The shift toward electric vehicles, renewables, battery storage and expanded power grids is driving a surge in demand for copper, rare earths, silver and other materials.
But the electrification push is starting to create its own supply, too.

According to the International Energy Agency, clean energy technologies require far larger quantities of minerals than conventional energy systems, and demand linked to the energy transition is only set to grow over the coming decades.

That accelerating demand contrasts with a supply outlook for key materials which is constrained by new mines, refining capacity and processing infrastructure that can take years to develop.
That conundrum is forcing governments and companies to rethink where future supplies will come from.

An increasingly viable source of new supply is coming from an unexpected source: energy-transition infrastructure itself.

Around the world, breakthroughs in recycling are turning old batteries, retired solar panels, decommissioned wind turbines and aging grid equipment into increasingly valuable sources of the same materials needed to sustain energy-transition momentum.

What began as a waste-management challenge is evolving into a strategic industrial opportunity, as legacy energy-transition components become a resource base in their own right.

Batteries offer the clearest example of the growing importance of recycling to the supply picture.

For years, concerns about future battery supply focused on the availability of lithium, nickel, cobalt and graphite from mines.

But attention is now shifting toward recovering those same materials from batteries already in circulation.

US company Redwood Materials says it recovers more than 95 percent of lithium, nickel, cobalt and copper from spent batteries and manufacturing scrap.

The company processes more than 20 gigawatt-hours of lithium-ion batteries annually and produces more than 60,000 metric tons of critical materials each year.

It describes those recovered materials as a growing domestic source of supply that can reduce dependence on new mining and imports.

With the first generation of large-scale EV batteries now reaching maturity, the volume of available batteries should continue to climb.

This, in turn, may encourage more widespread recycling that can reduce demand for fresh battery components.

The impact on global supply could be meaningful.

Between 20 percent and 30 percent of global lithium, nickel and cobalt demand could come from stepped-up recycling efforts by 2050, according to the IEA.

In Europe, which has some of the world’s most ambitious materials recycling policies, researchers have estimated that roughly 15 percent of lithium, nickel and manganese and around 25 percent of cobalt supplies could come from recycling sources by 2030.

Solar energy faces a similar opportunity.

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The industry is adding generating capacity at record rates, but is also consuming large quantities of silver, silicon and other materials to manufacture arrays.

Recycling efforts have so far focused mainly on recovering glass and aluminium from retired panels; other materials have often remained difficult or uneconomic to recover.

But a series of recent technological breakthroughs is improving the economics of solar-panel recycling, allowing valuable materials such as silver and silicon to be recovered more efficiently.

Researchers at the Netherlands Organisation for Applied Scientific Research recently demonstrated a laser-assisted recycling process capable of recovering silicon with purity levels of up to 99.998 percent and silver with purity of 99.7 percent, while achieving recovery yields of roughly 97 percent.

In Australia, researchers at the University of Newcastle have demonstrated nearly 100 percent silver recovery from end-of-life solar panels using flotation techniques already familiar to the mining industry that are commercially scalable.

Such high recovery rates of some of the most sought-after components of solar arrays have the potential to elevate solar recycling from a side hustle into a lucrative industry.

Indeed, energy consultants at Rystad Energy estimate that the total value of recyclable materials from solar panels could rise from around $2 billion currently to roughly $80 billion by 2050 given the scale of global deployment of solar systems and the expected increase in materials prices.

By 2035, as much as 8 percent of the polysilicon, 11 percent of the aluminum, 2 percent of the copper and 21 percent of the silver needed for solar panel production could come from recycling panels installed in 2020, according to Rystad research.

Future solar deployment may therefore increasingly not need to draw on newly produced silver and silicon but instead look to materials harvested from earlier generations of solar farms.

Wind power is experiencing its own recycling breakthrough.

A wind turbine can already be substantially recycled, but the blades have long represented a technical challenge because of the composite materials used in their construction.

However, recent advances suggest a solution is coming into view that could emerge as a boon for cement makers and construction firms looking to reduce their own carbon footprints.

French multinational Veolia has developed a process that shreds previously unrecyclable fibreglass blades into pellets that can replace coal, silica and limestone in cement kilns.

US company REGEN Fiber applies a similar process to create reinforcement fibers for the concrete, asphalt and composite industries.

While the output of these processes does not produce inputs for the renewable energy industry itself, the recycled materials can displace significant volumes of virgin raw materials in the cement and construction sectors.

An analysis by Quantis US, an environmental consulting firm, found that feeding a shredded 7-metric-ton blade into a cement kiln reduces coal use by 5 tons while avoiding 2.7 tons of silica, 1.9 tons of limestone and nearly 1 ton of additional minerals.

In turn, recycled turbine blades can reduce demand for energy-intensive mining, quarrying and materials processing, lowering the overall resource and emissions footprint of the energy transition.

One of the least discussed recycling opportunities lies within the power grid itself.

Countries are embarking on massive grid-expansion programs to accelerate renewables generation, electrify transportation and support rising electricity demand.

Those investments require enormous quantities of copper, aluminium and steel.

Much of the discussion around these plans focuses on where those materials will come from, overlooking the vast stocks already embedded within aging infrastructure.

Utilities are replacing transformers, substations and transmission equipment that in many cases contain large volumes of high-quality copper, aluminium, steel and other key components.

Recycling programs are increasingly recovering these materials and returning them to industrial supply chains.

US steelmaker Nucor operates specialized recovery facilities that process retired equipment to double their volume of reclaimed copper and non-ferrous metals, which are used in the construction of new transmission components.

That opportunity will grow as grid modernization accelerates.

Every retired transformer and transmission asset represents a concentrated source of refined materials that can be redeployed into the next generation of electricity infrastructure.

The common theme across batteries, solar panels, wind turbines and grid equipment is that the energy transition is creating its own expanding inventory of recoverable materials.

Mining will remain indispensable, of course.

Global demand growth remains too large for recycling alone to meet.

But the industry is increasingly discovering that future supply does not depend exclusively on what can be extracted from the ground.

As concerns grow over critical-mineral shortages and supply-chain security, the most important new mine of the energy-transition era may prove to be the one that has already been built.

G7 countries agreed Friday to release 100 million barrels of diesel and crude oil to ease global energy supply concerns, as President Donald Trump hailed the decision and said the US would not impose a threatened diesel export ban.
The announcement came following a video conference of G7 leaders chaired by French President Emmanuel Macron after Washington stepped up pressure on Europe to release strategic reserves and threatened a diesel export ban.The talks, convened by Macron after a conversation with Trump, focused on coordinating a response to soaring fuel prices among the other G7 economies of Britain, Canada, Germany, Italy, Japan and the United States.

The US-Israeli war with Iran has sent energy prices skyrocketing, coming back to bite Trump at home with high fuel costs that have become a key issue ahead of midterm congressional elections in a month.

Trump had floated the possibility of banning US exports of diesel, which is used in trucks and other hauling vehicles, an alarming prospect for the EU, which relies heavily on fossil fuel imports.

The seven countries agreed to a coordinated release through the International Energy Agency (IEA) of 100 million barrels "to begin immediately over four months, including a frontloaded substantial diesel release within the first 20 days," the leaders said in a statement released by Macron's office.

They also said there would be no ban on diesel exports between them.

"We reaffirm our commitment to refrain from export restrictions on energy and energy products between G7 countries and call on all producers to refrain from imposing bans that could exacerbate market tensions," the leaders said.

"Our citizens' concerns about energy prices remain a top priority."

Trump said European countries had agreed to release a "massive amount" of diesel from their reserves.

"The process will begin immediately," he posted on his Truth Social network.

"Europe has a lot of diesel and they're going to be making a major world contribution -- and so are we," Trump said later, adding "Europe did a great thing".

"And we're not going to be doing the export ban," he said.

- US pressure -
Earlier the EU pushed back hard against US threats to impose a diesel export ban, something Macron also warned against during his conversation with Trump.

The flurry of diplomatic activity came a day after US Treasury Secretary Scott Bessent cranked up the pressure on European nations.

"American farmers, truckers, and businesses should not be left carrying the burden of a global diesel shortage," he said.

US Energy Secretary Chris Wright likewise held talks with his British counterpart Miatta Fahnbulleh on the crisis, including on the UK's strategic reserves.

British dairy farmer Keith Blackshaw, in the Derbyshire hamlet of Newhaven, complained of a "vicious circle" with high fuel prices being passed onto customers.

"I'd like to see Mr Trump support us a little bit more really," the 69-year-old said. "He looks after his own. Maybe we should do the same, look after our own."

The 32 members of the IEA agreed last March to unlock 400 million barrels of oil from reserves, their largest release ever.

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- 'Sanctions against Russia' -
Earlier this week, IEA chief Fatih Birol said European nations had yet to release part of those stocks, which could happen soon.

About a third was yet to come to market, Birol said, adding that further releases were possible since 80 percent of overall IEA stocks were "still in our pocket".

Diesel prices in the United States and Europe have hit record highs in recent weeks, with an export ban imposed by major producer Russia in response to Ukrainian attacks on fuel facilities also contributing to global market pressures.

The G7 leaders said on Friday: "We will maintain sanctions against Russia while working with the IEA and global partners to prevent further spillovers into fuel, gas, and other commodity markets."

Energy prices surged in the eurozone in September, pushing inflation to 3.8 percent, the highest level in three years.

Policy-based lending by the Asian Development Bank (ADB) is expected funnel several-hundred million dollars into government's ambitious recipe to heal electricity crises by enhancing solar-power generation, officials said.

