When tensions escalate among global and regional powers, the shockwaves ripple through oil markets, shipping lanes, labour migration routes, and financial systems, reaching economies thousands of kilometres away.

The US-Israel war on Iran is rapidly emerging as one of the most significant geopolitical crises for the global economy in recent years, sending tremors through markets and supply chains.

Although the fighting is roughly 4,000 kilometres from Bangladesh, economists say the impact could be substantial for a nation heavily reliant on imported fuel and remittances from workers in the Middle East.

According to economists, the crisis due to the war risks setting off a chain reaction: rising energy prices, disrupted trade flows, weakened export competitiveness, turmoil in the migrant labour market and remittance inflows, higher inflation, and renewed pressure on foreign exchange reserves amid a constrained fiscal space.

Zahid Hussain, former lead economist of the World Bank’s Dhaka office, said Bangladesh’s economic exposure could unfold through three channels: energy, the dollar, and trade and finance.

He compared the potential shock of the war to an earthquake rather than a passing storm.

A storm passes temporarily, Hussain said. “Water rises and then recedes. Some damage happens, but the situation stabilises. But an earthquake damages the underlying infrastructure, affecting both life and property.”

The economist said the scale of the impact will depend on both the intensity and duration of the war.

“The key question is not only the magnitude of the shock, but also how long it lasts. The longer it continues, the greater the damage,” he said.

ENERGY SHOCK LOOMS

The most immediate and potentially severe impact of the Iran war is on global oil markets, with the price surging to $119 as of yesterday compared to around $72 per barrel a year ago.

The Gulf region sits at the heart of the world’s energy supply chain.

Following last week’s US and Israel’s attack on Iran, Tehran blocked the Strait of Hormuz, a crucial maritime route, seriously disrupting cargo transport between the Middle East and Bangladesh.

Major shipping lines have suspended cargo bookings between the Indian subcontinent, including Bangladesh, and the Gulf.

For Bangladesh, the consequences could be painful.

The country imports almost all its fuel -- from crude oil to refined petroleum and liquefied natural gas (LNG). A spike in oil prices would immediately inflate the country’s energy import bill.

Long queues have already appeared at fuel stations across the country as panic buying spreads, while the government has closed universities and introduced fuel rationing to cushion the fallout.

Higher fuel prices would also increase costs for electricity generation, transportation, and industrial production.

In that case, the government, already struggling to manage energy subsidies, would face difficult choices: absorb the cost through larger subsidies or pass it on to consumers through higher fuel and power prices.

Both carry economic consequences, such as rising subsidies straining public finances, while higher domestic energy prices push up living costs and production expenses.

INFLATION COULD GO WILD, AGAIN

Energy shocks rarely stay confined to the power sector; instead, they ripple through the entire economy.

Bangladesh has been struggling with stubbornly high inflation for around three years. Inflation was above the 9 percent mark from March 2023, easing slightly in 2025, and showing a resurgence recently.

The drivers for renewed price pressure include high food prices, currency depreciation, and rising import costs.

A further rise in global oil prices would amplify these pressures by raising transport and logistics costs across supply chains.

Higher fuel costs affect everything from agricultural irrigation to the distribution of essential commodities, potentially pushing food inflation higher and squeezing household purchasing power.

This dynamic could leave the economy facing elevated inflation alongside slowing growth.

After months of easing, headline inflation reached a 10-month high in February due mainly to rising food prices, according to the Bangladesh Bureau of Statistics (BBS).

FOREIGN EXCHANGE UNDER STRAIN

Energy imports are one of Bangladesh’s largest sources of foreign currency outflows. A prolonged rise in oil prices would add pressure on the country’s foreign exchange reserves.

Bangladesh has previously faced periods of reserve stress due to high import bills and currency volatility. Another energy shock could widen the current account deficit, increasing the cost of fuel imports.

As demand for dollars rises, the Bangladeshi taka may face renewed depreciation, further raising the domestic price of imported goods and reinforcing inflation.

REMITTANCE RISKS

Bangladesh’s large migrant workforce in the Middle East is another vulnerability. Since fiscal year 2025, around 86 lakh Bangladeshi workers have gone abroad for jobs, with Saudi Arabia employing nearly half.

Middle Eastern countries, including Saudi Arabia, Oman, Qatar, the United Arab Emirates, and Kuwait, account for around 75 percent of overseas employment, according to the Bangladesh Economic Review 2025.

If the conflict escalates, economic activity in the Gulf could slow, threatening employment for migrant workers and reducing remittance inflows.

Even a moderate slowdown would put additional pressure on Bangladesh’s external balance, as remittances play a crucial role in offsetting the country’s large import bill.

The war could also disrupt global trade routes. During geopolitical tension, shipping companies often raise insurance premiums, and freight rates increase if vessels reroute to avoid conflict zones.

For Bangladesh’s export-oriented industries, particularly the ready-made garment sector, higher logistics costs could reduce competitiveness. Importers would also face higher charges for essential commodities, machinery, and industrial inputs, feeding through into domestic prices.

Bangladesh’s energy system remains fragile. Power generation depends heavily on imported fuels and LNG.

Tight global gas markets or surging LNG prices could make affordable supply difficult, leading to potential power shortages or higher generation costs. Such disruptions could affect industrial production, especially in energy-intensive sectors such as manufacturing and textiles.

“The first risk is energy, both in terms of price increases and availability,” said economist Hussain.

“Even if you are willing to pay a higher price, you may not be able to secure supply. If energy supply is disrupted, the real economy, agriculture, industry and services, comes under risk,” he added.

The economist also warned of mounting pressure on the US dollar. “As global uncertainty rises, the dollar strengthens and our import bill increases,” Hussain said.

“Even if the volume of imports does not rise, the total bill will increase, meaning we will have to spend more local currency to buy the same amount of dollars. That will further fuel inflation.”

A stronger dollar could complicate external payments.

“When dollars become scarce, settlement of outstanding payments becomes difficult, and payment obligations start to accumulate,” he said, adding that this could create pressure on banks’ balance sheets and the government budget.

The third channel is trade and financial flows, particularly higher logistics costs.

“Freight charges, port costs and insurance premiums are already rising, which increases payments under the services account of the balance of payments,” Hussain said. “Individually, these costs may seem small, but collectively they create significant pressure.”

He also flagged risks to remittance flows.

“There are two risks for remittances. First, employment and wage risks for migrant workers if the conflict spreads, and second, possible disruptions in payment systems that could affect money transfers,” he said.

“The external balance, financial sector and energy supply are all exposed, and their combined impact will eventually affect the real economy -- growth, employment and wages,” Hussain added.

BANGLADESH NEEDS A CONTINGENCY PLAN

Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue (CPD), said Bangladesh should prepare a contingency plan to deal with emerging risks.

“We need to think about how to use the foreign financing already in the pipeline so that pressure on foreign exchange reserves remains limited,” he said. Once these funds arrive, they could add several billion dollars to reserves, easing external pressure.

Rahman also called for mobilising additional support, including budgetary assistance from institutions such as the World Bank.

“If fuel import costs surge, it will be very difficult to manage through reserves alone,” he said. “In that case, we may need financing arrangements such as import credit facilities from institutions like the Islamic Development Bank. Preparing a contingency plan in advance would be a prudent step.”

Finance Minister Amir Khosru Mahmud Chowdhury, when asked about the potential impact of the war and whether austerity measures were being considered, did not provide a detailed response.

