating and financing expenses.

In the second quarter alone (October–December), EPS dropped 92% year-on-year to Tk0.04, compared to Tk0.51 in the corresponding quarter of FY25.

The weak half-year performance follows GPH Ispat's first-ever annual loss since its stock market debut in 2012.

In FY25, which ended in June, the Chattogram-based steelmaker posted a loss of Tk24.68 crore, reversing a profit of Tk85.77 crore recorded in FY24. Rising production costs and escalating finance expenses were key factors behind the loss.

Despite the setback, GPH declared a 5% cash dividend for general shareholders for FY25, its lowest payout since listing. The company had paid a 10% cash dividend in FY24, while its highest dividend was 20% in FY21.

In October 2024, GPH sought approval to issue Tk500 crore in preference shares to reduce high-cost debt, but the Bangladesh Securities and Exchange Commission (BSEC) rejected the proposal.

Earlier, the regulator also turned down the company's plan to raise Tk242 crore through a rights issue aimed at capacity expansion.

The International Monetary Fund on Friday said Bangladesh's gross domestic product is expected to rebound to 4.7% in the fiscal year 2026, following a recent economic slowdown.

"With implementation of policies to mobilize tax revenue and address financial sector vulnerabilities, (Bangladesh's) growth is projected to rebound to 4.7 percent in FY26 and gradually accelerate to around 6 percent over the medium term," the IMF said.

"Inflation is projected to remain elevated at 8.9 percent in FY26 before subsiding to around 6 percent in FY27," it added in a statement.

Bangladesh Bank is about to announce its Monetary Policy Statement for the rest of FY26. Once again, a familiar question has surfaced: should it cut the policy rate and begin easing monetary conditions?

The pressure is understandable. Headline inflation has come down from its peak, the real policy rate is positive, and private investment remains weak. Business groups are lobbying hard for cheaper credit. On the surface, a rate cut looks like the obvious—and politically attractive—next step.

But a closer look—based on monthly data from July 2019 to October 2025—at how inflation actually behaves in Bangladesh, how it rises, how it spreads across sectors, and how it eventually cools, suggests that cutting rates now would risk reigniting inflation through the exchange rate, slowing disinflation rather than supporting durable growth.

What makes inflation persistent

Headline CPI inflation in Bangladesh is persistent, but not explosive. When inflation rises, it tends to remain elevated for many months, continuing to erode household purchasing power long after the initial shock. At the same time, inflation does not spiral indefinitely. Over time, it drifts toward a level shaped by underlying price dynamics rather than short-term demand fluctuations.

Those dynamics are dominated by food prices. Food inflation sits upstream in Bangladesh's inflation process and is the primary source of persistence in headline inflation. This is why inflation often remains stubborn even as macroeconomic conditions tighten.

Food inflation is highly inertial. Roughly 85 percent of a food price shock carries over from one month to the next, imparting substantial stickiness to headline inflation. Prices also adjust asymmetrically: food prices rise quickly when shocks hit—whether from supply disruptions, policy frictions, or global price movements—but fall back only slowly when conditions improve.

Crucially, food inflation appears largely insulated from standard macroeconomic levers. It does not respond systematically to domestic credit growth, broad money growth, or even exchange-rate movements. Instead, it is best explained by its own past. Once food inflation rises, it unwinds only slowly—on average, only about 15 percent of the initial shock fades each month, leaving much of it in place for a long time.

This pattern points to structural features of food markets rather than macroeconomic overheating. Dominant intermediaries, markup-setting behavior, and informal extraction weaken competitive discipline. In more contestable markets, exchange rates and liquidity conditions would matter more. In Bangladesh's food markets, they largely do not.

BB's own value-chain evidence reinforces this conclusion: food inflation in Bangladesh reflects structural frictions and weak contestability across key supply chains, not excess demand—explaining both its persistence and its limited sensitivity to monetary tightening.

How shocks spread

If food inflation anchors persistence, non-food inflation is how shocks spread across the economy. Non-food inflation is less persistent than food inflation, but more responsive to macroeconomic conditions—especially movements in the exchange rate.

Persistent food inflation spills into non-food prices through cost-of-living pressures and expectations. When food prices rise, higher rents, service charges, and markups become easier to justify. Roughly half of a sustained increase in food inflation eventually feeds into non-food prices, while the reverse does not occur: non-food inflation does not feed back into food prices.

Non-food inflation is sensitive to exchange-rate movements. A 1 percent depreciation of the taka raises non-food inflation by about 0.15 percentage points within a few months—a meaningful and relatively quick pass-through that builds over time, with roughly one-third of the initial depreciation eventually showing up in prices. This response is strongly asymmetric: depreciation pushes prices up far more forcefully than appreciation pulls them down.

Together, these dynamics explain why inflation in Bangladesh rises quickly and broadly, but falls slowly and unevenly. Even after exchange-rate pressures stabilise and non-food inflation begins to ease, headline inflation remains elevated until food prices finally turn.

Implications for monetary policy

These dynamics imply a different role for monetary policy in Bangladesh than the one embedded in standard demand-based frameworks.

In conventional models, core inflation—typically defined as CPI excluding food and energy—is treated as a proxy for excess demand. Rising core inflation signals overheating; falling core inflation suggests that tighter policy is cooling demand. That interpretation does not fit the Bangladeshi data. Demand-mediated monetary transmission—where tighter policy lowers inflation by cooling domestic spending—appears weak or absent.

This does not make monetary policy irrelevant; it changes the channel through which it matters. In Bangladesh, monetary conditions influence inflation primarily through the external sector. Easier credit and lower interest rates raise demand for imports, increasing pressure on the taka. Exchange-rate depreciation then feeds directly—and asymmetrically—into non-food inflation.

Within this framework, non-food inflation plays a role analogous to "core" inflation, but with a different meaning. It does not reflect excess demand. Instead, it reflects how upstream food and exchange-rate pressures are spreading through the economy, as movements in the taka are rapidly passed through into the prices of imported goods, energy, transport, and other non-food items. Core-like measures are therefore informative as indicators of transmission, but not as signals that demand is overheating or that policy space has opened.

The absence of demand-driven inflation in domestic prices does not imply unconstrained monetary space. While credit expansion may not raise inflation through excess demand, it can still do so indirectly by worsening the external balance, weakening the exchange rate, and triggering cost pass-through into non-food prices. In this system, inflation is not demand-led but exchange-rate–mediated. Because food inflation adjusts downward only slowly, such shocks keep headline inflation elevated even after exchange-rate pressures ease.