A team of the ADB, led by its Director of the South Asia Energy Team Sujata Gupta, held out the support in meetings with the officials from Finance Division, Power Division, Sustainable and Renewable Energy Development Authority (SREDA), Bangladesh Energy Regulatory Commission (BERC) and Bangladesh Power Development Board (BPDB) during three days ending Thursday.Track Investments

Earlier, the Power Division had requested the ADB support through policy-based lending to accelerate renewable-energy development, reduce reliance on fossil fuels, promote clean and environmentally sustainable electricity generation, reduce power-sector subsidies, strengthen sector sustainability, and contribute to the achievement of the UN-designated Sustainable Development Goals.

The Power Division also had requested the Finance Division to seek $2.0 billion from the ADB to materialise its rooftop solar power ambition. Subsequently, the Finance Division requested the Economic Relations Division to place the proposal to the ADB for getting the loan "as soon as possible".

Sources said during the meetings with the officials, the ADB team discussed the government priorities and ongoing policy and regulatory reforms for accelerating renewable-energy development.

Also, they reviewed recent policy and regulatory and institutional measures to identify key constraints to scaling up renewable energy investment, including private-sector participation, sources said.Access Services

Moreover, they discussed issues and areas for identifying potential policy actions that could be supported under the proposed ADB policy-based loan.

Also, the proposed policy-reform areas and implementation arrangements came into discussion during the meetings, sources familiar with the developments said.

According to officials concerned, initially, the ADB officials said they would bring forward US$100 million from the pipeline and add some more to the amount for releasing several hundred million dollars to help materialise the government's solar- power ambitions.

The size of the proposed policy-based loan and an indicative timeline for processing the loan will be finalised after having meeting with the top officials from the ERD, sources said.

In exchange, the ADB asks Bangladesh to carry out reforms for financial sustainability, energy-ecosystem development, and integration of renewable energy in grid system, according to officials concerned.Get Solar Panels

In the recent weeks, the government has taken a range of measures to accelerate renewable-energy deployment. It has issued several regulatory orders and notifications to incentivise rooftop solar development, introduced policy directions to promote private- sector investment in merchant power plants, and issued guidelines to facilitate renewable- energy projects through public-private partnerships on land owned by state-owned entities.

The government also set target to generate an additional 3,000 to 4,000 megawatts of electricity from rooftop solar before next summer to avoid the possible power crisis then.

Also, the government high-ups ordered diversion of necessary funds from the development budget as the private-sector renewable-energy producers suggested creation of funds for financing rooftop solar-power generation.

Following that, a Tk 15-billion fund has been created by repurposing Tk 10 billion from budgetary allocation for Small and Medium Enterprise (SME) sector and Tk 5.0 billion from operating loans.Compare Utilities

President of Bangladesh Sustainable and Renewable Energy Association (BSREA) Mostafa Al Mahmud told The Financial Express a large sum of financial support is necessary to materialise the government's target of generating 3,000 to 4,000MW electricity from rooftop solar before next summer.

"Foreign funds can be a good option for the government since many multilateral development partners provide low-cost funds for clean energy generation," he said.

The government's economic priorities include restoring macroeconomic stability, controlling inflation, reforming the tax system and strengthening governance in the banking sector, Finance Minister Amir Khosru Mahmud Chowdhury said on Saturday.

He also identified restoring confidence in the banking sector, increasing investment and creating employment as major challenges for the economy.

The minister made the remarks as chief guest at the Grand Finale of ECONTHON 2026, a national inter-university economics competition, held at United International University (UIU) in the capital.

"Inflation was putting pressure on people's purchasing power, while tax collection as a share of gross domestic product remained far below the level required to meet the country's development needs," he said.

Calling for structural reforms in the tax system, Khosru said it should be made fair, simple and technology-driven. He also stressed the need to improve the environment for private investment to support economic growth and employment.

The finance minister said the country also needed to ensure better returns from public spending on education, health and social protection. "Policy should be based on data and evidence," he said, adding that policymakers must assess whether a policy is implementable, how much it will cost, who will benefit and who will bear the burden.

He said Bangladesh's export sector would increasingly need to rely on competitiveness rather than trade preferences as the country prepares for graduation from the least developed country (LDC) category.

"There is no benefit in hiding problems; acknowledging them is where solutions begin," he said.

Khosru also pointed to growing uncertainty in the global economy, citing slower growth, higher financing costs, rising protectionism and tariff barriers, geopolitical conflicts and increasing economic losses caused by climate change.

"Uncertainty in the global economy has become a normal reality," he said.

For an import-dependent and export-oriented economy like Bangladesh, such global shocks directly affect commodity prices, the exchange rate and export orders, he added.

He also said the country was preparing for LDC graduation irrespective of the timeline, stressing the need to strengthen economic competitiveness to cope with the changing global trade environment.

The programme was organised by the Junior Economists Forum (JEF) of UIU in collaboration with its Department of Economics.

A total of 224 teams from universities across Bangladesh registered for ECONTHON 2026, which sought to help students apply classroom knowledge to real-world economic challenges while developing analytical thinking, problem-solving, adaptability, creativity and economic reasoning.

ECONTHON 2026 had a total prize pool of Tk 265,000. The team "Vini Vedi Vici" from North South University was crowned grand champion and received Tk 100,000.

Team "Shield" from the University of Dhaka secured the first runner-up position and received Tk 75,000, while team "Dhaka-99" from UIU secured the second runner-up position and received Tk 50,000.

Hasan Mahmood Raja, chairman of the Board of Trustees of UIU and chief adviser of United Group, attended the programme as the guest of honour, while KMA Shamim, member of the Board of Trustees of UIU and adviser of United Group, was present as a special guest.

The programme was presided over by Md Abul Kashem Mia, vice chancellor of UIU, and moderated by Mohammad Omar Farooq, head of the UIU Department of Economics.

Bilateral trade between Bangladesh and China reached a record US$12.8 billion in the first half of 2026, up 10.6 per cent year on year, the Chinese embassy in Dhaka said on Wednesday.

In a statement marking the 77th anniversary of the founding of the People's Republic of China, the embassy highlighted expanding cooperation in trade, investment, infrastructure and healthcare.

China remained Bangladesh's largest trading partner for 16 consecutive years from 2010 to 2025, the statement said.

Bangladeshi agricultural products, including fresh mangoes and jackfruits, have gained access to the Chinese market, while efforts are underway to secure market access for guavas and aromatic rice.

The two countries are also implementing a joint action plan to enhance Bangladesh's export capacity and improve the structure of bilateral trade, the embassy said.

Alongside growing trade, China's cumulative investment in Bangladesh reached approximately US$3.6 billion as of June 2026, according to the statement.

Chinese direct investment in Bangladesh increased by approximately 50 per cent year on year in 2025, it said.

Since the establishment of the new government, five Chinese-invested enterprises have invested more than US$100 million in Bangladesh, creating nearly 20,000 jobs, the embassy added.

The China Economic and Industrial Zone in Chattogram was officially launched in July 2026 and has attracted intended investments totalling US$500 million.

The zone focuses on developing textiles and garments, machinery manufacturing, electronics and information technology, biomedicine and green energy industries, the statement said.

Highlighting infrastructure cooperation, the embassy cited the Padma Bridge, constructed by a Chinese company, as a major project connecting Dhaka with 21 districts in southwestern Bangladesh.

The bridge is estimated to contribute 1.23 percentage points to annual GDP growth and reduce the poverty rate by 0.84 percentage points, according to the statement.

Chinese companies have also undertaken coal-fired, solar and wind power projects with a combined installed capacity exceeding 1,000 megawatts, it said.

Several China-aided projects are currently under construction, including the burn unit at Chattogram Medical College Hospital and the renovation of Bangladesh-China Friendship Bridge-6.

Other projects, including a general hospital, a women's hall of residence at the University of Dhaka, Bangladesh-China Friendship Bridge-9 and an emergency management centre, are also progressing, the embassy said.

In healthcare and humanitarian assistance, China has provided Bangladesh with donations worth more than US$4 million in recent years, according to the statement.

The assistance included dengue and Cocid-19 testing kits, medicines and ventilators for burn treatment, robotic rehabilitation equipment and flood relief supplies.

China has also supported the construction of a 1,000-bed general hospital and the burn unit project at Chattogram Medical College Hospital, it added.

The embassy said these initiatives reflected China's support for Bangladesh in times of need and its contributions to safeguarding the health and well-being of the Bangladeshi people.

Textile and Jute Minister Khandakar Abdul Muktadir yesterday said the government is working to convert raw jute into high-value products to maximise foreign exchange earnings and revenue.

The government is also promoting promising sectors beyond readymade garments (RMG), including silk, handloom and diversified jute products, he said while inaugurating a six-day “Multipurpose Jute Products Fair” and the sales outlet “JDPC EXPRESS” at the Jute Diversification Promotion Centre (JDPC) premises in Tejgaon, Dhaka, as the chief guest.

A permanent showroom is being launched at the JDPC to promote these products and expand their markets, he said.

The government aims to attract local buyers through fairs and exhibitions while raising awareness of these products among foreign buyers, he added.

The minister said the products include both machine-made and handmade items, with the latter mostly produced by cottage and small industries.

Replying to a question on the diversification and export expansion of jute goods, Muktadir said a plan was being developed in coordination with the JDPC and private-sector entrepreneurs’ associations.

There is little value addition in exporting raw jute, but its value can be multiplied by gradually converting it into high-value products such as sliver, packaging materials and blended fibre, he said, expressing optimism about the sector’s prospects.