“We are working on this issue,” he told The Daily Star.

The government must address seven major economic challenges, including persistent inflation and energy constraints, through coordinated reforms to restore growth and strengthen economic resilience, speakers said yesterday.

Bangladesh’s economy faces multiple structural obstacles, as highlighted at the launch of a publication by the Metropolitan Chamber of Commerce and Industry (MCCI) titled “Reviving Private Sector-Led Economic Growth: Critical Issues and Priorities Facing the New Government in Bangladesh”, organised jointly with Policy Exchange Bangladesh in Dhaka yesterday.

The report identifies seven priority reform areas: macroeconomic stabilisation, fiscal management, financial sector reform, export competitiveness and diversification, revitalising private investment, energy security and skills development for employment.

Presenting the report, M Masrur Reaz said Bangladesh’s economic management requires an integrated approach as multiple structural constraints are slowing investment, exports and job creation.

He said the country entered a macroeconomic crisis in mid-2022 when inflation rose to around 13-14 percent, foreign exchange reserves dropped from nearly $48 billion to about $19 billion, and the taka depreciated sharply.

Although reserves have recovered to around $28-29 billion, major vulnerabilities remain.

Economic growth has slowed to about 3.49 percent, while the tax-GDP ratio has fallen to around 7 percent and debt servicing now accounts for roughly 21 percent of the national budget.

Private investment has declined from 24.9 percent to 22.5 percent of GDP, while foreign direct investment remains below 1 percent of GDP. Export concentration is another concern, with the readymade garment sector accounting for about 81 percent of exports.

The report recommends key reforms within the government’s first 100 days, including improving macroeconomic coordination, adopting a market-based exchange rate and launching investment climate reforms to restore investor confidence and revive growth.

Hossain Zillur Rahman, executive chairman of the Power and Participation Research Centre, said the private sector must re-establish an independent and constructive voice in national policymaking following the political transition.

He noted that during the previous long period of authoritarian governance, many private sector bodies lost their independent voice and became extensions of political processes.

Dewan Hanif Mahmud, editor of The Daily Bonik Barta, said Bangladesh should conduct forensic audits of major state-owned institutions to understand the true condition of the economy.

He stressed that forensic audits should be carried out in key state entities, including banks and energy institutions, to determine their financial health and asset quality.

Kamran T Rahman said Bangladesh’s economic recovery remains fragile despite some easing of balance of payments pressure and inflation.

He warned that LDC graduation will bring new challenges, including reduced preferential market access, tougher compliance requirements and sharper global competition.

Habibullah N Karim, vice president of MCCI, and Farooq Ahmed, secretary general and CEO of MCCI, also spoke at the event.

For four years, Bangladesh has struggled to escape the inflation spiral unleashed by the Russian invasion of Ukraine in February 2022, a crisis that turned it into South Asia's highest-inflation economy.

Now another geopolitical shock is gathering force. On the tenth day of the US-Israel war on Iran, global oil prices have surged past $100 a barrel for the first time since that invasion, threatening to unleash yet another inflation storm on an already strained economy.

The uncomfortable irony is that the escalating war in the Middle East arrives just as a freshly elected government takes office and just as inflation had finally begun to slow.

Following a tightening monetary stance by the Bangladesh Bank, inflation had slipped below 9% – still high, but hinting that the long price surge might finally be losing momentum.

Oil soars 25%, gold drops as Iran war jolts global commodity markets

The latest data from the Bangladesh Bureau of Statistics reveal just how uneasy the inflation landscape still is. Overall inflation climbed to 9.13% in February 2026, a ten-month high. Even more worrying, food inflation – the measure that defines everyday living costs – jumped to 9.30%, the highest in 13 months.

For ordinary households, the pain is becoming structural. Wage growth stood at 8.06%, marking the 48th consecutive month in which income growth has lagged behind inflation.

US crude oil, the front-month West Texas Intermediate futures soared 30% to hit $118.28 a barrel in Monday (9 March) trading hours, while Brent, the international benchmark, jumped more than 25% to $116.67 per barrel.

The surge comes as the escalating US-Israel war on Iran has fuelled fears of prolonged disruption to shipments through the Strait of Hormuz, which carries one-fifth of the world's daily oil supply, while the UAE and Kuwait have begun cutting oil production after the Strait blockage.

Inflation shoots up to 9.13% in February, highest in 10 months

For Bangladesh, such shocks rarely remain distant geopolitical headlines. Even before oil crossed $100 per barrel, panic buying gripped petrol pumps, showing that government assurances and rationing did little to calm fears.

The country imports most of its fuel and fertiliser, so global oil spikes ripple through the economy: transport costs rise, electricity becomes more expensive, fertiliser and irrigation costs climb, shipping costs increase, and eventually the pressure spreads to food markets and consumer goods. In short, global oil shocks quietly reach domestic kitchens.

Bangladesh has faced this before. The Russian invasion of Ukraine sent fuel, fertiliser, and food prices sharply higher, pushing inflation above 9% and keeping it stubbornly elevated for years. Today, the macroeconomic environment is even more fragile.

Merchandise exports fell for the seventh consecutive month in February 2026, while private credit growth dipped to a record low of 6% in January. Even the General Economics Division (GED) of the Planning Commission could not look away – its February 2026 Monthly Economic Update & Outlook report highlighted that a revenue shortfall, combined with weak mid-year Annual Development Programme (ADP) utilisation, is creating mounting fiscal challenges.

Governments scramble to limit fallout of Iran war as oil prices surge

The pressure on the taka is a particular concern. From Tk86 in February 2022 to crossing Tk100 in September 2022, it has now stood at Tk122.5 against the US dollar. With the US-Israel war on Iran driving energy costs ever higher, a further weakening of the taka could sharply push up import bills, electricity and fuel costs, and production expenses, sending the economic burden soaring across Bangladesh.

This also creates a difficult dilemma for monetary policy. With inflation already high, there is little room to loosen policy to stimulate growth. Yet tighter financial conditions risk slowing investment and employment.

Whether this becomes another full-scale inflation storm will depend largely on how long the war persists and whether global energy supply and routes stabilise. But the early signals from markets are unsettling.

Bangladesh is bracing for a storm it cannot fully control, and the coming months will test both policy resilience and the patience of ordinary citizens.

A day after a massive bloodbath at the Dhaka bourse, stocks rebounded yesterday as the sell-off largely subsided and buyers dominated the market.

The DSEX, the benchmark index of the Dhaka Stock Exchange (DSE), surged 132 points, or 2.64%, with more than 90% of the traded stocks advancing on the bourse, although turnover fell by 22%, data showed.

On Sunday (8 March), the first trading session of the week, stocks suffered the highest single-day fall in six years as escalating geopolitical tensions in the Middle East triggered panic selling across the market.

The index plunged 231 points, or 4.42%, to close at 5,008, hitting a two-month low and marking the biggest one-day decline since the Covid-19 pandemic era.

Market insiders said Sunday's sell-off was mostly panic driven assuming fuel crisis significantly may hit businesses due to Middle East conflict. After the conflict began, stocks witnessed bearish trends as cautious investors preferred to pull-off funds selling shares.

"Stocks declined significantly in recent trading sessions due to heavy sell-offs. As investors offloaded shares in previous sessions, funds generated from those sales were reinvested in the market, which helped stocks rebound," said the managing director of a brokerage firm.