Credit expansion can, in principle, raise output through depreciation and higher net exports. In Bangladesh, however, this channel is weak and unstable. Export supply responds slowly, imports are highly input-intensive, and depreciation feeds quickly into domestic costs, eroding real competitiveness. Growth benefits are therefore uncertain and temporary, while the inflation costs are more predictable, asymmetric, and persistent.

The decision at hand

The upcoming Monetary Policy Statement will be judged on whether BB chooses to ease or hold steady. The evidence suggests that cutting rates now would be premature. Easing risks weakening the exchange rate, reigniting inflation, and prolonging the disinflation process.

Monetary policy alone cannot fix food inflation. But BB can still influence food price dynamics by improving contestability in food markets—most directly by reducing non-price frictions in foreign-exchange and trade finance, including clearer, more predictable rules for authorised banks to open import LCs for essential food items and lower discretionary barriers that allow supply to be restricted.

A natural concern is whether easing trade-finance frictions for food imports could weaken the exchange rate and reignite downstream inflation. But improving predictability in foreign-exchange access is not equivalent to monetary easing or import subsidisation. Food import demand responds primarily to supply gaps, while rules-based access reduces hoarding and rent extraction rather than inflating volumes. By easing persistent food price pressures, such measures can support inflation expectations and exchange-rate stability over time.

Staying the course—while supporting currency stability and improving food market contestability—offers a more credible path to sustained disinflation than premature easing in the current inflation regime.

Zahid Hussain is a former lead economist of The World Bank, Dhaka Office

Depositors of Sammilito Islami Bank will be able to withdraw profit on their deposits from February 1, Bangladesh Bank (BB) Governor Ahsan H Mansur said yesterday.

All depositors’ principal amounts would remain fully secure and would be returned gradually, as previously announced, he said at a press conference at BB headquarters.

Currently, customers are allowed to withdraw up to Tk 2 lakh from any deposit scheme, he added.

The governor acknowledged that dissatisfaction has surfaced in various quarters regarding Sammilito Islami Bank, but said the authorities are working to address the issues.

“No plan can be implemented with 100 percent success. Problems are identified over time and resolved step by step,” he said, adding that some groups are attempting to obstruct the implementation of Sammilito banking operations.

Mansur said that from January 1 this year, depositors have been receiving profit at market rates.

The profit rate has been fixed at 9.5 percent for deposits with a tenure of more than one year, while deposits with a tenure of less than one year will earn 9 percent.

He said that depositors’ interests are being given the highest priority in the reform process, adding that the government’s 4 percent support for two years is costing an additional Tk 4,500 crore.

Urging depositors to remain calm, he called on the public not to be misled by rumours surrounding the bank.

The development comes several weeks after BB issued a directive to the five merged banks, Exim, First Security Islami, Social Islami, Union, and Global Islami, saying that no profit would be paid to depositors for the calendar years 2024 and 2025.

Following the backlash from depositors, the governor announced that the government would provide a 4 percent payment for those two loss-making years (2024 and 2025).

The US dollar gained on Friday after former Federal Reserve Governor Kevin Warsh was selected to be the next ​Fed chair, and as the US currency recovered from a sharp selloff earlier in the week that analysts say was ‌overdone in the short-term.

President Donald Trump on Friday chose Warsh to head the US central bank when Jerome Powell’s leadership term ends in May. Warsh is seen as likely to support lower interest rates but would stop well short of the more aggressive easing associated with some of the other potential nominees.

Marc Chandler, chief market strategist at Bannockburn Global Forex, said that Friday’s move higher in the dollar is likely driven at least in part by positioning heading into the announcement.

“The dollar was ‌terribly oversold on the short-term momentum,” Chandler said. Meanwhile Warsh is “only one person…there’s no consensus to have lower rates ​anytime soon, even if we get a late cut or two at the end of the year, like the December dot plot suggested.”

Policymaker projections issued after the US central bank’s December meeting showed a median expectation for a single quarter-percentage-point cut this year.

The Fed on Wednesday held interest rates steady, as ‍was widely expected, amid what Chair Jerome Powell described as a solid economy and diminished risks to both inflation and employment, an outlook that could signal a lengthy wait before any further reductions in borrowing costs.

Fed funds futures traders are pricing in 52 basis points of rate cuts this year, with the first 25-basis-point reduction likely in June.

“The reaction in the markets to Donald Trump’s nomination of Kevin Warsh to be the next Fed Chair is broadly consistent with our view that the president ‍has made a relatively safe choice,” John Higgins, chief markets economist at Capital Economics said in a report.

“The perception seems to be that Warsh is not someone who is ‌firmly in ‌the president’s pocket and that he won’t contribute to a further undermining of the Fed’s independence and fears of currency debasement,” Higgins said.

Gold and silver prices dived Friday and European stock markets ended the week up while Wall Street pulled back with investors reassured by US President Donald Trump's pick to take over as head of the Federal Reserve.

The precious metals, viewed as safe-haven investments, had already begun sliding on reports, later confirmed, that Trump had nominated former Fed official Kevin Warsh to replace Jerome Powell as chair of the US central bank.

Trump announced his choice Friday on social media, saying that Warsh, a former Morgan Stanley investment banker and Fed governor, "will go down as one of the GREAT Fed Chairmen, maybe the best."

Kathleen Brooks, research director at XTB trading group, said the "interesting pick...may give the market some hope that Fed independence will be preserved."

Trump's personal attacks on Fed boss Jerome Powell -- set to depart in May -- have fueled widespread fears among investors that the central bank's policy independence is under threat, potentially posing an inflation risk to the US economy.

Precious metals prices tumbled on Friday after surging in recent days when investors sought a safe haven over doubts about Trump's policies.

Gold fell as much as 12 percent at one point, retreating below $5,000 an ounce after hitting a record high near $5,600 on Thursday.

Silver, which Thursday reached an all-time peak above $120 an ounce, shed around 30 percent to about $82 an ounce.

Financial markets have endured a roller-coaster ride this week as traders weathered a weaker dollar, Trump's threats against Tehran, the president's resumption of tariff threats and a possible US government shutdown.

Asian stock markets closed out the week with some hefty losses following Thursday's tech-led retreat on Wall Street on renewed concerns over vast investments in artificial intelligence.