The government is also working to make the country’s GI products, multipurpose jute goods, Rajshahi silk, handloom and other textile products better known and more widely used, Muktadir said.
“At the peak of the market last year, raw jute was priced at around Tk 1.5 lakh, or about $1,200, per tonne,” the minister said.

He said the same quantity of jute could fetch around $2,400-$2,500 if converted into packaging products.

Blended fibre products made by mixing jute with cotton or other fibres could earn around $4,000-$5,000 per tonne, he added.

The government’s goal is to convert the largest possible share of the country’s jute output into value-added products, Muktadir said.

“Work is under way in coordination with relevant institutions and entrepreneurs to determine how much jute can be used in which sectors and for what kinds of products.”

He expressed hope that these efforts would help maximise foreign exchange earnings and revenue from jute.

State Minister for Textiles and Jute Shariful Alam said the fair aims to promote local products in the domestic market, expand the use of eco-friendly goods and discourage the use of polythene.

The government is also working to make the country’s geographical indication (GI) products, diversified jute goods, Rajshahi silk, handloom and other textile products better known and more widely used, he said.

“The golden fibre jute was once tied to the country’s pride and people’s emotions, but much of that heritage has been lost over time,” he said.

Such fairs are being organised as part of efforts to increase jute production, expand the use of diversified jute products, develop domestic and international markets, and generate more value from the fibre, he added.

The JDPC organises such fairs at various locations across the country every year, Shariful said.

He said “JDPC EXPRESS” would operate as a permanent sales and display centre, offering diversified jute products alongside handloom and silk items. There are also plans to set up similar showrooms at other important locations in the future.

The government is also considering setting up showrooms or display centres for local products at international airports and Bangladesh’s missions abroad.

To raise awareness and promote the use of these products at home and abroad, they need to be effectively marketed internationally, he said.

“With the cooperation of entrepreneurs and the media, the government wants to showcase local products more widely in the global market.”

The six-day fair will run from October 3 to 8, from 10am to 8pm daily.

The new outlet, “JDPC EXPRESS”, will remain open seven days a week, from 11am to 8pm.

Global food commodity prices rose further in September, with the FAO Food Price Index increasing 1.5 per cent month-on-month amid transport disruptions, adverse weather and tighter supply expectations, while international rice prices also moved higher.

The Food and Agriculture Organisation of the United Nations (FAO) said its Food Price Index averaged 136.0 points in September, up from the revised August level and 5.8 per cent higher than a year earlier.

The index, which tracks monthly changes in international prices of a basket of globally traded food commodities, has now come under broader upward pressure as disruptions to major shipping routes and weather-related production concerns affect several food markets.

FAO Chief Economist Maximo Torero said disruptions in the Strait of Hormuz and the Black Sea, combined with climate shocks, were putting pressure on energy, transport and key food commodities.

He warned that if the pressures persist, they could eventually pass through to consumer food prices, particularly in countries dependent on food and energy imports.

Among the major commodity groups, cereals recorded one of the sharpest increases in September. The FAO Cereal Price Index rose 5.1 per cent from August and was 17.2 per cent higher than its level a year earlier.

Wheat prices increased 6.3 per cent during the month, mainly because of logistical constraints in the Black Sea region and dry weather in parts of North America ahead of the sowing season.

Global maize prices also rose 5.6 per cent as concerns over yields in the United States, reduced export availability from Brazil and disruptions to Black Sea trade pushed prices higher.

The rise in cereal prices is particularly important for food-importing countries because wheat and maize are major inputs for food, feed and other agricultural value chains.

Rice prices also increased in September, although at a more moderate pace than the broader cereal market.

The FAO All Rice Price Index rose 1.4 per cent from August, as Indica rice quotations increased amid weather concerns and seasonally tighter supplies.

The rise follows a 0.5 per cent increase in the rice index in August, indicating that international rice prices have remained under upward pressure in recent months.

FAO said the strengthening El Niño is adding further uncertainty to rice production prospects, particularly in South and Southeast Asia, where weather conditions have a significant influence on global rice supplies.

According to FAO, global rice output in 2026 is now forecast at 552.5 million tonnes, with lower production prospects in India, largely due to poorly distributed monsoon rainfall, outweighing improved forecasts for Japan and Nepal.

The agency expects international rice trade to decline 2.2 per cent in 2026 before recovering 1.7 per cent in 2027.

FAO said rice yields globally tend to be 1.0 to 1.5 per cent below their expected trend during El Niño events, adding another layer of uncertainty to the supply outlook.

The overall food price increase in September was broad-based across several crop-related commodities. The Vegetable Oil Price Index rose 0.9 per cent, driven mainly by higher palm oil prices amid strong global import demand and concerns over dry weather in Southeast Asia.

The Sugar Price Index recorded a larger increase of 6.1 per cent, reflecting expectations of tighter global supplies in the 2026/27 season.

However, not all food categories became more expensive. The Meat Price Index fell 1.1 per cent in September, while the Dairy Price Index edged down 0.1 per cent.

The latest rise in the overall index comes against a backdrop of a still-large global cereal harvest. FAO forecasts 2026 global cereal production at 2,979 million tonnes, down 2.1 per cent from 2025 but still the second-largest harvest on record.

Despite the expected decline in production, global cereal stocks are forecast at 950 million tonnes at the close of the 2026/27 season. The cereal stocks-to-use ratio is projected at 31.7 per cent, indicating that global supplies remain relatively substantial.

Nevertheless, logistical disruptions, higher freight rates, firmer fertiliser markets and weather uncertainty are increasing risks to food price stability.

For rice-dependent Asian economies, the combination of tighter seasonal supplies, weather risks and the strengthening El Nino could remain an important factor in international food markets in the months ahead, said FAO.

The government has reined in bank borrowing after a spree early in the fiscal year, with analysts blaming the sluggish pace of development work.

Bangladesh Bank data show the government borrowed Tk 166.01 billion from commercial banks in July and August, the first two months of the fiscal year, while repaying Tk 37.28 billion owed to the central bank.

That leaves net borrowing from the banking system at Tk 128.72 billion for the period. July accounted for Tk 74.69 billion, falling to Tk 54.03 billion in August.

The first 13 days of the fiscal year alone saw net borrowing of Tk 92.09 billion, of which Tk 54.14 billion came from Bangladesh Bank and Tk 37.95 billion from commercial banks.

Central bank borrowing pumps fresh money into the economy, potentially adding to inflation by increasing demand.

Inflation has eased but remains above 8 percent.

Fuel prices have been raised by Tk 20 a litre in one go, increasing transport costs and adding to price pressures across the economy.

The new government pay scale has also sharply increased salaries and allowances for public employees.

Central bank officials say concerns that these factors could push inflation higher help explain why the government is now repaying Bangladesh Bank rather than borrowing from it.

Bangladesh Bank spokesman Arief Hossain Khan told bdnews24.com that borrowing typically swells at the start of a fiscal year.

“Revenue collection is low, and more has to be borrowed to meet essential expenses,” he said. “That happened this time too. It is easing now, but it could rise again.”

Borrowing from banks or the public to cover budget deficits is a normal process, Arief said, as the government needs to finance development projects.

Supplying the government with loans through treasury bills and bonds when required is part of the central bank's role, he added.

“We are only doing that job. How the loans will be repaid is for the government to worry about. If it cannot collect the revenue it expects, it has to run the country on borrowing. That is natural.”

Commercial banks' outstanding loans to the government stood at Tk 6.08 trillion on Aug 31, up from Tk 5.91 trillion at the end of June.

Outstanding central bank borrowing fell to Tk 903.22 billion in August from Tk 940.51 billion in June.

The latest report from the Implementation Monitoring and Evaluation Division (IMED) of the planning ministry shows less than 2 percent of the Annual Development Programme (ADP) was implemented in the first two months of the fiscal year.

Ministries and divisions spent Tk 57.10 billion during the period, just 1.85 percent of the total ADP.

Bangladesh has never before recorded such a low rate of development spending in the first two months of a fiscal year.

For FY27, the government has set a target of borrowing Tk 1.12 trillion from the banking system. It has already drawn 11.49 percent of that in two months.

The government sets a bank borrowing target in the budget each year to help finance the deficit.

The FY26 target of Tk 1.04 trillion was raised to Tk 1.18 trillion in the revised budget, but actual borrowing ultimately reached Tk 1.32 trillion.

In FY25, the government borrowed Tk 1.19 trillion against a target of Tk 1.17 trillion.

The National Board of Revenue (NBR) previously published monthly revenue figures in the first week or around the middle of the following month. Three months into the fiscal year, covering July to September, it has yet to release figures for a single month.

NBR officials say the figures have not been released because revenue collection has fallen short of target.

Zahid Hussain, former lead economist at the World Bank's Dhaka office, told bdnews24.com it was positive that the government was repaying the central bank rather than borrowing from it.

“That may ease the pressure on inflation,” he said. “But the fuel price rise and the pay increase for government employees will push up government spending, and inflation too.

“There are hardly any steps to boost revenue collection. So spending will climb further, and so will borrowing.”

The latest Bangladesh Bureau of Statistics (BBS) data put point-to-point inflation at 8.26 percent in August, down from 8.32 percent in July.

Announcing the October-December monetary policy on Wednesday, Bangladesh Bank Deputy Governor Habibur Rahman warned of several risks to the inflation outlook.

Higher fuel prices could raise transport and production costs, he said, while implementing the new government pay structure could add to inflationary pressure.

“The recent decline in overall inflation is not enough proof of a sustained fall, because inflation remains vulnerable to supply and cost pressures,” he said.