The port city bourse, Chittagong Stock Exchange (CSE), settled on a positive territory. The Selective Categories' Index (CSCX) and All Share Price Index (CASPI) advanced by 51.9 points and 82.6 points, respectively.

Bank stock save indices

The data showed that stocks began trading on the red pulling DSEX below 5,000 points marks. Six minutes later after starting trades, stock climbed to green as sell-offs reversed into buy domination, and continued till 10.22am with DSEX increasing 100 points.

After that a wave of sell-off again gripped the market, the bank stocks saved the indices as share prices of some large cap stocks including Islami Bank, BRAC Bank, City Bank and Pubali Bank increased.

According to LankaBangla financial portal, the four banks pulled DSEX by 54 points with a total increase of 132 points.

At the DSE, shares of 36 banks listed, but trading continued for 31 banks as shares trading of five Islamic banks suspended as the banks were merged into a one entity namely Sammilito Islami Bank.

On Sunday, the share price of 39 banks increased, only a bank share declined and shares price remained unchanged for a bank.

EBL Securities said, the capital bourse staged a partial rebound following the steep selloff in recent sessions, as bargain hunters turned back to accumulate equities at attractive price points; however, overall investor participation remained subdued amid lingering uncertainties surrounding the ongoing Middle East conflict.

It said, market indices maintained an upbeat trajectory throughout the session, supported by broad-based price appreciation across most scrips. However, cautious investors remained on the sidelines, closely monitoring market direction amid the absence of any visible progress toward a resolution or ceasefire in the ongoing conflict.

Apparently, market turnover decreased by 21.8% to Tk4.2 billion from Tk5.3 billion in the previous session. On the sectoral front, Bank stocks accounted for the highest share of turnover by 25.5%, followed by Pharma by 19.3% and Textile by 8.9%.

Gainers, losers

Islami Bank Bangladesh topped the gainer list hitting upper circuit, a highest single day limit capped by the regulator, by 9.89% to Tk41.10 each at the DSE.

Followed by City Bank by 8.24% to Tk30.2 each, AB Bank by 8.19% to Tk6.6 each, EBL NRB Mutual Fund by 8% to Tk2.7 each, and First Bangladesh Fixed Income Fund by 8% to Tk2.7 each.

While on the losing side, Green Delta Insurance topped the loser list as its shares price fell by 7.10% to Tk52.3 each, followed by Vanguard AML Rupali Bank Balanced Fund by 5.35% to Tk5.3 each, Dulamia Cotton Spinning Mills by 5.32% to Tk112 each, Renwick Jajneswar by 1.93% to Tk521.8 each, and Golden Jubilee Mutual Fund by 1.69% to Tk5.8 each.

Islami Bank Bangladesh PLC has approved a proposal to bring little-known US-based B100 Holdings LLC as a strategic investor in its mobile financial services subsidiary mCash Ltd, aiming to strengthen the platform's capital base and expand its digital financial services.

The decision was taken at a board meeting of Islami Bank Bangladesh PLC held at its head office in Dhaka on Sunday, according to a price-sensitive disclosure issued the same day.

Under the proposal, the New York-based B100 Holdings will join as a strategic partner in mCash Ltd, which operates the bank's mobile financial services platform. The investment will be subject to compliance with legal and regulatory requirements and approvals from relevant authorities.

Following the announcement, Islami Bank's share price rose 9.89% on the Dhaka Stock Exchange yesterday, reaching Tk41.10. The bank's market capitalisation increased by around Tk690 crore to Tk6,617 crore.

According to the disclosure, the paid-up capital of mCash will be increased in phases to Tk500 crore. Islami Bank will retain at least 51% ownership of the subsidiary, while B100 Holdings may acquire up to 48.99% of shares through subscription, subject to approval from the mCash board and regulators.

Under rules set by Bangladesh Bank, commercial banks must hold a minimum 51% stake in mobile financial service providers. Islami Bank said it would comply with the requirement while allowing the foreign investor to hold a maximum of 48.99% of shares.

Based on the proposed capital structure, B100 Holdings could invest nearly Tk245 crore in the company.

Omar Faruk Khan, managing director of Islami Bank, said the proposal originated from the US firm.

"They approached us with the investment proposal and our board has accepted it in principle because they committed to bring funds as needed, potentially from the Middle East," Omar told The Business Standard.

He said the bank would now examine the firm's financial strength and capability before finalising any agreement.

"At this stage, we are still in the initial phase. After reviewing their strength and ability, we will make the final decision regarding the partnership," he added.

Omar also acknowledged that mCash has struggled to secure a strong position in the market since its launch more than a decade ago.

"Despite operating for over ten years, mCash remains in a relatively weak position compared to other mobile financial service providers. Our goal is to develop mCash into a competitive platform similar to bKash, the country's leading MFS provider," he said.

To achieve that goal, the bank plans to increase investment in the platform and bring in a strategic partner capable of supporting long-term expansion.

Limited information about US investor

Public information about B100 Holdings, however, remains limited. According to the New York company registry, the firm was established on 22 December 2025 in New York. Arman Chowdhury is listed as its co-founder and chairperson.

Several stock market analysts contacted by The Business Standard said they were unfamiliar with both the individual and the newly formed investment firm.

Information available online indicates that Arman has been serving as national executive director of the Muslim Ummah of North America since 2021. He is also associated with New York's Baitul Mamur Masjid and Community Center as its president.

According to the company's website, B100 Holdings aims to invest in Bangladesh's economic infrastructure by supporting 100 large business enterprises through institutional capital, governance frameworks, and operational expertise.

The firm describes itself as a principal investor and long-term sponsor that deploys capital on a deal-by-deal basis alongside select institutional partners.

It says this model allows it to focus on long-term value creation without the constraints of traditional fund cycles or forced exits.

Islami Bank launched the mCash service in December 2012 and operated the platform directly through its own infrastructure for more than a decade. In January this year, the bank spun off the service into a separate subsidiary to strengthen governance and attract external investment.

The newly formed mCash Ltd has an authorised capital of Tk1,000 crore and an initial paid-up capital of Tk50 crore.

Iran has agreed to provide Bangladeshi oil ships with safe passage as the Bangladesh government has intensified efforts to maintain a stable fuel supply through multiple strategic measures amid escalating conflict in the Middle East.

Bangladesh has sought assurances from Iran for the safe passage of its oil and LNG-carrying vessels through the Strait of Hormuz as escalating conflict in the Middle East threatens one of the world's most critical energy shipping routes.

Iran has agreed that Bangladeshi ships will be allowed to pass through the strategic waterway after notifying Iranian authorities before entering the strait, energy officials said, easing immediate concerns over the country's fuel supply.

Meanwhile, a vessel carrying 27,000 tonnes of diesel arrived at Chattogram port from Singapore yesterday, and four more ships carrying 1,20,205 tonnes of fuel are scheduled to arrive at the port later this week, energy officials have said.

They said to meet April's demand, the Ministry of Power, Energy and Mineral Resources has begun the process of importing 3 lakh tonnes of diesel from alternative sources through direct procurement.

An official said Bangladesh is planning direct procurement outside long-term contracts, as deliveries under existing agreements have become uncertain following the war.

Under normal circumstances, the country's daily diesel demand is 12,000 tonnes, but the government is currently supplying 9,000 tonnes per day. If the current supply continues, the five incoming shipments totalling 147,205 tonnes will cover 16 days of national demand.