Healthy earnings from Meta, Samsung and SK Hynix provided much cheer early in the week but Microsoft was punished over worries its costly AI program might not result in financial gains.

There are fears that firms' valuations may be a little too stretched and that markets could be in a bubble, having soared in recent years to record highs on the back of a tech-fueled rally.

The dollar pushed higher on Warsh's nomination.

"Most currency strategists would argue that his nomination may be good news for the dollar, which can price out some risks of a more dovish pick," said Forex.com's Fawad Razaqzada.

"However, for as long as policy uncertainty hangs over the US economy with Trump's tariff theatrics, the dollar debasement narrative is likely to hold back the greenback from making a meaningful comeback."

Among individual companies, Verizon surged 11.8 percent as it reported its highest quarter of mobility and broadband subscription increases since 2019.

After staying relatively affordable for several months, the prices of edible oil and chicken have started climbing ahead of Ramadan, while the vegetable market has stayed mostly stable. A market survey in Dhaka's Karwan Bazar, Lalbagh and New Market today (30 January) found notable increases in several key commodities.

Loose soybean oil is now selling at around Tk170 per litre, up from about Tk165, and bottled soybean oil has risen from roughly Tk190 to Tk200 per litre. Broiler chicken now commands about Tk170–180 per kg, compared with Tk155–160 per kg a couple of weeks ago, while Sonali chicken is priced around Tk270–300 per kg.

Despite the rises in meat prices, egg prices remain stable, with brown eggs around Tk110 per dozen and white eggs about Tk100 per dozen. Beef is selling at Tk750–780 per kg.

Rice prices have also jumped unusually early ahead of Ramadan. Polao rice is now being sold at about Tk138–140 per kg in retail markets, and branded packaged rice commands even higher prices. Some coarse and medium rice varieties have shown slight price relief.

Lentil prices had risen in recent weeks but have eased somewhat. Chickpeas are selling at around Tk95–100 per kg, while red gram lentils have fallen by about Tk5 per kg to roughly Tk55–56 per kg, and larger lentil varieties have become cheaper

Overall vegetable prices are mostly unchanged from last week, with many vegetables selling in the Tk40–50 per kg range. Potatoes and tomatoes have become slightly cheaper compared with a week ago.

Fish prices have not shifted significantly. Depending on size, carp such as Rohu and Catla are selling between roughly Tk300 to Tk450 per kg, while tilapia and koi are about Tk200–240 per kg, and pangas around Tk180–200 per kg. Shrimp remains comparatively expensive, priced between Tk550 and Tk900 per kg depending on size and variety.

The dollar struggled to bounce back Wednesday following another selloff fuelled by Donald Trump’s suggestion he was happy with the currency’s recent decline, while tech firms helped most Asian equity markets extend their rally.

Traders are also keeping an eye on the Federal Reserve’s latest meeting, hoping for some guidance on its plans for interest rates amid uncertainty over the US president’s policies following his latest tariff threats.

The greenback has retreated across the board this week following reports that the New York Fed had checked in with traders about the yen’s exchange rate, which fuelled talk that US and Japanese officials were prepared to stage a joint intervention.

That led to speculation the White House was prepared to let the dollar weaken, and Trump did little to dismiss that when asked Tuesday if he was worried about the decline.

“No, I think it’s great,” he told reporters in Iowa as the unit hit its weakest level against the euro in four-and-a-half years and a two-and-half-month low against the yen. “Look at the business we’re doing. The dollar’s doing great.”

He added: “I want it to be -- just seek its own level, which is the fair thing to do.”

The dollar also sank against the pound, South Korean won and Chinese yuan, with a slight bump Wednesday doing little to recover its latest losses.

Observers said unease about Trump’s latest tariff outbursts, including threats against European nations over their opposition to his Greenland grab and a warning to Canada over its trade talks with China, have also dented faith in US assets and weighed on the unit.

Meanwhile, US consumer confidence plunged to its lowest level since 2014, a survey showed, as households fret about inflation and the elevated cost of living.

Win Thin, at Bank of Nassau 1982 Ltd, said: “Foreign exchange typically is the leader in terms of showing market discomfort with a country’s policies and economic outlook, so this dollar weakness bears watching.”

Still, equity markets performed well in Asia after the S&P 500 clocked another record high in New York thanks to a surge in tech titans including Apple, Microsoft and Amazon.

That helped Seoul to be among the best performers again -- hitting another all-time peak -- as chipmakers Samsung and SK hynix rallied.

There were also big gains in Tokyo, Hong Kong, Shanghai, Taipei, Manila, Mumbai and Bangkok.

London and Frankfurt were flat at the open, while Paris fell.

Jakarta plunged more than eight percent -- its heftiest fall in more than nine months -- after index compiler MSCI called on regulators to look into ownership concerns and said it would hold off adding Indonesian stocks to its indexes or increasing their weighting.

The plunge saw market heavyweights including PT Bumi Resources and PT Petrosea lose around 15 percent.

MSCI said “investors highlighted that fundamental investability issues persist due to ongoing opacity in shareholding structures and concerns about possible coordinated trading behaviour that undermines proper price formation”.

Sydney, Singapore and Wellington dipped.

Traders are keeping a close watch on earnings this week from some of Wall Street’s Magnificent Seven, with Microsoft, Meta, Tesla and Apple all reporting.

“These results will provide critical insights into the trajectory of the artificial intelligence trade,” wrote Tony Sycamore, market analyst at IG.

“After losing momentum in the final months of 2025 due to growing scrutiny over return on investment, capital expenditure and real-world constraints, the market is eager to see if the AI narrative can regain traction in 2026.

“Forward guidance will be key, alongside scrutiny of margins and capex projections.”

In company news, tech investment titan SoftBank jumped almost six percent after the Wall Street Journal reported it was in talks to pump an additional $30 billion into ChatGPT developer OpenAI.

That comes after it invested $22.5 billion last month for an 11 percent stake.

The Ministry of Finance (MoF) has opened discussions on a potential stock-market listing of the Central Depository Bangladesh Limited (CDBL), a move that could reshape the governance and transparency of a key institution underpinning the country's capital markets.Banking services comparison

The issue was raised at a high-level meeting in the Finance Division conference room on Wednesday as part of a broader review of reforms aimed at strengthening market infrastructure.

Established in 2000, CDBL is a state-run depository system that facilitates the electronic trading and settlement of securities.

While no immediate decision was reached, officials agreed to examine the feasibility of listing the CDBL, signalling renewed attention to long-pending structural changes in the stock market ecosystem amid ongoing reform efforts.