Habibur cited rising global fuel prices, the stalemate in the Strait of Hormuz, the recent increase in administered fuel prices and the possible impact of the national pay structure among the main risks.

“Easing monetary policy before the right time could lift inflation expectations and delay the return to the inflation target,” he added.

An inspection report by the US aircraft manufacturer Boeing claims that Biman is struggling to maintain its existing fleet.

Chronic shortages of spare parts and tools are forcing Biman to keep flying with components that should have been repaired long ago, while an inadequately trained workforce is contributing to disruptions, says the report of October 2025.

An expert sees no immediate safety concern, but the findings raise questions about Biman’s ability to support a much larger fleet.

Its challenge is not just expanding the fleet but keeping aircraft in service reliably.

Biman Bangladesh Airlines has ordered 25 new Boeing aircraft this year.

The “Biman Bangladesh Airlines 777/787 Onsite Enhanced Support Close-Out Report” compares Biman’s 777 and 787 fleets with what the manufacturer describes as its global fleet standard. Boeing’s on-site maintenance team spent several months at Biman last year at the airline’s invitation, according to sources familiar with the exercise.

Of the 19 aircraft in Biman’s fleet, four are 777-300ERs, four 787-8s and two 787-9s.

Biman suffers many flight delays due to a high rate of odd technical issues, unlike other carriers’ Boeing fleets, and it takes Biman up to three times longer than “standard” to maintain its planes, the report said.

Of the top 10 problems identified in Biman’s and the global fleets, Biman’s 777s had only two in common with the global fleet -- the backup power system and the air-conditioning system’s cooling and temperature controls.

Biman’s 787s shared four, faults in a core computing unit known as the general processing module; the common motor start controller; and two different faults in motor controllers for the hydraulic spoilers, which help slow the aircraft.

Biman’s Boeing fleet issues are concentrated in complex systems, but wear-and-tear issues account for many of the service interruptions across Boeing’s global fleet.

For instance, the top driver of service interruptions for Biman’s 787s was the brake system control unit. Its breakdown rate was 14 times higher than the global fleet.

Brake-system failures do not even feature in the global fleet’s top 10.

The second-highest cause for Biman’s 787s was the spoilers, the panels on the upper surface of the wings that rise to increase drag and help the aircraft slow down.

There were two such occurrences in six months, and Boeing took corrective action in at least one case in August 2017.

The spoiler ranks ninth among the global fleet’s top 10 problems, but Biman’s rate of breakdown is about five times higher.

For the global 787 fleet, the top three causes are related to the general processing module, passenger seats and in-flight entertainment units.

For Biman’s 777s, the leading cause of service interruptions was the temperature control system, which fails six or seven times more often than it does in the global fleet, where it ranks eighth.

The second-highest cause was the cargo door, where Biman experiences about 14 times as many malfunctions as the global average.

Globally, the biggest concerns for 777s are the engine air supply and passenger seats, neither of which is a major problem for Biman.

The report notes a “lack of critical spares in stock at Dhaka base for 787 and 777”.

“Limited availability of parts leaves aircraft vulnerable and adds risk to dispatch situations,” it says.

The shortage has contributed to what Boeing described as a “high minimum equipment list (MEL) count”.

The MEL specifies which components are allowed to remain inoperative while an aircraft continues to fly, so a high count means an aircraft is operating with many inoperative components awaiting maintenance.

“MEL repair interval extensions are common and vastly over-utilised,” the report says, indicating that Biman frequently defers repairs.

It recommends an “urgent need to address MEL issues without waiting for the last minute”.

The report also identified shortages of maintenance tools at Biman’s main base and outstations, along with a shortage of skilled workers.

It recommended a proper succession plan to bridge the gap between the ageing workforce and new hires, career opportunities and incentives to retain talent, more training for mechanics working on newer aircraft models, and apprentice programmes.

Poor coordination was also contributing to delays, according to the report.

The departure ramp is 20 to 40 minutes from the hangar, and engineering staff must print manuals for last-minute technical problems because they do not have tablets with electronic manuals. There are no airside vans and only one high-lift platform in the hangar, the report said.

Biman also has no pool agreement or labour support at international bases, so “people must be dispatched from Dhaka base” to support aircraft on the ground. Visa procedures and travel time can cause further delays, it added.

That was the case in Rome on August 7 this year, when a Biman 787 operating from Toronto to Dhaka was stuck at Fiumicino Airport because of a technical problem.

Biman had to send two engineers and replacement parts from Dhaka, and nearly 260 passengers remained stranded there for more than 40 hours.

Amina Anjum Tonni, a Dhaka-based private-sector employee who was bringing her parents back from Canada on the flight, described the ordeal. “My father has had three bypass surgeries and had no opportunity to sleep during those 40 hours. They were sleeping upright throughout. He did not have his medication with him,” she said.

On August 22 this year, a Biman flight from Dhaka to Toronto via Rome was delayed by six hours, according to the airline’s operational summary.

Over the 24 hours from August 22 to 23, Biman recorded 10 flight delays, at least two of them caused by technical issues.

A Biman internal report recorded 37 delays due to technical issues over five weeks, from July 5, 2025.

The Biman report said recurring problems included wheel replacement or loss of tyre pressure (causing more than six delays), cabin-pressure control faults (causing more than five delays) and engine-related problems (causing more than four), as well as sensor faults, spoiler actuator problems, and cracked windscreens.

The report also cited several incidents.

On July 19, a Biman aircraft returned to Dhaka after developing a crack in its windscreen.

On February 28, 2025, a Dhaka-Bangkok flight was forced to return because of cabin decompression. Oxygen masks were deployed but allegedly did not work because their stated expiry date was June 2001, according to the report.

Air Commodore Mohammad Akhter Jamil, chair of avionics engineering at Aviation and Aerospace University Bangladesh, said the spare-parts shortage could be costly for the airline.

“When a plane is brought in for maintenance, and there are no spare parts, the engineer may refuse to sign it off as fit to fly. It would have to be taken out of the rotation, which would throw off the entire schedule,” he said.

The shortage could point to two possibilities, Jamil said, adding, “Either procurement is not being done on time, or parts are being consumed at a very high rate because of more frequent technical problems.”

The Daily Star contacted Biman’s managing director and CEO multiple times over two weeks but had not received a response as of filing this report yesterday.

Questions were also sent to the MD’s office through Biman’s public relations officer.

Asked whether Biman had acted on any of Boeing’s recommendations in the year since the report was prepared, a Biman official, speaking on condition of anonymity, said it had not.

Finance Minister Amir Khasru Mahmud Chowdhury has urged the state-owned Investment Corporation of Bangladesh (ICB) to become more market-oriented, competitive and professional, saying it must match the efficiency of private-sector institutions.

Speaking at an event marking ICB's golden jubilee in Dhaka today (1 October), the minister said the corporation needed to rethink its strategy after five decades of operation and transition to a fully digitalised system.

"The private sector is smart, intelligent and operates closely with both global and local markets. ICB must reach that level – you have to be market-based, competitive, efficient and professional," he said.

He also rejected the idea of seeking tax waivers for ICB while other businesses pay taxes.

The minister said the government would discuss ICB's capital restructuring proposals, without elaborating on the issue.

He also said deregulation of the capital market would continue as Bangladesh aligns its regulatory framework with global best practices. He noted that the timeline for direct listing had been reduced from 18 months to three months under the newly appointed securities regulator.
ICB seeks Tk10,000cr low-cost fund

At the event, ICB sought government support, including a Tk10,000 crore low-cost fund, to restructure its capital and ease its financial pressure.

ICB Managing Director Niranjan Chandra Debnath said the corporation had formulated a 10-year plan to overcome its crisis, with the proposed fund to be used partly to repay high-cost loans and partly for investment in the capital market.

ICB currently has around Tk14,000 crore in high-interest borrowings, he said.

The government has already provided Tk4,000 crore, part of which was used to repay debt and part invested in the stock market, generating returns for ICB, he added.

Niranjan said lower interest costs after debt repayment would help ICB return to profitability from the second year. He also outlined plans for capital restructuring, business expansion and recovery of nearly Tk1,000 crore stuck with various financial institutions.

BSEC Chairman Masud Khan said ICB's contribution to industrialisation and the capital market was undeniable but urged it to improve its professionalism to compete with private asset management companies.

He stressed better reporting, governance, portfolio rebalancing and adherence to international standards.

He further said stock market investments involve both gains and losses, making them cyclical. He stressed the need for a loss-averse approach, saying investors should rebalance their portfolios when stock prices fall to avoid missing opportunities to invest in quality stocks.

Financial Institutions Division Secretary Nazma Mobarek said ICB was currently in distress, partly because of investments made without adequate market analysis and heavy reliance on high-cost borrowing.

She said the corporation needed to assess the viability of capital restructuring and focus on rebalancing its investment portfolio.

ICB Chairman Professor Abu Ahmed said high-interest borrowing before 2024 had contributed significantly to the corporation's current crisis.

He said severe portfolio erosion, including losses linked to "pump and dump" operations, had weakened the institution and reiterated the call for Tk10,000 crore in low-cost government funding.

He added that the government assistance will ensure the survival of this institution established during the tenure of President Ziaur Rahman.

The event was organised at Hotel Purbani International to mark ICB's golden jubilee. Established in 1976, ICB has played a key role in developing Bangladesh's capital market and providing financing and other financial services.

Among others, Finance Division Secretary Dr Md Khayeruzzaman Majumder, former ICB Managing Director and former BSEC official Ziaul Haque Khondker, former ICB chairmen and managing directors, and senior officials from the Finance Ministry, Bangladesh Bank and BSEC attended the event.

