Dhaka, Bangladesh (BBN) – The country’s overall trade deficit widened by nearly 46 per cent in the just concluded fiscal year (FY), 2014-15, due to higher import payments and lower export receipts, officials said.
The trade deficit rose to $9.92 billion during the July-June period of the FY 2014-15 from $6.79 billion in the same period of the previous fiscal, according to the central bank’s latest statistics.
The trade deficit is widening gradually due mainly to lower export earnings while imports are growing at a healthy pace, they explained.
The imports grew 11.25 per cent to $40.68 billion in the FY 15 against $36.57 billion in the corresponding period of the previous fiscal.
On the other hand, the country’s export earnings grew only 3.33 per cent to $30.77 billion in the last fiscal against $29.78 billion in the FY 15, the official data showed.
Talking to BBN, a senior official of the Bangladesh Bank (BB), the country’s central bank, said its very natural for a growing economy like Bangladesh.
“Trade deficit is not necessarily bad for an emerging country like Bangladesh because the major share of imports represents capital machinery and industrial inputs which provide potential of growth for the future,” the central banker explained.
Besides the gap in the trade in goods, deficit also increased in trade in services in the FY 15.
Gap in services trade stood at $4.63 billion in the FY 15, which was $4.10 billion a year ago.
Trade in services includes tourism, financial service and insurance.
The country earned $3.02 billion in services trade in the last fiscal while payments on services surged to $7.64 billion in the FY 15, from $7.21 billion in the previous fiscal.
Such higher trade deficit pushed down the current-account balance significantly, despite uptrend in inward remittances, another BB official said.
Bangladesh received $15.17 billion in the FY15, registering a 7.47 per cent growth over the corresponding period of the previous fiscal.
The country’s current-account balance entered the negative territory last September due to higher landed imports, recorded by the customs department, according to the central banker.
However, the current-account deficit came down to $1.65 billion in the FY 15 from $2.10 billion a month ago. It was $1.40 billion surplus in the FY 14, the BB data showed.
The overall balance of payments (BoP) came down to $4.37 billion in the last fiscal from $5.48 billion in the previous fiscal.