The meeting was attended by Financial Institutions Division Secretary Nazma Mobarek, the chairpersons of the Bangladesh Securities and Exchange Commission (BSEC), Dhaka Stock Exchange (DSE), CDBL and Central Counterparty Bangladesh Limited (CCBL), as well as the managing director of the Chittagong Stock Exchange (CSE).

Speaking to The Financial Express, Ms Mobarek said the meeting reviewed a range of issues aimed at strengthening and developing the stock market.

She said a committee headed by Dr Anisuzzaman Chowdhury, Special Assistant to the Chief Adviser, had submitted a set of reform recommendations covering the DSE, CSE, CDBL and CCBL, among other institutions.

"Primarily, we discussed the recommendations and decided to implement them," She added.Newspaper subscription

Sources said the meeting also discussed the possibility of making CCBL a subsidiary of the DSE, although no decision was taken on this matter.

The committee recommended measures to enhance technological capacity across the capital market to reduce risks for investors, market intermediaries, stock exchanges, CDBL, CCBL and other related institutions.

Among the proposals were setting CDBL charges based on trading volume rather than transaction value, and verifying the national identification numbers of individual investors when opening beneficiary owner accounts with CDBL.

These steps aim to reduce market manipulation, unfair advantages and herd behaviour among investors.

The committee also called for immediate measures to strengthen the capacity of CCBL so that it can effectively perform its clearing and settlement functions, ensuring a transparent post-trade environment that mitigates risk and aligns with international best practices.

Other recommendations included revising the criteria for appointing independent directors to stock exchanges and easing overly restrictive rules that currently limit the pool of qualified candidates.

The committee suggested allowing an independent director of a stock exchange to serve as an independent director of up to three listed companies, and permitting such directors to buy and sell shares of listed firms.

The committee further recommended the removal of floor prices for all securities and ensuring that the prices of newly listed securities remain unregulated on the first day of trading.

In addition, it proposed initiatives to bring new products to the capital market, including exchange-traded funds (ETFs), real estate investment trusts (REITs), green bonds, orange bonds, sustainable bonds, sukuk and specialised derivatives.

The recommendations also emphasised the need to encourage the supply of mutual and unit funds in line with investor demand, and to introduce electronic trading for all capital market intermediaries to reduce manipulation and restore investor confidence.

India's gold and silver imports surged to record levels last year, sparking concern among policymakers, with the government having few effective tools to curb inflows that have remained resilient despite sky-high prices for the precious metals.

The country's gold imports rose 1.6% from a year earlier to $58.9 billion in 2025, while silver imports jumped 44% to $9.2 billion, as prices of both metals hit record highs.

Why target gold and silver imports?

India is the world's second-largest consumer of gold and the biggest market for silver, but it meets almost all of its gold demand through imports and relies on overseas supplies for more than 80% of its silver needs.

The country spent nearly a tenth of its total foreign exchange reserves on gold and silver last year, and the import bill is expected to rise further in 2026 as prices of both metals continue to surge.

Rising imports have widened the trade deficit and added pressure on the rupee, which hit a record low this month.

Unlike silver, which has industrial applications ranging from solar power to electronics, gold is largely used for jewellery and investment. The government views such demand as non-essential and has repeatedly sought to curb it by raising import duties, making the metal more expensive for buyers.

Why are traders speculating about a duty hike?

With gold and silver prices touching record highs, the value of imports could rise sharply even if volumes do not, stoking concerns about a widening trade deficit and further weakening of the rupee, which has already slid significantly against the dollar.

Trade and industry officials say these concerns could prompt the government to raise import duties on gold and silver in the coming weeks.

In 2012 and 2013, the government sharply raised duties on gold imports to stabilize a rapidly depreciating rupee. With the currency losing ground again recently, traders speculate a new hike may be coming in coming weeks to reverse duty cuts made in 2024. At that time, India cut import duties on both metals to 6% from 15% to curb smuggling.

Gold and silver are already trading at a premium to global benchmarks as markets price in a potential increase in duties.

Why has Indian gold demand not slumped despite high prices?

Jewellery accounted for more than three-fourths of India's total demand until 2023. Gold prices in the international market have risen 98% since the beginning of 2025 and while that has hit jewellery buying in India, overall demand has not slumped because investment demand has risen.

Indians are increasingly buying coins and bars in the physical market, while a growing number of investors are turning to exchange-traded funds. ETF inflows jumped 283% in 2025 from a year earlier to a record 429.6 billion rupees ($4.69 billion). As a result, the share of investment demand in India's total consumption of gold rose above 40% in 2025 and is expected to increase further in 2026.

Gold and silver ETFs are investment funds that trade on stock exchanges like shares and are backed by physical gold and silver bars held in secure vaults.

Can a duty hike reduce gold demand?

India has repeatedly tried to curb gold imports by raising duties, but with little success. When New Delhi lifted the import tax on gold to 10% in August, 2013 from 2%, demand held steady despite the increase.

Domestic gold prices have risen from about 8,000 rupees per 10 grams in early 2006 to around 162,000 rupees now, but the rally has failed to significantly reduce annual demand. A fresh duty hike of 4 to 6 percentage points is therefore unlikely to deter buyers, who absorbed a 76.5% jump in prices in 2025.

Higher duties could, however, enhance investor returns and increase smuggling. Inflows into gold ETFs have been strong in recent months and are expected to remain firm, as investors turn to bullion amid weak equity market returns.

A sharp price drop could weaken investment demand but boost jewellery sales as buyers waiting for a correction return.

Why are silver imports also becoming a cause for concern?

Silver prices have risen faster than gold, pushing up India's import bill. Until last year, silver demand was mainly driven by rising industrial consumption, but in recent months investment demand has been supporting imports.

Silver ETFs saw inflows of 234.7 billion rupees in 2025, up from just 85.69 billion rupees a year earlier. The growing popularity of silver ETFs suggests imports for investment purposes could rise further if the price rally continues.

The Bangladesh Securities and Exchange Commission (BSEC) and the United Nations Development Programme (UNDP) signed a Memorandum of Understanding (MoU) on Wednesday to foster sustainable finance and develop the thematic bond market in Bangladesh.

The agreement, titled 'Sustainable Finance Collaboration,' was signed at the BSEC headquarters in Agargaon, Dhaka. BSEC Chairman Khondoker Rashed Maqsood and UNDP Bangladesh Resident Representative Stefan Liller signed the document on behalf of their respective organisations.