Major US automakers have watched their domestic market share shrink even more thanks to their Asian competitors -- a situation that may worsen if Chinese firms are able to enter the US market, an idea floated by President Donald Trump.
“The broader market story continues to be the growing (sales), and mostly on the strength of Asian automakers,” said Charlie Chesbrough, a senior economist at Cox Automotive.

The analyst said that Asian brands are expected to account for more than half of US new vehicle sales in the third quarter, for the second quarter in a row, “approaching record-high market share levels.”

At the same time, Detroit’s historic Big Three -- General Motors, Ford and FCA/Stellantis (which makes Chrysler, Jeep and Dodge) -- will see their market share dwindle to a bit more than 36 percent, the lowest on record.

Chesbrough says the trend is rooted in the fact that Asian companies have “significant advantages” over US firms on hybrid vehicles, which more and more consumers are embracing given the volatile price of gas due to conflict in the Middle East.

GM is still the overall leader in terms of US sales, but Japan’s Toyota is quickly catching up.

GM has slipped from 17.4 percent market share in 2025 to 16.7 percent in the first nine months of this year. Toyota meanwhile went from 15.2 percent to 15.6 percent in the same period, according to Cox Automotive.

In the third quarter, GM sales fell 5.5 percent to 670,974 units, while Toyota sales rose 0.6 percent to 633,223 units.

A similar pattern emerges when comparing Ford and Hyundai-Kia, which are third and fourth, respectively. Market share and sales are down for the Dearborn, Michigan, heavyweight, and up for the South Korean group.

Cox even predicted that Ford would soon drop to fourth place, but Hyundai-Kia’s sales did not advance as much as estimated, so Ford remained in the number three spot.

FCA US sits in sixth place behind Japan’s Honda.

Michael Orange, head of US retail sales for FCA US, said Friday the companies were operating against “a highly competitive industry backdrop.”

And the situation could get worse.

In mid-September, Trump said he was “okay” with the idea of Chinese cars on American highways, as long as their manufacturers opened factories in the United States and hired American workers.

He made the comments before Chinese President Xi Jinping paid him a visit, his first trip to the White House in more than a decade.

Lobbyists representing carmakers, parts manufacturers and dealers reacted quickly, asking Trump to “keep the door firmly shut to Chinese automakers seeking to sell, import or manufacture vehicles inside the US.”

Among those who signed the letter were the American Auto Policy Council, which represents the Big Three, and Auto Drives America, which represents carmakers from Japan, Germany and other countries with US plants.

Peter Nagle, an expert at Mobility Global, estimated recently that Chinese makers such as BYD, Geely and SAIC could sell up to 1.7 million cars in the United States -- about 11 percent of the market -- from now until 2038, according to Bloomberg.

Importing Chinese vehicles is not strictly forbidden, but punitive customs duties and tariffs imposed by multiple governments would make it prohibitively expensive.

According to industry observers, these punitive measures allow the US to avoid a massive influx of low-cost Chinese vehicles, a fate seen in Europe, Australia, Southeast Asia and Latin America.

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Last month, the Alliance for Automotive Innovation -- which includes all carmakers present in the United States -- called on congressional leaders to put in place a “permanent ban” on Chinese cars, citing high-risk hardware and software they use.

Such a ban would include sale, importation and manufacturing on US soil.

Alliance president John Bozzella justified the request by invoking national security and the need to curb what he called “China’s strategy to dominate global automotive manufacturing.”

He accused Chinese carmakers of “dumping subsidized vehicles with connected software and hardware... capable of collecting, processing and transmitting sensitive vehicle and consumer data to the Chinese Communist Party.”

Prime Minister Tarique Rahman on Saturday called for deeper regional cooperation in trade, energy, technology, climate and maritime affairs to turn the Bay of Bengal into a region of shared prosperity.

"Let the Bay of Bengal become a region where nations grow together, embrace mutual and reciprocal benefits, and citizens expand meaningful cooperation," he said while inaugurating the fifth Bay of Bengal Conversation 2026 at the Pan Pacific Sonargaon Hotel in Dhaka, reports UNB.

The Prime Minister said Bangladesh's strategic location, ports, waterways and coastal economy offered significant opportunities to connect the country with the wider world through shipping, fisheries, tourism, energy and regional supply chains.

"Regionally, our shared geography should become a shared prosperity," he said, stressing the need for deeper bilateral and multilateral engagement.

Tarique said Bangladesh could expand cooperation with regional and global partners in trade, energy, education, technology, climate and maritime affairs, while opening new markets and creating more opportunities for young people.

"We can build stronger cooperation based on equality, fairness and justice. Geography has brought us together; and we are confident that people-to-people ties can take us further," he said.

The Prime Minister said Bangladesh believes in dialogue, partnership and mutual respect and would protect its national interests and sovereignty while working positively with all regional and global partners.

"Because peace and harmony are the foundation of shared prosperity and development," he said.

The three-day Bay of Bengal Conversation 2026 is being organised by the Centre for Governance Studies (CGS) from October 3 to 5 under the theme "Fragments, Frontiers and Futures: Navigating Power, Technology and Trust in a World Rewritten".

The conference brings together around 200 speakers, more than 300 delegates and over 1,000 participants from more than 100 countries.

Participants include former heads of state, ministers, diplomats, policymakers, researchers, academics, journalists, business and investment leaders, technology experts and civil society representatives.

Former Serbian President Boris Tadic and former Malian Prime Minister Moussa Mara are among the notable participants.

In his address, Tarique also outlined his government's five-year priorities, saying Bangladesh is moving "from commitment to implementation" with a focus on national interests, policy continuity, economic stability and institutional reform.

He said the government is working to make Bangladesh an attractive destination for investment and a strong manufacturing and investment hub, with a focus on creating jobs in production, services and exports.

Tarique also highlighted the government's social protection initiatives, including the Family Card, Farmer's Card, Health Card and an eventual Universal Card to provide integrated access to public services.

On healthcare, the Prime Minister said the government is working to employ 100,000 healthcare workers, around 80 percent of whom would be women, to provide basic care, health advice and referrals at the community level.

He said his government is also focusing on maternal and child healthcare and expanding access to education, including free uniforms, school bags, midday meals and scholarships from Class One.

The Prime Minister said Bangladesh's young population is a major national asset but turning the demographic dividend into development required skills and jobs.

"We are embracing technological changes and artificial intelligence, while promoting language skills and employment pathways," he said, adding that the government is supporting innovation, entrepreneurship and start-ups.

"We want our youth to compete globally and turn 'brain drain' into 'brain circulation'," the Prime Minister added.

On agriculture and climate resilience, Tarique said his government is improving farmers' access to technology, irrigation, finance and markets while supporting fisheries, livestock and rural enterprises.

He said Bangladesh planned to dig 20,000 kilometres of canals and waterways over the next five years, advance the Padma Barrage project and develop a Teesta Master Plan.

Tarique also announced a target to plant 250 million trees over five years and said Bangladesh was expanding solar energy, waste recycling and green factories.

On governance, the Prime Minister said development required strong institutions, with transparency and accountability, human rights, democratic principles and freedom of expression protected. "The rule of law must apply equally to every citizen," he said.

On the Rohingya crisis, Tarique said Bangladesh continued to host around 1.2 million refugees and remained committed to their early, voluntary, safe, dignified and sustainable repatriation to Myanmar.

"This requires sustained political support and global finance. It also requires addressing the root causes of the crisis, which started in Myanmar and must end in Myanmar," he said.

The Prime Minister reiterated Bangladesh's readiness to play its part in promoting cooperation in the Bay of Bengal and beyond.

The Prime Minister formally opened the three-day event around 10am.

CGS President Zillur Rahman and Executive Director Parvez Karim Abbasi delivered the welcome remarks at the opening of the conference.

The programme includes public sessions such as plenaries, leadership forums and spotlight talks, as well as smaller invitation-only roundtables for in-depth discussions, according to the organisers.

The discussions will focus on major regional and global issues, including geopolitics and security, technology, trade and connectivity, climate change, human security, democracy, governance, trust, spirituality and humanity.

Crude futures finished down after European leaders agreed to US President Donald Trump’s request to release diesel reserves to lower prices and reduce fuel imports from the US.
Brent settled down 6 cents, or 0.06 percent, at $102.25 a barrel. WTI finished down $1.76, or 1.90 percent, at $91.11 a barrel.

For the week, Brent was up 0.11 percent with WTI 1.6 percent lower.European Union countries agreed to a French proposal to release additional diesel stockpiles, a source familiar with details of the discussion told Reuters.

“Europe has just agreed to release a massive amount of their heavily stocked Diesel Oil,” Trump wrote in a post on Truth Social. Previously, Trump had said he was mulling a ban on US diesel exports.

“Europe is feeling pretty vulnerable,” said Phil Flynn, senior analyst with the Price Futures Group. “Europe would be one of the areas to suffer the most if we put an export ban on diesel.”

EU governments acted after discussing the proposal by France for European countries to release 50 million barrels of diesel, and for International Energy Agency members to release 50 million barrels of crude oil, three sources familiar with the discussions told Reuters.

Under the proposal, Europe would release part of the diesel volumes in a 20-day period, two of the sources said. French President Emmanuel Macron chaired a videoconference with G7 leaders on Friday, the Elysee Palace said.

It was not immediately clear if G7 countries had agreed to France’s proposal on the volumes of fuel to be released.