On Monday morning, Mohammad Arif Sadek, the ministry's public relations officer, confirmed the arrival of a fuel vessel at Chattogram port and said another ship was expected on Monday night.

China and India signal support

India and China have also expressed willingness to assist Bangladesh in supplying fuel. Finance Minister Amir Khasru confirmed seeking cooperation from India and China to ensure energy security, stating:

"Not only India and China, we have approached several countries to secure fuel supplies and maintain communication with them. There is no reason for a fuel crisis."

After a meeting with Finance Minister Amir Khasru Mahmud Chowdhury and Energy Minister Tuku yesterday, the ambassador China Yao Wen confirmed his country's interest in supporting Bangladesh.

After the meeting, Yao Wen said Bangladesh and China will work together to resolve fuel issues, and China is eager to provide fuel assistance.

Option to import more diesel from India

Under an existing agreement between BPC and India's Numaligarh Refinery Limited, the Indian state-owned refinery is scheduled to supply 180,000 tonnes of diesel annually through the India-Bangladesh Friendship Pipeline.

Of this volume, around 120,000 tonnes have already been confirmed, but Bangladesh still has the option to import an additional 60,000 tonnes depending on its demand.

According to BPC officials, the additional supply being explored would mainly cover the last week of March and the entire month of April, as two diesel cargoes scheduled for early March failed to arrive within their delivery windows.

Monir Hossain Chowdhury, Joint Secretary (Operations) of the Energy Division, told TBS that several suppliers have proactively offered to sell fuel to Bangladesh. The BPC will review these offers and forward them to the ministry for approval.

4 more tankers due this week

Port sources said tanker Xiu Chi, carrying 27,204 tonnes of diesel from Singapore, entered Chattogram port yesterday. Shipping agents said four more diesel tankers are scheduled to arrive in the coming days.

Another tanker, Lian Huan Hu, was expected to reach the port last night from Singapore with nearly 30,000 tonnes of diesel. The tanker SPT Themis is scheduled to arrive on Thursday carrying 30,484 tonnes.

Tanker carrying 27,000 tonnes of diesel reaches Ctg Port, 4 more due this week

Two additional vessels – Raffles Samurai and Chang Hang Hong Tu – are expected to reach the port on Saturday, each carrying around 30,000 tonnes of diesel.

Nazrul Islam, managing director of Pride Shipping, the local agent for the four tankers, told TBS that the vessels are expected to arrive within a week according to schedule.

Emergency imports under consideration

Amid supply uncertainty, the government has moved to secure around 300,000 tonnes of diesel from alternative suppliers outside its existing long-term contracts.

Officials said the fuel will be procured through the direct procurement method (DPM) to expedite the process. Discussions are currently underway with several North American suppliers to arrange emergency diesel shipments.

Speaking to TBS on Sunday, Energy Secretary Md Saiful Islam said the government is exploring every available option to ensure adequate diesel supply for April.

"So far we don't have that many problems in March. Keeping the supply uncertainty from long term contracts, we are exploring all sources to ensure around 3 lakh tonnes of diesel under DPM so that there is no disruption in the supply chain," he said.

Regarding when the supply will be confirmed from alternative sources, the energy secretary said, "We are trying to confirm delivery as soon as possible."

The authorities began exploring alternative sourcing options early, anticipating the lengthy approval process required for emergency purchases.

"There is an approval process involving the government's purchase committee. That is why we started the process earlier," Saiful Islam said.

Currently, Bangladesh imports refined petroleum products from eight countries – Malaysia, the United Arab Emirates, China, Indonesia, Thailand, India, Oman and Kuwait.

However, officials noted that a significant portion of petrol and octane is produced locally, helping reduce reliance on imports for these products.

Import disrupted

According to a fuel import scenario prepared by BPC on 7 March and presented before Prime Minister Tarique Rahman, the country planned to import 293,000 tonnes of diesel in March.

However, around 60,000 tonnes of diesel cargoes have either been deferred or cancelled, raising concerns about supply stability.

In its briefing to the prime minister, BPC noted that despite having contracts with suppliers from both the Near East and the Far East, geopolitical developments have made fuel supply increasingly uncertain.

In one instance, Singapore-based Vitol Asia cancelled a scheduled octane shipment for March, citing geopolitical risks in the Middle East.

According to BPC data as of 7 March, Bangladesh currently has 129,000 tonnes of diesel in reserve, which is enough to meet demand for around 14 days. The country also has 23,000 tonnes of octane, sufficient for about 25 days, and 15,000 tonnes of petrol, enough for roughly 15 days.

In addition, BPC reported 67,000 tonnes of furnace oil in reserve, which could last about 49 days, while Jet A-1 aviation fuel reserves stand at around 60,000 tonnes, also enough for roughly 49 days.

Mobile courts launched nationwide

To ensure uninterrupted fuel supply, the Cabinet Division has instructed all deputy commissioners to operate mobile courts across the country. This directive was issued in a letter from the Cabinet Division on Monday.

District authorities have been directed to take necessary measures accordingly.

Additionally, the Bangladesh Petroleum Corporation (BPC) has established central and regional monitoring and control cells to closely track fuel supply, maintain market stability, and resolve complaints promptly.

Special attention is being given to ensure that fuel supply for irrigation during the ongoing Boro season is not disrupted.

The Bangladesh Independent Power Producers' Association (Bippa) has urged the government to clear outstanding power bills owed to private power plants, warning that delays could disrupt fuel imports and lead to load-shedding during the upcoming summer.

The association said power producers are struggling to open letters of credit (LCs) to import fuel due to delayed payments at a time when global energy markets remain volatile amid the ongoing Middle East conflict.

The appeal was made at a press conference held in the capital yesterday by Bippa, which represents privately owned power plants in the country. Former Bippa president Imran Karim presented an overview of the current power sector situation at the event.

Bippa said outstanding payments owed to private power producers have reached around Tk14,000 crore, making it increasingly difficult for companies to maintain operations.

Under existing power purchase agreements, electricity bills are supposed to be settled within 30 days, but payments are currently being delayed by 180 to 270 days, according to the association.

Such prolonged delays have created severe financial pressure for power plant operators, making it difficult to procure fuel and sustain electricity generation.

"If the payments are cleared, fuel can still be imported even under difficult global conditions, including the ongoing war situation," Imran said.

To address the issue, Bippa suggested that the government could adopt a similar approach to the one taken by the previous interim administration.

Imran noted that the interim government had earlier issued Tk5,000 crore in bonds to partially clear outstanding payments to power producers.

The move, along with regular bill payments afterward, helped stabilise the sector and ensured uninterrupted electricity supply during last summer, he said.

"As a result, there was no major load-shedding during last year's summer," Imran said, adding that the current government could also issue bonds or allocate funds to settle the dues and avoid a similar crisis this year.

Effective power capacity lower than installed capacity

Although Bangladesh's installed electricity generation capacity exceeds 28,000 megawatts (MW), a large portion of that capacity remains idle due to fuel shortages and other operational constraints, power plant owners noted.

According to Bippa, more than 6,000MW of generation capacity remains unused because of insufficient gas supply, while another 1,626MW is currently offline for maintenance.

In addition, solar power is unavailable at night, and many diesel-fired plants remain shut due to high operating costs.