Under the MoU, UNDP Bangladesh will provide comprehensive technical assistance to introduce a sustainable finance and investment taxonomy. The collaboration aims to support thematic bond issuers – covering green, social, climate, and SDG bonds – throughout the entire process, from pre-issuance to post-issuance.

Key areas of cooperation include training for BSEC officials and stakeholders, sharing experiences from other emerging economies, and ensuring the proper utilisation of funds raised through these bonds.

The partnership will also focus on enhancing project monitoring, bond reporting, and introducing international-standard impact measurement and management frameworks. Furthermore, UNDP will help develop third-party verification systems and risk mitigation strategies for issuers.

Speaking at the event, BSEC Chairman Khondoker Rashed Maqsood said the commission is committed to the continuous improvement of market management.

"We are working to build a strong and credible market structure by strengthening good governance, increasing transparency, and boosting investor confidence," Maqsood said.

He added that the partnership would ensure a supportive and predictable regulatory environment, ultimately establishing the capital market as a primary source for long-term financing and thematic bond development.

UNDP Resident Representative Stefan Liller highlighted the untapped potential of the local capital market in raising long-term capital for high-impact environmental and social investments.

"Increasing investment in various sectors, including addressing climate-related risks, is essential to sustain economic momentum, graduate from Least Developed Country (LDC) status, and avoid the middle-income trap," Liller said.

He noted that thematic bonds could play a catalytic role in raising both domestic and international capital.

The signing ceremony was attended by UNDP Country Economic Advisor Owais Parray, BSEC Commissioners Ali Akbar and Farzana Lalarukh, along with senior officials from both institutions.

Power Grid Bangladesh PLC, a state-owned power transmission firm, reported that its net profit dropped by 72% year-on-year to Tk113 crore in the October-December of FY26.

According to the company's financial statement published on its website, its net profit dropped mainly due to high interest expense and low foreign exchange gain as well as rising transmission cost.

Besides, in the July-December of FY26, its net profit stood at Tk476 crore.

Berger Paints Bangladesh reported that its consolidated revenue rose by 4% year-on-year to Tk2,139 crore in the April-December of FY26 that ended on 31 March.

According to the company's financial statement published on its website, its consolidated net profit jumped by 8% to Tk267 crore and the consolidated earnings per share was Tk55.43 during the first nine months of this financial year.

Besides, in the October-December quarter, its consolidated revenue rose by 5% to Tk805 crore, while the consolidated net profit jumped by 26% to Tk118 crore.

The national committee tasked with restructuring Bangladesh's tax system has submitted a reform agenda to Chief Adviser Muhammad Yunus, proposing major structural changes to boost revenue mobilisation and reduce the economy's heavy reliance on indirect taxation.

The report, prepared by an 11-member taskforce led by Policy Research Institute (PRI) Chairman Dr Zaidi Sattar, sets ambitious targets to raise the tax-to-GDP ratio to 12% by 2030 and 15-20% by 2035, from the current level of around 10%.

It also recommends rebalancing the tax mix by increasing the share of direct taxes to 50% from the existing 30%, signalling a shift towards a more equitable and growth-friendly tax regime.

Titled "Tax Policy for Development: A Reform Agenda for Restructuring the Tax System", the report submitted today (27 January) describes Bangladesh's tax system as unnecessarily complex, inefficient and overly dependent on indirect taxes.

It argues that incremental or piecemeal changes will not be enough to support long-term economic transformation, calling instead for fundamental and structural reforms.

The taskforce identified 55 policy issues, with seven flagged as immediate priorities.

Key recommendations include simplifying the tax system through greater digitalisation and automation, introducing artificial intelligence-based risk analysis, expanding risk-based audits and rationalising tax incentives.

The report also proposes a strategic shift away from trade-based taxation towards stronger domestic tax mobilisation.

On customs reforms, the report suggests modernising the tariff structure and applying equal effective protection for export-oriented and import-substituting industries. It also proposes moving away from port-based enforcement towards post-clearance audits and argues that a separate valuation database for cargo clearance is unnecessary.

In the area of value-added tax, the taskforce recommends a gradual transition from the current multi-rate VAT regime to a single-rate system, saying this would reduce complexity and lower compliance costs for businesses.

Receiving the report, Chief Adviser Yunus said the interim government had limited time but intended to initiate the implementation process.

Finance Adviser Dr Salehuddin Ahmed said the report would serve as a guideline for improving both revenue collection and governance.

Officials from the Internal Resources Division noted that the document clearly diagnoses existing weaknesses in the tax system and offers a roadmap for reform.

Revenue up Tk23,000cr

Meanwhile, the National Board of Revenue, in a detailed briefing sent to Chief Adviser Yunus last Sunday, said its reform initiatives have produced positive results in revenue collection, with government revenue increasing by Tk23,020 crore in the first six months of the current fiscal year compared to the same period a year earlier.

The revenue authority stated that total collections between July and December 2025 reached Tk1,85,229 crore, attributing the increase to structural reforms in revenue management, digitalisation, measures to curb tax evasion and taxpayer-friendly initiatives.

However, economists and former officials have questioned the claim, arguing that the higher growth rate largely reflects a low base in the previous fiscal year rather than the immediate impact of reforms.

According to experts, it was too early for reforms to have such an effect.

Dr Mohammad Abdur Razzaque, chairman of Research and Policy Integration for Development (RAPID), told The Business Standard, "Even if some reforms have been undertaken, their results would not come this quickly. It would take more time."

"The growth we are seeing is mainly due to low revenue collection last year. That low base is why the current growth rate appears higher," he said.

As per NBR data, revenue collection during the first half of FY2024-25 (July-December) did not increase; instead, it declined by about 1%.

A former senior NBR official, speaking on condition of anonymity, echoed that view, saying, "The revenue growth being observed is not due to new reforms."

He rather questioned whether any effective reform had been implemented over the past year.

Structural reforms, legal changes

In its briefing, the NBR highlighted the separation of revenue policy from revenue administration as a major milestone. It noted that the issuance of the Revenue Policy and Revenue Management (Amendment) Ordinance, 2025 had formally divided policy formulation from implementation.

The decision was approved at a meeting of the National Implementation Committee for Administrative Reforms (Nicar), chaired by the chief adviser, paving the way for long-awaited structural reforms within the NBR.