“This highlights that the main stress in the energy market is no longer crude availability, with Middle East flows recovering, but rather refined product supply, constrained by reduced refinery capacity and output across the Middle East and Russia,” said Ole Hansen, head of commodity strategy at Saxo Bank.

John Kilduff, partner with Again Capital, listed other issues shaping the oil market.

“The rhetoric back and forth between the US and the Iranians,” Kilduff said.

“The midterm elections. What kind of cliff does that represent for the president?”

“What’s really making the Iranians talk again is the squeeze on their economy,” Kilduff added.

On Thursday, prices settled higher after Reuters reported that Chinese refiners had suspended oil product exports for October to preserve domestic stocks.

Also supporting prices, the Wall Street Journal reported that the US was sending a third aircraft carrier and up to 10,000 more troops to the Middle East as Trump weighed resuming strikes on Iran after the midterm elections.

Hamad Hussain, senior climate and commodities economist at Capital Economics, said another release of oil stocks “could be enough to help tip the overall market back into a slight surplus if the recent pick-up in flows from the Middle East is sustained”.

Barclays said in a note that despite better crude flows out of the Middle East, physical market fundamentals remained strong, with inventories still being drawn, and prompt cargoes commanding steep premiums over forward prices.

It raised its fourth-quarter Brent forecast by $20 a barrel to $115 and lifted its 2026 forecast to $100 a barrel.

Elsewhere, Ukraine has struck oil facilities in Russia’s Samara and Volgograd regions over the past 24 hours, President Volodymyr Zelenskiy said on social media on Friday.

Invest Bangladesh, the country’s apex investment promotion agency, has introduced an incentive scheme to encourage Bangladeshis at home and abroad to attract fresh foreign direct investment (FDI), seeking a cost-effective way to promote the country to overseas investors.

The scheme will offer a cash incentive of 1.25 percent to individuals who mobilise at least $1 million in fresh foreign investment, according to an official of the agency.

It targets around $600 million in fresh equity investment, based on the previous year’s benchmark, against Bangladesh’s average annual FDI inflow of about $1.5 billion, a significant portion of which comes from reinvestment.

The initiative comes amid sluggish FDI growth in Bangladesh, particularly compared with regional peers.

The Cabinet approved the Foreign Direct Investment (FDI) Incentive Scheme Policy, 2026, on June 4 to encourage expatriate Bangladeshis and other citizens to leverage their networks to attract foreign investment.

However, the Cabinet Division did not disclose the specific benefits or incentives under the policy at the time.

The policy addresses a key challenge for Bangladesh: the country remains relatively unknown to many potential investors, while promoting it overseas requires substantial spending.

Speaking to The Daily Star, Nahian Rahman Rochi, an executive member of Invest Bangladesh, said many investors, particularly in emerging markets, remain unaware of Bangladesh’s market size and investment opportunities.

“We do not have the budgetary support to promote Bangladesh on a mass scale,” he said.

The incentive scheme aims to address this limitation by tapping Bangladeshis and non-resident Bangladeshis (NRBs) who have established business and professional networks abroad.

“Many NRBs are in very good positions abroad. They have the right connections,” Rochi said.

The government wants to leverage these networks to reach potential investors, particularly in emerging markets where Bangladesh has limited visibility and companies are exploring new investment destinations.

Rochi cited Turkey, where high inflation and interest rates have prompted some businesses to consider relocating. Turkish textile and advanced textile companies, for instance, are exploring investment opportunities in countries such as Egypt and Ethiopia.

Bangladesh, with its established textile industry, could potentially attract some of these investors, but reaching the right decision-makers remains a challenge, he said.

The incentive scheme seeks to reward individuals who can turn their overseas connections into actual investments in Bangladesh.

The scheme will focus on fresh foreign equity investment rather than existing investments or reinvestment. Prospective investors must be registered under the scheme before making the investment, and incentives will be paid only after the funds have been brought into Bangladesh and verified.

Authorities will assess whether investors have taken concrete steps, such as opening bank accounts, acquiring land or starting construction, to ensure that investments are genuine.

The incentive will be paid in two instalments, with 52 percent disbursed after the investment is verified and the remaining 48 percent after the project is fully completed, Rochi said.

For instance, an individual who mobilises Tk 100 crore in investment will be entitled to a cash incentive of Tk 1.25 crore. After deductions for taxes and VAT, the individual will receive Tk 1 crore, he added.

Rochi said the scheme’s objective is not merely to increase the headline FDI figure but to attract fresh foreign equity that might otherwise not reach Bangladesh.

The initiative will enable the country to tap into the networks of Bangladeshis based in key overseas markets, reducing the need to establish and maintain an extensive investment-promotion infrastructure abroad, he added.

The government has unveiled a comprehensive short-, medium-, and long-term energy roadmap aimed at bolstering national energy security, meeting rapidly growing electricity demand, and mitigating fuel supply vulnerabilities through domestic resource extraction and modern technology.

The policy document, titled "Challenges and future roadmap for Bangladesh's power and energy sector", was presented by the Ministry of Power, Energy and Mineral Resources to Prime Minister Tarique Rahman on 14 September.

The plan

Under the medium-term strategy spanning 2028-30, the government plans to add 12,940MW of generation capacity to the national grid to accommodate projected peak demand of 20,000–25,000MW. This includes 10,000MW from new solar installations, 2,940MW from coal-fired projects across Barapukuria (300MW), Payra (1,320MW), and Matarbari (1,320MW), alongside modernisation of grid distribution networks and the deployment of battery energy storage systems (BESS).

Solar on PPP model

Large-scale solar development will rely heavily on public-private partnership (PPP) models in Sirajganj, Sonagazi, and Rampal. Additionally, private entrepreneurs are being engaged under the OPEX model; as of 28 September, 1,400 applicants had collected submission forms. The initiative is backed by initial approval for a $350 million loan from the World Bank, alongside ongoing financing discussions with the Asian Infrastructure Investment Bank (AIIB) and the Asian Development Bank (ADB).

For the immediate 2026–27 period, short-term measures are already being implemented to cover an estimated demand of 20,000MW. Supply allocations comprise 6,000MW each from gas and coal, 4,000MW from liquid fuels, 2,500MW via regional imports, and up to 4,000MW from rooftop solar. To expedite solar adoption, import duties on solar equipment have been slashed from 64% to 1%, advance income tax reduced from 15% to 1%, and the purchase tariff set at Tk 10.50 per unit.

Long-term Objective

Looking ahead to 2031–40, the long-term objective sets a target of securing at least 30% of total generation from renewable sources by 2040, gradual retirement of costly oil-fired generation, integration of small modular reactor (SMR) nuclear technology, and cross-border power purchases to serve demand estimated at 38,000–40,000MW.

Gas supply expansion forms a parallel pillar of the strategy. The roadmap includes plans for a 1,000mmcfd land-based LNG terminal, advanced negotiations for a 600mmcfd FSRU in Kutubdia with a Chinese state enterprise, and the completion of surveys for the 96km Feni–Bakhrabad pipeline. Onshore, 31 of a targeted 150 exploration wells in the first phase have been drilled, with a secondary 150-well campaign planned for 2031–35. Bidding under the "Bangladesh Offshore Model PSC-2026" has also opened to international energy firms.

Despite these targets, energy analysts have raised concerns regarding fiscal sustainability and implementation.

What experts say

Khondaker Golam Moazzem, president of Knowledge Hub Institute Trust, cautioned that the roadmap lacks a rigorous integrated financial analysis and clear sources of funding.

"The financial pressure created by the previous government's flawed policies, irregularities, and corruption could multiply unless the current strategy is properly revised," Moazzem said, noting that heavy reliance on imported LNG exposes the economy to global market volatility. He added that domestic coal development carries high environmental risks and costs, while pointing out that the plan overlooks other alternative renewables such as wind, waste-to-energy, and small hydro.

Shafiqul Alam, lead energy analyst for Bangladesh at the Institute for Energy Economics and Financial Analysis (IEEFA), stressed that operational continuity remains paramount.

"Renewables will play a crucial role in the coming years and the government is rightly prioritising the sector," Alam said, highlighting that global financing for coal projects is rapidly contracting. He emphasised that accelerated domestic gas exploration must proceed without disruption to reduce expensive liquid fuel and LNG import dependencies.

Power demand rises 17%

The roadmap said electricity demand is rising rapidly even as the country struggles with fuel shortages to maintain generation. Total electricity demand stood at 15,570MW in September 2025 but rose 17% year on year to an estimated 18,178MW on 14 September.

In September 2025, total electricity generation stood at 15,271MW. Gas-fired plants accounted for the largest share at 5,875MW, followed by coal-fired plants at 4,719MW and liquid-fuel plants, including furnace oil and diesel, at 2,812MW.

For September 2026, total generation is projected at 15,859MW. Gas-fired generation is expected to rise slightly to 5,977MW, while coal-fired generation could fall to 4,363MW.

To address coal shortages and meet higher demand, generation from liquid-fuel plants is planned to increase significantly to 3,791MW.

Bangladesh's private-sector external debt fell by more than 23% from its 2022 peak to nearly $19.94 billion in July 2026, as high global interest rates, taka depreciation and foreign-exchange pressures prompted businesses to pay down short-term dollar liabilities and reduce reliance on foreign borrowing.

The shift is most visible in short-term debt, which includes buyer's credit, deferred import payments and other trade facilities. It fell 42.48% to $10.21 billion between the second quarter of 2022 and July 2026, Bangladesh Bank data show.

The sharp decline indicates that local businesses have been repaying foreign obligations rather than rolling them over, while also relying less on short-term foreign credit to finance imports and working capital.