As a result, the country's effective available capacity during peak demand stands at around 18,627MW, and actual generation could reach about 18,000MW if fuel supplies remain stable, Imran said.

Fuel costs rising faster than electricity tariffs

Imran also pointed out that global fuel price increases have significantly raised electricity generation costs.

According to his analysis, fuel costs for power generation have risen by about 95% over the past six years, while electricity tariffs have not increased at the same pace.

During the same period, operational costs of power plants have increased by 55%, adding further financial pressure on plant operators.

Meanwhile, about 70% of electricity consumption in Bangladesh occurs in residential, commercial, and agricultural sectors, where tariffs have increased by only 54% over the same period.

As a result, higher electricity generation would increase the government's subsidy burden, as production costs continue to rise faster than retail tariffs.

To ease pressure on electricity generation costs, Bippa called on the government to temporarily withdraw import duties on fuel used for power generation.

Specifically, the association proposed removing 34% duty on imported fuel oil and 22% duty on imported liquefied natural gas (LNG).

According to Bippa, such measures could help lower generation costs at a time when global energy prices remain volatile.

Gas shortages limiting power generation

Bippa President David Hasanat also noted that managing electricity demand during the upcoming summer could be challenging due to multiple constraints.

"The situation could become even more complicated due to the ongoing Iran war, which is affecting global fuel markets," he said.

Hasanat added that around 23% of the country's power plants are currently unable to operate due to gas shortages, further straining the electricity system. He noted that increasing gas supply in the short term remains difficult because of infrastructure limitations.

"There is no immediate scope to significantly increase gas supply, and the infrastructure needed to expand imports is also limited," he said.

Fuel reserves may last until early April

According to Imran, oil-based power plants currently have enough fuel reserves to operate until 7-10 April, although the situation may vary across facilities depending on individual fuel stocks.

"To keep these plants operational, it is essential to ensure a steady fuel supply and timely payment of bills," he said.

Responding to questions about reducing generation costs, Imran said operators of furnace-oil-based power plants have already made concessions.

He noted that the interim government had reduced the service charge on fuel imports from 9% to 5%, which plant owners accepted.

He also said power producers are not charging interest on overdue payments, despite bills remaining unpaid for up to nine months.

"In contrast, some suppliers in other sectors shut down operations due to unpaid bills, but private power plants have continued operating despite the outstanding dues," he said.

Despite the challenges, Hasanat said private power producers remain committed to supporting the government in maintaining the electricity supply.

"We are ready to support the government in maintaining a stable electricity supply. After all, if the country survives, we all will survive," he said.

Oil prices surged over $119 a barrel, hitting ‌levels not seen since mid-2022, on Monday as some major producers cut supplies and fears of prolonged shipping disruptions gripped the market due to the expanding U.S.-Israeli war with Iran.
Brent crude futures were up $13.02, or 14%, at $105.71 per barrel at 0917 GMT, while U.S. West Texas Intermediate (WTI) crude futures were ​up $12.16, or 13%, at $103.06.
In a whiplash session, Brent had earlier hit a high of $119.50 a barrel, indicating the biggest-ever ​absolute price jump in a single day, and WTI reached $119.48 a barrel. Before the surge on Monday, ⁠Brent had already climbed 28% and WTI 36% over last week.
The Strait of Hormuz, through which roughly one-fifth of the ​world's oil and liquefied natural gas typically passes, is virtually shut. Also boosting prices is the appointment of Mojtaba Khamenei to succeed his ​father Ali Khamenei as Iran's supreme leader, signalling that hardliners remain firmly in charge in Tehran a week into its conflict with the United States and Israel.
The war could leave consumers and businesses worldwide facing weeks or months of higher fuel prices even if the conflict, which started on ​February. 28, ends quickly, as suppliers grapple with damaged facilities, disrupted logistics and elevated risks to shipping.
U.S. gasoline contracts surged to ​their highest since 2022 at around $3.22 a gallon, at a time when U.S. President Donald Trump has told U.S. consumers the impact on ‌their cost ⁠of living would be limited ahead of mid-term elections in November.
Governments can release strategic petroleum reserves to counteract supply disruptions. U.S. Senate Democratic Leader Chuck Schumer called on Trump to make such a move and a French government source said on Monday that the Group of Seven nations would discuss this also.

Bangladesh has floated tenders to buy three more liquefied natural gas (LNG) cargoes from the spot market for April delivery in a desperate race to secure gas amid deepening turmoil in the Middle East.

State-run Rupantarita Prakritik Gas Co Ltd (RPGCL) sought delivery of the LNG cargoes in three phases between April 5 and April 13, a move that came four days after the company floated tenders to buy two cargoes of gas for March 15-16 and March 18-19 deliveries.

Bangladesh had to buy two LNG cargoes from the spot market after failing to attract bidders for two consecutive days, although at more than double the normal rate.

The move comes amid uncertainty over the timely arrival of LNG shipments from Qatar, as shipping in the Gulf remains severely disrupted after Tehran threatened to "set fire" to vessels in the Strait of Hormuz, while the US-Israeli war with Iran continues for a tenth day.

Located between Oman and Iran, and connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea, the strait is one of the world's most important oil chokepoints.

Bangladesh meets nearly 30 percent of its gas demand, equivalent to 2,650 mmcfd, through imported LNG as domestic output continues to fall short.

The country also spends roughly $1 billion per year to import more than 60 lakh tonnes of petroleum and relies heavily on the Hormuz route. It sources most petroleum from the Middle East, and more than half of LNG imports in 2025 passed through this chokepoint.

The Bangladesh Bank (BB) has relaxed rules allowing foreign investors to repatriate proceeds up to Tk 100 crore from sales and share transfers without prior approval.

The central bank issued a circular on Sunday, saying banks can now independently process such repatriations if the fair value of the transaction is determined by an independent valuer using approved valuation methods.

Previously, banks could approve transactions of only up to Tk 10 crore, with most cases requiring central bank permission.

The relaxed rules apply to both state-owned and private companies that are not listed on stock exchanges.

The central bank said the move aims to simplify procedures and make the country a more attractive destination for foreign direct investment.

For deals where the transaction value does not exceed the net asset value (NAV) based on the latest audited financial statements, banks can approve repatriation regardless of the amount involved.

For smaller transactions of up to Tk 1 crore, investors no longer need to provide an independent valuation report.

To ensure proper oversight, the circular instructs banks to form internal committees to verify valuation reports and approve repatriation requests.

For small transactions, the committee must be led by the chief financial officer, while deals of up to Tk 100 crore require the chief executive officer’s leadership. Members with professional qualifications, such as CFA certification, must be included.

The circular also introduces procedural improvements to speed up transfers. Banks must complete repatriation within five working days if no discrepancies are found.

The overall share transfer process must be finalised within 45 days of signing the memorandum of understanding or receiving BB approval, whichever comes later.

The escalating crisis in the Middle East has dramatically changed the outlook for Asian central banks, with the huge supply shock posing a difficult trade-off ​between underpinning growth and countering inflation.

For emerging Asian central banks, cutting interest rates has become a risky bet not just because of the added price pressure from higher ‌fuel costs, but the risk of triggering capital outflows through worsening terms of trade with the US.

The Reserve Bank of India, for one, expects to focus more on supporting growth by keeping interest rates low, sources have told Reuters. But a rush towards the safe-haven dollar, which is intensifying from the US-Iran war, may force it to ramp up intervention to prop up its weakening currency.