The revenue authority also said the government had moved to curb tax exemptions by introducing the Tax Expenditure Policy and Management Framework, which has been published in the official gazette.

Amendments to the Income Tax Act, the Customs Act and the VAT Act have withdrawn the NBR's authority to grant tax exemptions, it said, adding that any future exemptions will require parliamentary approval.

Digitalisation drive

The NBR said it has undertaken a major digitalisation programme under the World Bank-funded Strengthening Domestic Revenue Mobilisation Project, with an estimated cost of nearly Tk1,000 crore.

The project aims to modernise income tax, VAT and customs operations. Measures such as e-returns, online payments, e-refunds, VAT smart invoices and risk-based audits have reduced hassle for taxpayers, the authority said.

In customs, the launch of the Bangladesh Single Window has enabled certificates, licences and permits from 19 agencies to be issued online. Around 900,000 certificates have been issued so far, with most applications processed within one hour to one day, according to the NBR.

In the VAT sector, a special registration drive led to the issuance of 131,000 new VAT registrations in December 2025 alone, raising the total number of registered entities to 775,000.

The NBR said mandatory online submission of income tax returns has resulted in more than 34 lakh e-returns being filed so far.

An email-based one-time password system has also been introduced for expatriate Bangladeshis, making overseas filing easier. More than 5,000 expatriate taxpayers have already used the facility, it said.

The introduction of a risk-based audit system has made the audit selection process more transparent, the authority added.

Duty, tax relief measures

The government has also provided duty and tax relief in several areas, the NBR said.

These include excise duty exemptions on air tickets and related services for Hajj pilgrims, reduced customs duty and advance income tax on date imports ahead of Ramadan, and duty-tax relief on essential commodities.

Customs duty on mobile phone imports has been cut from 25% to 10%, resulting in an overall import duty reduction of up to 60%, according to the NBR.

The authority said the benefits of these measures were already visible in higher revenue collection, increased taxpayer confidence and a more business-friendly environment, and would help raise the revenue-to-GDP ratio over the medium and long term.

Bangladesh’s economy is showing signs of stabilisation, yet risks and uncertainties remain, and long-term challenges require urgent attention, Planning Adviser Wahiduddin Mahmud has cautioned.

“Inflation, while easing slowly from 11 percent to around 8 percent, is unlikely to drop quickly due to continued high price expectations. Wages are adjusting to inflation, showing the economy has moved into a new phase,” he said, speaking at a seminar yesterday.

Titled “Economic Stability and the Challenges of the Next Government”, the seminar was organised by the Economic Reporters’ Forum (ERF) at the National Life Insurance Auditorium in Dhaka. The ERF Scholarship Award 2026 ceremony was also held.

“GDP growth may reach 5 percent this fiscal year, but I don’t see it as the most reliable indicator. Other markers like imports of industrial raw materials, capital machinery, exports, reserves, and exchange rate give a clearer picture,” the adviser added.

On monetary policy, he noted that the current 10 percent policy interest rate may be unnecessarily high as credit growth remains weak. “SMEs are struggling while RMG exporters are benefiting from a favourable exchange rate,” he added.

Mahmud criticised the hidden costs of stabilisation, including bank recapitalisation using printed money, calling them “invisible but long-lasting consequences” of previous economic mismanagement.

On governance, he remarked, “This is an exceptional government -- neither fully political nor an NGO model. It came out of a mass uprising and is trying to uphold constitutionalism. We’ve never seen this kind of government before.”

He stressed that without major investment in education and skills, the country risks wasting its demographic dividend. He also highlighted progress in public procurement reforms and solar power integration, but cautioned that corruption and inefficiency must be addressed for reforms to succeed.

Azam J Chowdhury, chairman of East Coast Group, stressed the need for broader engagement in economic policymaking, including participation from all political parties and the private sector, to ensure future macroeconomic stability in Bangladesh.

He said discussions around macroeconomic challenges should involve political leaders from across the spectrum. “They must be aware of the current state of the economy and what challenges await in the future,” he noted.

The businessman pointed out that while Bangladesh has adopted some of the IMF’s recommendations, key structural reforms remain pending.

He highlighted inefficiencies and harassment in the business environment. “Even after paying taxes and submitting documents, importers face delays due to unnecessary bureaucracy and interference. These are micro-level operational issues that need urgent simplification,” he urged.

On the energy crisis, Chowdhury said, “There’s no LNG, no LPG, no infrastructure. The interim government has not engaged with the private sector or given clear policy directions. When the next government takes power, how will it manage this?”

Tofazzal Hossain, Chairman of NLICL, called for ethical reform and integrity in Bangladesh’s financial sector, warning against politically motivated bank licensing and poor governance.

Shamsul Haque Zahid, editor of The Financial Express, said the interim government inherited a fragile, near-collapsing economy which it managed to stabilise -- but true recovery remains distant.

He pointed to persistent high inflation, low private investment, and weak job creation, and cautioned that the next elected government will face these issues as legacy burdens.

“The new government may struggle in its first two to three years before achieving stability and growth,” Zahid estimated.

Daulat Akhter Mala, president of ERF, chaired the event, and Abul Kashem, general secretary of ERF, moderated the event. Among others, Syed Abdul Monem, acting managing director of BRAC Bank, and M Kamal Uddin Jasim, additional managing director (AMD) of Islami Bank Bangladesh PLC, also spoke at the event.

Government officials are increasingly unwilling to serve as project directors (PDs) as new policies involving local beneficiaries have led to heightened public scrutiny and questioning regarding the quality of construction materials used in development works.

Planning Adviser Wahiduddin Mahmud came up with the remarks while speaking as the chief guest at a seminar titled "Economic Stability and Challenges for the Next Government" organised by the Economic Reporters Forum in the capital today (28 January).

He noted that beneficiaries are now directly involved in monitoring development works and often question the quality of materials used in projects, including bricks and stone chips.

"As a result, no official wants to become a PD," he said, adding that this has slowed the pace of government project execution.

Former planning secretary Mamun Al Rashid, when asked about the issue, told TBS that the post of project director remains attractive in terms of decision-making authority, financial and administrative power, and logistical support.

"However, many officials are reluctant to assume such responsibilities due to the risks involved," he said.

Mamun explained that project implementation entails managing large sums of public funds under strict timelines and resource constraints.

A major component of any development project is procurement of goods, services and works, which requires in-depth knowledge of public procurement rules and coordination with various committees formed under the Public Procurement Rules, he said.