At the same time, long-term private-sector external debt has risen steadily, increasing from $4.92 billion in early 2020 to nearly double that amount, or $9.73 billion, by July 2026.

Businesses say they have increasingly shifted away from volatile, short-tenor foreign loans towards structured long-term facilities to reduce exposure to sudden refinancing and rollover pressures.

"Foreign loans have become too expensive – 7-8%," said Mostafa Kamal, chairman and managing director of Meghna Group of Industries (MGI), which has borrowed from various foreign sources.

MGI has taken both short-term foreign loans, including working-capital facilities, and long-term project loans with maturities of five to 10 years.

"We still have foreign loans in the process, but now it has become far more expensive than it was in 2020-2021," Kamal told The Business Standard.

Interest on private-sector foreign loans is tied to the benchmark SOFR (Secured Overnight Financing Rate), which is 3.87% as of 1 October 2026, according to the Federal Reserve Bank of New York. SOFR was near zero at 0.05% in 2021 and it jumped to 1.50% in Q2 of 2022 when the global economy, including Bangladesh, recovered from Covid-19. On top of that, foreign lenders add a credit risk spread and a 20% withholding tax on interest remittances sent abroad.

Bangladesh Bank data show that private-sector external debt peaked at $25.95 billion in the second quarter of 2022, up from $13.23 billion two years earlier.

At the peak, more than $17.75 billion, or about 68% of total private-sector external debt, consisted of short-term liabilities. Four years later, in July 2026, total private-sector external debt had fallen to $19.94 billion, while the share of short-term debt had dropped to around 50%.

Fahmida Khatun, distinguished fellow at the Centre for Policy Dialogue (CPD), said the decline in private-sector external debt was likely the result of several pressures working together.

High global interest rates have made foreign borrowing more expensive, while the depreciation of the taka has increased the amount businesses have to repay in local currency against dollar-denominated loans.

"Though foreign exchange reserves are increasing, they are not enough. With foreign exchange scarce and access to dollars uncertain, private companies probably avoided new foreign debt and repaid existing obligations where possible," said Fahmida.

The sharpest decline has been in short-term debt, which fell 42.48%.

"This may partly reflect reduced use of trade credit and short-term loans to finance imports," the economist said.

"When import payments are difficult or costly, businesses may cut or delay imports, seek more domestic financing, or reduce their reliance on short-term foreign credit," she told TBS.

Bangladesh Bank's reporting classifies private-sector short-term external debt as including trade credit and other short-term liabilities. The decline, therefore, may reflect changes in these financing flows as well as actual loan repayments.

"This reduction can lower exposure to foreign currency and refinancing risks. But it should not automatically be seen as a sign of stronger businesses. It may also indicate that the private sector is postponing investment, facing tighter access to finance, or operating with lower imports and production," said Fahmida.

The decline in total external debt could mean repayments have exceeded new borrowing. However, determining the precise causes would require data on new borrowing, repayments, trade credit and investment, she said.

The Insurance Development and Regulatory Authority (IDRA) is stepping up efforts to clear the massive backlog of unpaid claims, with another Tk 264 million set to be paid to 7,641 policyholders on Sunday.

This will be the third phase of IDRA's special claim-settlement initiative.

The payout will bring the total amount disbursed to Tk 639.1 million, paid to 16,058 policyholders in three phases, as the regulator seeks to address long-pending legitimate claims and rebuild confidence in the insurance industry.

The total outstanding unpaid claims in the insurance sector, however, would still remain high – at Tk 70 billion – mostly involving some life insurers, according to the IDRA.

Against this backdrop, the regulator has prioritised the settlement of legitimate claims that have remained unpaid for extended periods, particularly those involving financially distressed insurers.

The third-phase payment is being led by IDRA Chairman Mir Nadia Nivin as part of a broader drive to revive the sector.

Under the latest phase, Baira Life Insurance will pay Tk 0.58 million, Homeland Life Insurance Tk 48.8 million, Padma Islami Life Insurance Tk 90 million, Progressive Life Insurance Tk 67.8 million, Sunflower Life Insurance Tk 3 million and Sunlife Insurance Tk 53.5 million.

The regulator has been arranging funds from various sources, including by selling assets and security bonds of the insurers concerned, to meet the claims.

Ms Nivin, who took office in July, said the settlement of long-pending legitimate claims is one of her top priorities. "The initiative is aimed at protecting policyholders' rights, restoring discipline in the insurance sector and rebuilding public trust," she said recently.

The claim-settlement drive will continue, with remaining legitimate claims to be considered after verification and scrutiny.

IDRA has also been conducting one-to-one governance review meetings with insurance companies to identify the reasons behind delays in settling claims and the operational or compliance-related problems responsible for the backlog.

"Some companies have ancillary and compliance-related problems," Ms Nivin said, adding that the regulator is working with the parties concerned to resolve the issues quickly.

Of the country's 82 life and non-life insurance companies, only a handful are facing serious difficulties, according to the IDRA chairman.

Around seven to eight troubled life insurers are being dealt with separately, but the regulator's intervention is not limited to those companies.

"We have taken a holistic approach to improving claim settlement across the entire insurance sector," she said.

Companies facing moderate-level problems are also being brought under closer supervision. Their financial capacity is being reviewed, while the regulator is putting pressure on them to accelerate the settlement of legitimate claims, she added.

Settlement drive so far

In the first phase, IDRA facilitated the payment of Tk 145.1 million to 2,549 policyholders of seven life insurers on September 3.

The first phase covered Baira Life Insurance, Fareast Islami Life Insurance, Golden Life Insurance, Homeland Life Insurance, Padma Islami Life Insurance, Progressive Life Insurance and Sunflower Life Insurance.

Under the second phase, IDRA paid Tk 230 million to 5,868 policyholders of five life insurers on September 14. The companies were Padma Islami Life Insurance, Homeland Life Insurance, Fareast Islami Life Insurance, Sunflower Life Insurance and Sunlife Insurance.

The initiative comes at a time when the insurance industry is grappling with a serious confidence crisis stemming from delayed claim payments, financial weaknesses at some insurers and regulatory concerns.

The regulator is simultaneously pursuing broader reforms, including stronger supervision of insurers and measures aimed at improving financial discipline, as part of its efforts to strengthen the sector.

Once a reputed and profitable state-owned lender, BASIC Bank is still struggling to recover from the financial damage caused during the tenure of its former chairman Sheikh Abdul Hye Bacchu, under whom irregularities involving around Tk 4,500 crore came to light.
Established in 1989, the bank was profitable till 2009, when the then Awami League government appointed Jatiya Party leader Bacchu as its chairman.
Soon after, the commercial lender became mired in financial irregularities.

An inspection by the Bangladesh Bank (BB) later found that loans worth Tk 4,424.93 crore were disbursed with serious irregularities across four branches between December 2009 and November 2012. The loans are yet to be recovered by the bank.
Bacchu resigned as BASIC Bank chairman in July 2014, shortly after BB uncovered massive irregularities and scams and recommended that the finance ministry dissolve the bank’s board.

By then, the state lender’s bad loans had jumped to 57.15 percent from just 4.83 percent at the end of 2010.Although widespread irregularities and corruption took place at the bank, Bacchu was not officially held responsible until 2015.
By the time the Anti-Corruption Commission (ACC) identified him as responsible, he had already fled the country.

FAILED MERGER WORSENED BASIC CRISIS

Amid the irregularities and scams, BASIC Bank posted a net loss of Tk 53 crore in 2013. Since then, it has reported losses every year.

The loss stood at Tk 416 crore in 2023 and had reached Tk 655 crore by September 12 this year, according to the bank’s data.

Over the same period, its bad loans rose to Tk 8,153 crore, or 64.49 percent of its total disbursed loans, while its provision shortfall stood at Tk 5,051 crore as of September 12 this year. The bank also faces a capital shortfall of Tk 5,148 crore, show data.

Under the previous Awami League government, then BB governor Abdur Rouf Talukder pushed BASIC Bank towards a voluntary merger with City Bank, one of the country’s largest private lenders, in April 2024.

The move was part of a broader central bank drive to merge weak banks with stronger ones.

However, the rescue initiative dealt another blow to the bank. It triggered a severe liquidity crisis as public and institutional depositors panicked. The plan was eventually scrapped following the political changeover in August 2024.

The image problem still hurts deposits and business despite improvements over the past two years, according to Helal Ahmed Chowdhury, chairman of the bank, who took charge in November 2024.

Helal, a senior banker with nearly five decades of experience, said that the bank’s main wound is the scam that started in 2009. “We are still struggling to overcome its impact.”

He said the bank is now focused on reducing non-performing loans (NPLs), expanding export and import business, onboarding new exporters, strengthening its foreign currency position and attracting remittances through arrangements with overseas banks.

TK 5,000CR DEPOSIT SOUGHT FOR RECOVERY

The current chairman of the bank said they are seeking Tk 5,000 crore in low-cost deposits from the government or BB to improve its financial position and reduce NPLs.

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“The proposal is still under process.”

Helal said the low-cost funds could be used to replace some high-cost deposits, helping strengthen the bank’s liquidity position and rebuild depositor confidence.

The bank is also seeking government support to open Special Notice Deposit (SND) accounts with government agencies and to be included among the banks designated to receive government deposits and loans.

An SND account is a short-term, interest-bearing bank account for businesses, institutions and individuals who need frequent transactions but want to earn a higher return than a standard current account.