"We don't see a possibility of a near-term rate hike in India - we do not ​see retail fuel prices moving higher immediately," said Suvodeep Rakshit, economist at Mumbai-based Kotak Institutional Equities.

"At this stage, the immediate priority of the central bank will be what happens on FX. ​We expect them to continue intervening to curb volatility there. An afterthought will be the liquidity impact of that intervention and they will infuse liquidity ⁠as needed."

Thailand and the Philippines may be forced to reverse their dovish monetary policy stance, even as rising fuel costs hurt their economies, said Toru Nishihama, chief emerging market economist at Dai-ichi Life ​Research Institute in Tokyo.Market Research Reports

"Many central banks will face a tough decision as they come under pressure from both markets and governments," Nishihama said. "With no clear end in sight to the conflict, the risk of stagflation ​is heightening day by day."

Share markets plunged and the safe-haven US dollar rose in Asia on Monday as oil surged past $110 a barrel, stoking fears of a protracted Middle East war on global energy supplies and higher inflation that may force central banks to hike rates.

The trade-off is particularly acute for manufacturing-heavy economies like South Korea and Japan, which are dependent on global trade, stable markets and cheap raw material costs - all being undermined by the widening Middle ​East crisis.

South Korea's central bank, which kept rates steady in February, could take a more hawkish stance if inflation persistently stays a percentage point above its target, said Citigroup economist Kim Jin-wook.

"For now, ​we continue to believe BoK is unlikely to hike policy rate in response to a higher-than-expected oil price," with government steps to curb fuel prices limiting the pass through of oil moves on inflation, Kim said.

'THINK OF THE ‌UNTHINKABLE'

Developed market ⁠central banks, such as the Federal Reserve, also face a tricky act balancing growth, inflation and increasing political pressure.

The dilemma runs deep for the Bank of Japan. If crude oil prices stay at $110 for a year, that could knock 0.39 of a percentage point off growth, according to Nomura Research Institute, a huge blow to an economy with subdued potential growth of around 0.5 per cent to 1 per cent.Global Economy Insights

But unlike in the past when it could afford to pause rate hikes, the BOJ has less room now to look through price pressures with inflation having exceeded its 2 per cent target for nearly four years.

That means the BOJ will have little ​choice but to repeat its mantra of continued ​rate hikes, while staying mum on the timing ⁠of such a move that could draw the ire of an administration hostile to higher borrowing costs, analysts say.

Australia and New Zealand are typical of how economies in different cycles put policymakers in a difficult bind.

Sustained oil price hikes risk de-anchoring price expectations in Australia, where inflation is already elevated, said ​Jonathan Kearns, chief economist at Challenger who is also a former Reserve Bank of Australia official.

"If inflation expectations increase, which they obviously could in ​this period where we've had ⁠high inflation, that will mean that the Reserve Bank would need to have interest rates higher for longer in order to bring inflation back down."

New Zealand faces a different challenge as the economy has struggled to recover from the hit from past rate hikes.

"We suspect central banks, and the RBNZ in particular, may well have to tolerate higher inflation in the short run to avoid tightening into a slowing global economy," said Jarrod ⁠Kerr, chief ​economist at Kiwibank.

International Monetary Fund Managing Director Kristalina Georgieva said on Monday a 10 per cent rise in oil prices, if persistent through ​most of the year, would result in a 40-basis-point increase in global inflation.

"We are seeing resilience tested again by the new conflict in the Middle East," Georgieva said in a symposium in Tokyo. "My advice to policymakers in this new global environment is ​think of the unthinkable and prepare for it."

Prime Minister Tarique Rahman will inaugurate the Family Card programme today (10 March) at the T&T playground in Banani, adjacent to the Korail slum, aiming to deliver economic benefits directly to citizens' doorsteps.

At a press conference on the launching programme at the Secretariat yesterday (9 March), Finance Minister Amir Khosru Mahmud Chowdhury described the initiative as non-political, non-partisan, and fully transparent, noting that it is designed to ensure the benefits of the nation's economy reach every citizen.

Social Welfare Minister Abu Zafar Md Zahid Hossain detailed the programme, explaining that under the pilot phase, 37,567 female-headed households have been selected to receive allowances ahead of Eid in March.

Each eligible family will receive one Family Card covering up to five members, with additional cards issued proportionally for larger households, he added. "If a woman head of household already receives other government allowances, those will be cancelled, while benefits to other family members will continue," the minister explained.

Under the pilot, each household will receive a monthly allowance of Tk2,500, with plans to expand to include food assistance in the future.

A total of Tk38.07 crore has been allocated for the pilot, with Tk25.15 crore (66%) earmarked for direct cash transfers and Tk12.92 crore (34%) for data collection, system development, card preparation, and programme management.

The pilot covers 13 city corporations and 15 wards across 13 districts, supported by committees at ward, union, upazila, and district levels.

Ward committees collected detailed household information—including socio-economic status, family size, education, housing, assets (TV, fridge, computer, mobile), and remittance flows—which was then verified at union and upazila levels.

During the pilot, data from 67,854 female-headed households were analysed using a Proxy Means Test (PMT) or poverty index, classifying families into five categories: ultra-poor, poor, lower-middle-class, middle-class, and upper-class.

After verification, 47,777 households in the ultra-poor, poor, and lower-middle-class categories were confirmed, and the final 37,567 households were selected based on factors such as existing government allowances, employment, or pension status.

"The entire selection process is software-driven through the PMT, leaving no room for corruption, favouritism, or manual interference," the Social Welfare Minister stressed.

Each selected household will receive a modern smart Family Card equipped with a chip, QR code, and Near-field communication (NFC) technology to ensure safety and durability.

Minister Zahid Hossain said that households were deemed ineligible if any member received a salary, allowance, grant, or pension from government, autonomous, or state-owned institutions, if the female head worked as a teacher or staff member in an MPO-listed institution, or if the household owned commercial licenses, large businesses, luxury assets (cars, air conditioners), or savings certificates worth Tk500,000 or more.

The Family Card allowance will be disbursed directly from the Social Welfare Ministry's social security budget to beneficiaries' mobile wallets or bank accounts via the G2P (Government-to-Person) system, he added.

During data collection, beneficiaries' account information was gathered to ensure timely, accurate, and interference-free delivery of funds directly to recipients

The government is managing the country's overall economic activities with a careful eye on the global economic situation and various crises, Finance Minister Amir Khasru Mahmud Chowdhury said today (9 March).

"The economic challenges arising from wars and other global factors cannot be avoided. Our current activities and future economic projections are determined with these realities in mind," he said at a press conference held at the ministry's conference room to inaugurate the "Family Card" programme which launches tomorrow.

Responding to a question on whether the government would continue austerity measures in spending, he said all ministries have been instructed to plan programmes according to the prevailing situation.

"The upcoming budget will also be prepared considering these circumstances," he added.

Asked about securing oil supply from China, Khasru said, "For energy security, we are seeking cooperation from various countries. Energy security is extremely important for the country, so the government is in discussions with all countries that can supply energy and seeking their support."

He also highlighted the "Family Card" initiative as a landmark poverty reduction effort.

"To my knowledge, such a large-scale poverty alleviation programme has not been undertaken in Bangladesh before. Through this, we aim to deliver economic benefits directly to people at their doorstep," he said.