"Procurement is the most vital and risky part of project implementation," the former planning secretary said, adding that officials often fear future allegations of corruption, which could result in dismissal or even imprisonment.

Economic challenges

At the seminar, Wahiduddin said that although the economy has begun to recover, significant structural challenges persist. He observed that during the previous administration, discipline in the financial sector had collapsed due to money laundering and mismanagement, leaving the banking sector in a fragile state.

The adviser said that corrective measures taken by the current government have brought relative stability.

Imports of industrial raw materials have risen, export growth has been sustained, foreign exchange transactions are stable, and reserves are gradually increasing, he said, adding that GDP growth is expected to approach 5%, while the exchange rate remains steady.

GDP growth is expected to stay near 5%, and while reserves are used for debt repayment, the central bank is actively purchasing dollars to stabilise the situation, he said.

The adviser noted that inflation is declining "slowly" due to "price expectations" and a self-generating cycle. He suggested that the policy rate, currently at 10%, should be reviewed to protect small and medium enterprises (SMEs), as private sector credit growth has fallen to around 6%.

The adviser expressed grave concern over Bangladesh's tax-to-GDP ratio, which remains among the lowest in the developing world at 7% to 8%.

"Our entire revenue is consumed by operational expenses; education, health, and development are funded entirely by loans, which is unsustainable," he warned.

Regarding energy, he noted that no new gas fields have been discovered in 15 years. While wind power remains unfeasible for large-scale use, a new ordinance now allows the private sector to produce and sell solar power, despite initial objections from the Bangladesh Power Development Board.

Corruption

Wahiduddin said that during the current government's tenure, large-scale corruption has decreased. "However, other forms of corruption persist. There is 'case trading' (legal harassment for profit) and 'transfer trading.' For instance, it takes Tk8 lakh to secure a transfer at a college."

He added, "I told the intelligence agencies, but they could not root these out."

Drawing from his experience serving as the education adviser, Wahiduddin said that the education ministry receives hundreds of solicitations for favours. "Previously, work would be done for a fixed sum of money without the need to visit the ministry. Now, everyone says a 'new opportunity' has arisen, so they flock to the ministry in person."

The National Board of Revenue (NBR) has said its reform initiatives have produced positive results in revenue collection, with government revenue increasing by Tk23,020 crore in the first six months of the current fiscal year compared to the same period last year.

In a detailed briefing sent to Chief Adviser Muhammad Yunus on Sunday (25 January), the revenue authority attributed this to structural reforms in revenue management, digitalisation, measures to curb tax evasion and taxpayer-friendly initiatives.

According to the NBR, total revenue collection from July to December 2025 stood at Tk1,85,229 crore, marking a notable rise from the corresponding period of the previous fiscal year.

One of the major milestones of the reform process, the NBR said, is the decision to separate revenue policy from revenue administration.

The briefing noted that the issuance of the Revenue Policy and Revenue Management (Amendment) Ordinance, 2025 formally separated policy formulation from implementation.

The decision's approval came at a meeting of the National Implementation Committee for Administrative Reforms (NICAR), chaired by the chief adviser, paving the way for long-awaited structural reforms within the NBR.

Major investment in digital revenue system

The NBR said that to fully digitise revenue management, a World Bank-funded project titled Strengthening Domestic Revenue Mobilisation Project (SDRMP) has been undertaken at a cost of nearly Tk1,000 crore. The project aims to modernise income tax, VAT and customs operations.

The introduction of e-returns, online payments, e-refunds, VAT smart invoices and risk-based audits has reduced taxpayer hassle, the NBR added.

Parliamentary approval mandatory for tax exemptions

To move away from tax exemptions, the government has formulated the Tax Expenditure Policy and Management Framework and published it in the official gazette, the NBR said.

Amendments to the Income Tax Act, Customs Act and VAT Act have withdrawn the NBR's authority to grant tax exemptions, it added, mentioning that from now on, no tax exemption can be granted without parliamentary approval.

Customs and VAT

With the launch of the Bangladesh Single Window (BSW), certificates, licences and permits from 19 agencies are now being issued online.

So far around 900,000 certificates have been issued digitally, with most applications processed within one hour to one day, the NBR said.

In the VAT sector, a special registration campaign led to the issuance of 1,31,000 new VAT registrations in December 2025 alone, raising the total number of VAT-registered entities to 775,000.

Response to e-returns in income tax

Mandatory online income tax return submission has resulted in more than 34 lakh e-returns being filed so far, the NBR said.

An email-based OTP system for expatriate Bangladeshis has made overseas filing easier, with over 5,000 expatriate taxpayers already using the facility, it added.

The NBR stated that the introduction of a risk-based audit system has also made the audit selection process more transparent.

Duty and tax relief for business and public interest

The government has granted excise duty exemptions on air tickets and related services for Hajj pilgrims, reduced customs duty and advance income tax on date imports ahead of Ramadan, and provided duty-tax relief on essential commodities.

Additionally, customs duty on mobile phone imports has been reduced from 25% to 10%, resulting in an overall import duty reduction of up to 60%.

According to the NBR, the benefits of these reforms are already being reflected in higher revenue collection, increased taxpayer confidence and a more business-friendly environment.

The briefing noted that in the medium and long term, these reforms will play a crucial role in increasing the revenue-to-GDP ratio.

Bangladesh's external financing situation is showing clear signs of stress. In the first half of the 2025-26 fiscal year, for every $100 received in foreign loans, $88 was used for debt repayment, leaving the country with only a marginal net inflow.

According to the latest Foreign Assistance Monthly Report published by the Economic Relations Division (ERD), total aid disbursement stood at $2.5 billion during the period, while debt servicing amounted to $2.2 billion. As a result, net foreign inflow was limited to just 12% of total disbursements, highlighting shrinking fiscal space and limited support for development expenditure.

On top of debt repayment pressure, a decline in foreign commitments and disbursements is compounding the situation.

Economists warn that when such a large share of foreign borrowing is absorbed by repayments, the government's ability to finance infrastructure and social programmes is significantly constrained. This underscores the urgent need for more prudent borrowing, faster project implementation, and diversification into concessional and alternative financing sources.

Mustafa K Mujeri, former director general of the Bangladesh Institute of Development Studies, noted that repayment pressure has increased as grace periods for several mega projects and budget-support loans taken by the previous government have started to expire.