As of September this year, the bank’s deposits stood at Tk 17,224 crore, while its loans and advances stood at Tk 12,521 crore, according to data.

Helal said the bank is working with Sonali Bank and other lenders on bilateral arrangements and is seeking agency agreements with overseas banks to facilitate remittance inflows.

To boost lending and recovery, BASIC Bank has introduced a system requiring every branch to submit two loan proposals and two recovery plans each month.

The bank has 72 branches and 35 sub-branches, along with other operational units.

Up to September this year, the bank recovered Tk 79 crore in cash and Tk 229 crore through non-cash recovery from classified loans, according to data.

‘SIGNS OF IMPROVEMENT IN SIGHT’

The chairman said the bank has already begun to show signs of improvement, although its large legacy losses mean positive results have yet to fully offset accumulated losses.

Policy support from BB, including relevant regulatory measures and schemes, would be crucial to the bank’s turnaround, he said.

“We believe there is every possibility of turning the bank around within the next three years, provided we receive the necessary support,” he said, adding that the bank has drawn up a three-year action plan involving low-cost funds from BB, policy support, reduced cost of funds and capital injection.

TOP 20 DEFAULTERS OWE TK 2,288CR

As of June this year, BASIC Bank’s top 20 defaulters collectively owed Tk 2,288.25 crore in classified bad loans, all rated “Bad/Loss”, the worst category under the Bangladesh Bank’s loan classification norms.

Real estate firm Amader Bari Ltd topped the list with Tk 204.66 crore in outstanding dues, followed by Crystal Steels & Ship Breaking Ltd, Western Housing Ltd, Well Tex Ltd and Zeal Wears Ltd.

Other large defaulters include Cox’s Developer Ltd, Map Paper Board Mills Ltd, IG Navigation Ltd, Bay Navigation Ltd, and Regent Weaving Ltd -- each owing more than Tk 110 crore.

The remaining names on the list are Confidence Shoes Ltd, The Aristocrat Agro Ltd, Ali Trade International Ltd, Ajbina Agro Industries Ltd, Atlas Food & Beverage Ltd, Barshon Agro Industries Ltd, Techno Design & Development Ltd, Mynco Jute Mills (Composite) Ltd, New Auto Define, and Lohozong Trade International Ltd.

Bank data show recovery against these accounts has been minimal, with cumulative collections of only about Tk 36.4 crore so far -- barely 2 percent of the total outstanding -- while the forced sale value of pledged collateral covers just Tk 364.71 crore, or roughly 16 percent, of the amount owed.

The chairman said the bank is pursuing legal action against the defaulters through the money loan court, under the Negotiable Instruments (NI) Act, and through cases filed by the Anti-Corruption Commission.

Recovery efforts against loans disbursed during the period of major irregularities are also continuing, he said, suggesting that the actual recovery position be assessed from a specific cut-off date.

The bank’s recovery efforts could be significantly strengthened if it regained control of its building, currently under dispute with a developer, he said. The bank also needs additional manpower and technological upgrades, including an updated core banking system (CBS).

‘GOVERNANCE KEY TO ANY RECOVERY’

Toufic Ahmad Choudhury, former director general of the Bangladesh Institute of Bank Management (BIBM), said there is no example in Bangladesh of a weak bank becoming strong through government liquidity support or capital injection.

He described some state-owned banks, including BASIC Bank, as “bottomless baskets” that cannot recover on liquidity support alone.

Strong governance and a focus on reducing non-performing loans are essential, he told The Daily Star.

“Liquidity support should not be provided without ensuring good governance,” he said.

“The government itself is responsible for the distress of state-owned banks. Fixing them requires political commitment, but the government lacks the willingness to reform them. If it had the political will, these banks would have recovered by now,” Toufic added.

Commerce Minister Khandakar Abdul Muktadir yesterday asked importers to open letters of credit (LCs) quickly to increase supplies of fruits, including dates, and keep prices in check.

At a meeting with traders and representatives of relevant government agencies at the Secretariat, Muktadir asked traders how the retail price of malta (orange)had reached Tk 520 per kg after accounting for import costs, duties, taxes and other expenses.

Traders attributed the price rise primarily to a severe supply shortage, as only 12 to 29 containers of malta arrived in some weeks against an estimated daily requirement of around 15 containers, according to a press release.

Importers added that high duties, transport costs, shipping and port complications, and losses on earlier consignments had led many to cut malta imports.

In response, Muktadir assured traders that the government would review the duty on malta and urged them to source more from alternative markets and open LCs quickly to increase supplies within the next few weeks.

He also directed the Directorate of National Consumer Rights Protection to take action if evidence of malta being sold at abnormal prices is found, saying unjustified price hikes would not be allowed.

On dates, a widely consumed item during Ramadan, Muktadir said the government would announce its decision on duties and taxes on the fruit this week.

Date importers said longer shipping times caused by international transport and port-related complications made a quick decision on duties necessary to ensure adequate supplies arrived on time.

Also speaking at the event, a National Board of Revenue representative said the actual purchase prices of dates of different qualities and grades vary, but the differences are not always properly reflected in customs valuations.

The Bangladesh Trade and Tariff Commission is expected to meet importers in the coming days to work towards a reasonable indicative price for dates after verifying international source prices for different grades, before sending a proposal to the revenue board.

For the first time, the Bangladesh Bank has introduced a quarterly Monetary Policy Statement (MPS). This is a positive step as the move to review the monetary policy stance every three months instead of every six months comes at a time when inflation, investment, credit flows, and global conditions are changing rapidly.

In its first quarterly statement, the central bank has kept the policy interest rate unchanged at 9.5% for the October–December 2026 period. The aim of this change is to make monetary policy more timely and responsive by taking new information and emerging risks into account.The first quarterly statement says the main objective of the initiative is to regularly review domestic and global economic conditions and, when necessary, adjust the monetary policy stance in a timely manner.
The decision is important in the sense that, according to the Bangladesh Bureau of Statistics (BBS), inflation declined somewhat, standing at 8.32% in July and 8.26% in August, but supply-side and cost-related risks remain.High fuel and fertiliser prices, the conflict in the Middle East, and the potential impact of a new wage structure could push inflation up again. At the same time, weak industrial production, slower private-sector credit growth, and a slowdown in investment are putting pressure on economic activity.
Bangladesh Bank expects that regular reviews will help strike a balance between maintaining price stability and supporting economic activity. The Monetary Policy Committee plans to closely monitor domestic and global economic and financial developments and adjust its policy stance when necessary.

The statement also mentions incentive and refinancing programmes to support growth and help contain inflation. However, it does not specify how much the quarterly reviews are expected to reduce or increase inflation or credit growth.

In reality, the outcome will depend on the availability of reliable data, timely policy decisions and complementary measures, including reforms in the banking sector.

The central bank expects private-sector credit growth to pick up in the October–December quarter as liquidity conditions improve. However, it acknowledged that interest rates alone will not be enough to revive economic growth.

To ensure that credit reaches productive sectors, it is essential to address weaknesses in the banking sector, reduce credit risks and tackle constraints related to power, energy and infrastructure.
Against this backdrop, recent trends in Bangladesh's economy show that while inflation has eased somewhat, it is still far from a comfortable level. Weaknesses also persist in lending and investment.Alongside monetary policy, banking-sector reforms and coordinated government action on supply-side and fiscal policies will be essential to contain inflation, restore investor confidence and boost the flow of credit.One advantage of reviewing monetary policy every three months is that the central bank will not have to wait too long to respond to changes in the economy. But changes in the policy interest rate take time to feed through to lending and investment. Despite a modest cut in the policy rate, private-sector credit growth stood at just 4.75% in August, significantly lower than in previous years.

The quarterly monetary policy statement would be more useful for businesses and investors if it clearly explained the data underpinning each policy decision and the risks that could prompt a change in the policy stance. Greater clarity on these issues would help private-sector decision-makers plan with more confidence.Improving the quality of economic forecasts is also important. Alongside publishing a specific inflation forecast, Bangladesh Bank could explain how changes in fuel prices, the exchange rate, food supply or government spending could affect the outlook.If there is a gap between an earlier forecast and the actual outcome, the reasons should be explained in the following statement. This would help markets and businesses distinguish between changes driven by new information and those that signal a shift in the monetary policy stance.Removing the barriers to credit flow is equally important. High levels of non-performing loans and weak governance in banks, borrower risks and a lack of investor confidence could prevent credit from reaching productive businesses even if the policy rate is lowered.

Bangladesh Bank itself has highlighted the need to restructure banks, restore their capital, strengthen governance and improve credit discipline.

Finally, monetary policy needs to be coordinated with the government's fiscal and supply-side policies. Raising interest rates can help curb overall demand, but it cannot directly stop price increases caused by shortages of food or fuel.

Other measures are equally important, including removing bottlenecks in food imports and distribution, closely monitoring supply conditions, ensuring adequate fuel supplies and providing targeted support to low-income households.Fiscal and monetary policies also need to work in tandem to ensure that government borrowing and the budget deficit do not undermine the objectives of monetary policy.The quarterly monetary policy statement has shortened the policy review cycle, giving the central bank more scope to respond quickly to changes in the economy. Its effectiveness, however, will depend on the timeliness of data, the credibility of forecasts and the transparency of policy decisions.With regular reviews, the approach should ideally make it easier to see how new information shapes policy decisions and the reasoning behind them. Alongside monetary policy, banking-sector reforms and coordinated government action on supply-side and fiscal policies will be essential to contain inflation, restore investor confidence and boost the flow of credit. The author is a Distinguished Fellow at the Centre for Policy Dialogue (CPD).