The minister emphasised that the initiative reflects a gradual shift toward a welfare state in Bangladesh.

"In the past, economic benefits were distributed through patronage systems. Now, the government is directly reaching the common people," he noted.

Mobile telecom operators have urged the regulator to ensure priority allocation of fuel and electricity for network operations, warning that disruptions in supply could affect nationwide connectivity.

Limited availability of fuel at filling stations is creating risks for maintaining uninterrupted telecom services across the country, Association of Mobile Telecom Operators of Bangladesh (AMTOB) said in a letter to the chairman of the Bangladesh Telecommunication Regulatory Commission (BTRC) yesterday (9 March).

Companies have also expressed concern about sustaining operations during the upcoming Eid holidays amid government indications of possible load shedding.

AMTOB Secretary General Mohammad Zulfikar said mobile operators rely heavily on diesel- and petrol-powered generators to keep networks running, particularly during power outages.

"If fuel supply becomes uncertain, it could hamper maintenance activities, generator operations and emergency responses required to keep the telecom network functioning," he said.

The association noted that telecommunications have been declared an essential service by the government and currently support more than 185 million mobile subscribers across the country.

Telecom infrastructure also plays a vital role in enabling emergency communication, public safety services, digital financial transactions, business operations and government services.

According to the letter, reduced fuel availability at some filling stations has already created operational challenges for operators.

AMTOB warned that insufficient fuel supply could lead to network outages across large geographical areas, instability in data centres, equipment damage and longer service restoration times.

To prevent such disruptions, the association requested the regulator to coordinate with relevant authorities to ensure priority fuel allocation for mobile network operators and tower companies.

It also called for uninterrupted fuel supply for core network facilities and data centres, assured fuel availability for base transceiver stations (BTS) and maintenance vehicles, and reduced load shedding at critical telecom infrastructure sites.

Bangladesh has been facing persistent energy challenges in recent times as the country remains heavily dependent on imported fuels, including liquefied natural gas, petroleum products and coal.

The war in the Middle East has raised concern of fuel supply, triggering the government to adopt rationing measures. Conflict has also sparked panic buying, creating shortages at fuel pumps.

A tanker carrying more than 27,000 tonnes of diesel reached the waters of Chattogram Port today (9 March), amid a nationwide fear of supply shortage ten days after the conflict in the Middle East broke out.

Shipping agents said four more diesel tankers are scheduled to arrive at the port within a week.

Together, the five tankers will bring about 147,205 tonnes of refined diesel imported from Asian countries, according to port and shipping sources.

The arrival comes at a time when diesel demand has increased due to panic buying following the war in the Middle East. To manage stock levels, the government has recently reduced the daily fuel supply.

Port sources said the tanker Xiu Chi, carrying 27,204 tonnes of diesel from Singapore, entered the port's maritime area earlier in the day. According to vessel tracking data from MarineTraffic, the tanker is currently anchored near Kutubdia.

Another tanker, Lian Huan Hu, is expected to reach the port tonight from Singapore with nearly 30,000 tonnes of diesel. The tanker SPT Themis is scheduled to arrive on Thursday carrying 30,484 tonnes.

Two additional vessels — Raffles Samurai and Chang Hang Hong Tu — are expected to reach the port next Saturday, each carrying around 30,000 tonnes of diesel.

Nazrul Islam, managing director of Pride Shipping Lines, the local agent for the four tankers, told The Business Standard that the vessels are expected to arrive within a week according to schedule.

"Once they reach the port waters, the unloading will begin sequentially," he said.

According to the Bangladesh Petroleum Corporation (BPC), the country's normal daily demand for diesel is around 12,000 tonnes. The five tankers together could meet roughly 12 days of demand.

However, since Sunday, the government has reduced daily diesel supply to about 9,000 tonnes to maintain adequate reserves. At that rate, the incoming shipments could cover around 16 days of demand.

Existing stockpiles are expected to last another 16 to 17 days, meaning the combined supply would be sufficient to meet nearly a month of the country's diesel demand.

BPC data shows that diesel accounts for about 70% of Bangladesh's total fuel consumption, with most of it imported directly.

According to the National Board of Revenue, Bangladesh imported 2.328 million tonnes of diesel from nine countries between July and February of the current fiscal year.

Of that total, 78% came from Singapore, Malaysia, and India, while no diesel was imported from Middle Eastern countries during the period.

The Group of Seven (G7) finance ministers will ‌discuss on Monday a joint release of oil from emergency reserves coordinated by the International Energy Agency, the Financial Times reported.

Three G7 countries, including ⁠the US, have so far expressed support for the idea, the FT said citing sources, and added that the ministers and the IEA Executive Director Fatih Birol will hold a call to discuss the impact of the Iran ‌war.

The ⁠report comes as oil prices surged more than 25% on Monday to their highest levels since mid-2022 as some major producers cut ⁠supplies and fears of prolonged shipping disruptions gripped the market due to the expanding US-Israeli ⁠war with Iran.

The IEA and the G7 presidency did not respond to ⁠requests for comment outside regular business hours.

Bangladesh Bank (BB) has appointed observers at National Bank, Al-Arafah Islami Bank, Premier Bank, and IFIC Bank to closely monitor their activities.

The central bank made the decision this week.

“The decision to appoint observers at these banks is part of a continuous process,” said Arief Hossain Khan, executive director and spokesperson of Bangladesh Bank.

Munir Ahmed Chowdhury, director of the Bank Supervision Department-12 of BB, has been appointed as an observer to the National Bank.

Mohammad Anisur Rahman, director of the Islamic Banking Regulations and Policy Department, has been assigned to observe Al-Arafah Islami Bank.

ANM Moinul Kabir, director of the Payment Systems Department-1, has been appointed to Premier Bank.

AKM Kamruzzaman, director of the Forex Reserve and Treasury Management Department-1, has been appointed to IFIC Bank.

The central bank usually appoints observers to banks whose financial health is deteriorating.

Observers take part in board meetings and monitor the banks’ operations. They are withdrawn once the financial health of the bank improves.

After the fall of the Awami League-led government on August 5, 2024, the central bank restructured the boards of 14 banks, including these four lenders.

The share price of British American Tobacco Bangladesh Company (BATBC) came under significant pressure after it reported a major loss and sharply reduced its dividend, triggering a negative investor reaction and a notable fall in the stock.

Around the annual disclosure on 2 March, the company's share price dropped by nearly 21% in four consecutive trading sessions.

The sharp fall came as the company, which has long been known for paying high dividends, significantly reduced its dividend payout this year, prompting many investors to sell their holdings.

Even before declaring the dividend, its share price had fallen 7% and after the news was widely reported, selling pressure intensified further. In the trading sessions following the publication of the news, the share price declined by around 21%, reflecting investors' concerns over the company's weak earnings performance and lower dividend declaration.

The company's share price today regained 2.41% to Tk216.80 on the Dhaka stock exchange, while the premier index DSEX rose 132 points in a positive sentiment.

BATBC recommended a 30% cash dividend for 2025, sharply lower than the 300% cash dividend it distributed in 2024, reflecting a significant decline in its financial performance.

The multinational tobacco company reported a loss of Tk136 crore in the October-December quarter of 2025, indicating a sharp deterioration in earnings due to declining cigarette sales and higher operating costs.

According to the company, earnings per share (EPS) fell by 67% for the year ended 31 December 2025, mainly due to lower turnover and increased operating expenses. Costs rose amid inflationary pressure and higher levels of operational activity in certain segments of the business.