Meanwhile, debt servicing obligations rose to $2.20 billion, up from $1.98 billion in the first half of FY2024–25. Both principal and interest payments increased, placing renewed pressure on foreign exchange reserves and reducing net aid inflows to only $300m.

Planning Adviser Wahiduddin Mahmud today (28 January) said at an event organised by the Economic Reporters Forum that despite having opportunities to borrow externally, the current government is limiting development project loans to reduce pressure from debt repayments.

Earlier, following a meeting of the Executive Committee of the National Economic Council (Ecnec), the planning adviser told reporters that foreign loans would only be taken for projects that are technologically complex, impossible to finance domestically, and capable of generating investment, exports, and foreign exchange earnings.

He said the government has decided to reduce dependence on foreign borrowing for social sectors such as education and health, opting instead for domestic financing.

As a result, several foreign-funded projects were recently sent back without approval at Ecnec meetings.

"Poorly prepared projects often face complications during implementation. For this reason, the government is refraining from negotiating with development partners on many projects," the ERD official said.

ERD officials added that grace periods for several projects – including the Rooppur Nuclear Power Plant – will expire over the next one to two years, which will significantly increase debt repayment pressure.

They said debt servicing is expected to approach $5 billion in the current fiscal year and will continue to rise in the coming years.

M Masrur Reaz, chairman and CEO of Policy Exchange Bangladesh, said, "The near-equalisation of loan disbursement and repayment is a growing concern for Bangladesh's fiscal health. Fiscal space is already tight, and as the country aims to move toward higher-middle-income status, significant public investment is needed in human capital, infrastructure, and institutional capacity. Sustaining growth requires expanding the public investment budget."

Past reliance on external loans for projects with poor feasibility or weak returns has increased debt service obligations, further constraining fiscal space, he said.

The government should also explore alternative financing beyond traditional borrowing, including local and international capital markets, he noted. "Diversifying financing channels will reduce fiscal vulnerability and strengthen resilience. A balanced approach combining better revenue, efficient spending, debt management, and diversified funding is critical for Bangladesh's sustainable growth and transition to higher-middle-income status."

Election behind the decline in foreign commitments?

Foreign aid commitments declined to $1.99 billion in the first half of FY26 from $2.30 billion a year earlier, while grant inflows fell sharply from $290m to just $95m. Loan commitments also declined slightly, indicating continued dependence on borrowing even as concessional aid dries up.

Mustafa K Mujeri said a major reason behind the decline in foreign commitments and disbursements is election-related uncertainty.

"During election periods and interim phases, new project approvals, fresh loan agreements, or renegotiations usually do not take place. Development partners are also reluctant to make new commitments, as they wait to see what policies and priorities the incoming government will set," he said.

He added that although the previous fiscal year was already challenging, the picture for commitments and disbursements in the first half of the current fiscal year is even weaker.

"In other words, although the overall situation may appear somewhat stable, this stability has not yet been reflected in foreign loan inflows."

Mujeri further said that until a new government formally assumes office, there is little chance of a significant improvement in foreign loan commitments or disbursements. Development partners want clarity on policy direction, project priorities, and reform agendas before engaging in new financing.

"Most of the current commitments and disbursements stem from earlier negotiations or pre-existing agreements," he said.

ERD sources said that foreign loan commitments were low last fiscal year due to the mass uprising, fall of the government, administrative instability, and a confidence deficit among development partners. This year, however, the government is deliberately reducing the number of foreign-funded projects to ease repayment pressure, which has contributed to lower loan commitments in the current fiscal year.

A senior ERD official told The Business Standard that foreign loan commitments declined in the first six months of the current fiscal year because the government is avoiding project loans without adequate preparation.

The Dhaka Stock Exchange (DSE) today (27 January) decided to downgrade Desh Garments to the Z category from B category, after the company failed to disburse approved dividends to their shareholders.

In FY25, the company recommended a 3% cash dividend to their general shareholders other than sponsors and directors of the company.

According to the DSE, after declaring dividend in its board meeting and obtaining approval from general shareholders at the annual general meeting (AGM), the company failed to disburse the dividend to their shareholders within the stipulated timeframe.

As per listing regulations, listed companies must disburse declared or approved dividends within 30 days of approval at their AGM.

Due to the failure to disburse dividends on time, the DSE downgraded this company to the Z category.

A company falls into the Z category if the firm fails to hold an AGM, fail to declare any dividend based on annual performance, have not been in operation continuously for more than six months, or accumulate losses that exceed its paid-up capital after adjusting revenue reserve.

Yesterday, the share price of the company increased 1.97% to Tk113.80 on the Dhaka stock exchange.

A company official said, seeking anonymity that this issue will be resolved within a week. However, the official did not share how much has been disbursed to their shareholders within the stipulated timeframe.

In the July-September quarter, the company made revenue of Tk21.68 crore, which was Tk16.11 crore in the same period of the previous year.

In this quarter, the company made a profit of Tk3.62 lakh and its earnings per share stood at Tk0.04.

Its net asset value per share stood at Tk157.03 at the end of September 2025.

Bangladesh received reduced foreign loans in the first half of the current fiscal year (FY) 2025-26 as the execution of foreign-funded projects under the Annual Development Programme (ADP) fell to its lowest level in at least five years.

During the July-December period, the country received $2.49 billion from international financial institutions, namely the World Bank and the Asian Development Bank (ADB), as well as bilateral lenders such as Russia, China, Japan, and India.

This represented a 29 percent year-on-year decline in fund releases, according to data from the Economic Relations Division (ERD) of the finance ministry.

During the same period, the implementation of foreign-funded ADP projects stood at 18.58 percent, down from 19.61 percent in the first half of FY2024-25, according to the Implementation Monitoring and Evaluation Division under the planning ministry.

Expenditure on projects tied to foreign loans also fell sharply in absolute terms amid political uncertainty.

Earlier this month, the Centre for Policy Dialogue (CPD) recommended giving top priority to implementing all foreign-funded ADP projects, citing the current state of the country’s foreign exchange reserves.

ERD data showed that commitments of financing from international and bilateral lenders declined as lenders awaited the country’s political transition ahead of the national election scheduled for February 12.

ERD said funding promises fell 13 percent year-on-year to $1.99 billion during July-December of FY2025-26, with the ADB pledging $1.26 billion of the total.

Despite the decline in both commitments and disbursements, pressure to repay foreign loans increased.

Bangladesh’s debt servicing rose 11 percent year-on-year, amounting to $21.9 billion during the same period.