In July 2025, the company shut down its Dhaka factory and transferred plant, machinery, and cigarette manufacturing equipment to its Savar factory. The forced closure, along with relocation and restructuring costs, created a one-off negative impact of Tk715 crore on operating profit compared to the previous year.

For the full year ended December 2025, the company's EPS stood at Tk10.81, while it posted a loss per share of Tk2.53 in the fourth quarter.

The company will hold its annual general meeting on 30 April, with the record date set for 1 April to approve the financial statements and proposed dividend.

Overall inflation rose to its highest level in ten months in February, climbing to 9.13 percent from 8.58 percent in January, according to data released by the Bangladesh Bureau of Statistics yesterday.

Economists say rising food prices ahead of Ramadan and election-related spending added to demand pressures, pushing the Consumer Price Index (CPI), a measure of the prices of a basket of goods and services, above 9 percent for the first time since May last year.

February also marks the fourth consecutive monthly increase since inflation touched a 39-month low of 8.17 percent in October.

Food inflation bore the brunt of the rise, jumping to 9.30 percent in February from 8.29 percent the previous month. Non-food inflation also edged higher, reaching 9.01 percent from 8.81 percent, reflecting continued pressure in housing, transport and healthcare.

Bangladesh has been struggling with persistent inflation for more than three years. The burden falls hardest on the poor and low-income households, who spend a disproportionate share of their earnings on food and have the least capacity to absorb price shocks.

Inflation moderated slightly in recent months, but the 12-month annual average rate remained above 8.5 percent in January even though Bangladesh Bank maintains a hawkish monetary policy stance aimed at curbing demand-driven price increases and stabilising the economy.

As part of its tightening measures, the central bank has kept the policy rate at 10 percent for nearly one and a half years.

In its latest monthly economic updates, the General Economic Division under the Planning Commission said the recent trend indicates continued pressure from food prices within the overall inflation framework.

Sectoral contribution analysis shows that food remains the largest contributor to headline inflation in January.

Food accounted for 43.06 percent of overall inflation in January, up from 40 percent in December. Fish and dry fish remained the highest contributors, although their share decreased from 43.34 percent to 32.27 percent, it said.

ELECTION SPENDING, SUPPLY PRESSURE

Zahid Hussain, former lead economist at the World Bank’s Dhaka office, pointed to a convergence of February-specific factors. “We cannot look at this solely through the lens of monetary policy.”

Noting that urban food inflation rose the most, he explained, “part of this increase seems linked to election-related demand”.

Campaign spending, providing snacks at tea stalls or serving biryani, boosts the food component and contributes to higher prices, he said.

On the supply side, he noted, “A major disruption at the ports in February increased inflation expectations and hoarding tendencies.”

The economist also explained that combined with the lean season for food production -- the peak winter season has ended, but the spring harvest has not yet arrived -- this created a double burden on food prices.”

Hussain went on to point out that non-food inflation also rose, particularly in the miscellaneous category, which went from 21 to 24 percent. Understanding this category is key, as it recorded the highest inflation.

CONTRACTIONARY POLICY ESSENTIAL: ECONOMISTS

Regarding monetary policy, Hussain said, “Without the contractionary stance, the situation would have been even worse. The new governor had discussed reducing the policy rate, but that option has been postponed in light of recent challenges.”

With the Middle East conflict between Iran and US-Israel now threatening fuel and import costs, he warned the outlook was worsening.

“Now, with the war adding further pressure, it’s like rubbing salt on the wound. Inflation, growth, and employment are all under strain, and the situation ahead does not look positive from any perspective,” he said.

Ashikur Rahman, principal economist of the Policy Research Institute, also agrees that the central bank’s monetary policy stance is the right way to handle the situation.

“The twelve-month moving average clearly shows that inflation is on a downward trajectory, indicating that the current contractionary monetary stance is beginning to yield results,” he said.

“Bangladesh’s real policy rate, calculated by subtracting the inflation rate from the policy rate, stands at roughly 1.5 percent, one of the lowest in South Asia,” he added.

He cautioned that any premature easing risked reigniting inflation and undermining macroeconomic stability.

Md Deen Islam, a professor of economics at Dhaka University, echoed a similar tone on keeping monetary policy unchanged.

“The limited impact of higher policy rates largely reflects weak monetary transmission in the banking sector. Lending rates and credit flows often do not adjust fully to policy signals due to structural inefficiencies and high levels of non-performing loans.”

“Much of the recent inflation in Bangladesh has been driven by supply-side factors -- rising food prices, exchange rate depreciation, and higher import costs for fuel and essential commodities -- which monetary policy alone cannot easily control,” he noted.

He emphasised that addressing inflation effectively requires a broader policy mix that combines prudent monetary management with improvements in supply chains, enhanced market competition, exchange rate stability, and fiscal coordination.

Bangladesh and India have agreed to resolve problems surrounding projects financed under India’s line of credit (LoC) assistance, following talks between Indian High Commissioner Pranay Verma and Bangladesh Finance Minister Amir Khosru Mahmud Chowdhury in Dhaka yesterday.

Speaking to reporters after the meeting, Khosru said they also discussed the progress of LoC-supported projects. “Hopefully, the projects will see further progress in the coming days.”

Verma described the meeting as “very positive and productive”, saying discussions focused on strengthening financial sector cooperation, expanding economic relations and other issues of mutual interest between the two countries.

Both countries remain satisfied with the progress of the ongoing projects, he said.

“Some initial challenges have emerged in a few large projects, but efforts are being made to resolve them,” he said.

The talks come against the backdrop of sluggish disbursement under the three LoC agreements signed since 2010.

Of a total commitment spanning 42 projects, only $1.88 billion was disbursed by June 2024 against cumulative LoC deals worth over $7 billion, while Bangladesh repaid $254 million.

The first LoC, worth $862 million for 15 projects, was signed in 2010. The second, worth $2 billion for 12 projects, was signed in March 2016. The third credit deal, amounting to $4.5 billion, was signed for 15 projects in October 2017.

Just 14 of the 42 projects have been completed, at a cost of roughly $410 million, or about 6 percent of the overall commitment under the first two credit lines.

Beyond the LoC, the two sides discussed a broader range of bilateral issues, including trade, customs, financial sector cooperation and digital infrastructure.

Verma said Bangladesh’s priorities in the financial sector were discussed during the meeting, including improving the ease of doing business, tax reforms and expanding the use of technology to ensure broader participation in economic activities.

The Indian envoy said he briefed the finance minister on India’s experience expanding financial inclusion through its digital public infrastructure.

The two sides also discussed development projects being implemented jointly by the two countries.

On trade, the Indian high commissioner said both sides emphasised the need to further strengthen bilateral trade and economic ties.

Discussions also focused on making existing connectivity through sea, land and air routes more efficient to facilitate trade and business activities.

“If various processes can be simplified as part of ease of doing business, cooperation between businesses of the two countries will increase,” Verma said.

He added that this would help boost bilateral trade as well as increase Bangladesh’s exports to the Indian market.

The meeting also discussed ways to integrate the two economies more closely at both bilateral and regional levels, he said.

Verma said constructive discussions would take place in the future regarding the potential use of ports between the two countries.

He added that stronger bilateral relations could be built in the future based on shared development priorities, new ideas, technology and people-centric cooperation.