Dhaka, Bangladesh (BBN) – The Bangladesh Business News (BBN) prepares the morning business round up compiling reports, published by different newspapers and news portals in Bangladesh.
Subsidy volume to shrink next fiscal: The government’s allocation on account of subsidy to the power and energy sector is set to decline by 30.11 per cent to Tk 94 billion in the next fiscal year (FY) 2014-15 over that of the previous year, a senior energy ministry official said Saturday. Stable fuel price in the international market coupled with import of furnace oil by the private sector for generating electricity would help reduce substantially the subsidy requirement in the energy sub-sector by 69.81 per cent to Tk 24 billion, he said. Despite the hike in retail level electricity tariff by average 6.96 per cent from March 1 last, the government’s subsidy to the power sector is set to increase by 16.66 per cent to Tk 70 billion in FY 2014-15.
Time to go for wealth tax: A government employee had bought a 2.5-katha plot at Tk 80,000 in Mirpur in 1989. Now the land values at around Tk 1 crore, or 125 times higher, in a span of 25 years. Another man who is a banker had bought a 1,500-square-feet flat at Eskaton in the capital at Tk 25 lakh in 2000, the market price of which is around Tk 1 crore now. In another case, a land investor had purchased several hundred decimals of lands beside the Dhaka-Maoa highway in 2000-2001. He had to spend Tk 5,000-Tk 10,000 per decimal depending on the locations. Now he has been selling out the lands at Tk 5 lakh to Tk 10 lakh per decimal. The hike in the prices is astronomical — 100 times higher than 14 years ago. The returns are amazing compared to any other format of investments in any country. And the gain is tax-free as well, which is why people choose to invest heavily in properties in Bangladesh.
Dhaka to seek fresh ODA for mega projects: Bangladesh will seek new overseas development assistance from Japan to finance several mega projects, including Ganges Barrage, Jamuna Multi-modal Tunnel and a second nuclear power plant, during prime minister Sheikh Hasina’s four-day official visit to Tokyo beginning today. Other projects include a parallel railway bridge over Jamuna river, Eastern Bypass, excavation of four rivers around Dhaka city and Mawa-Kalna-Jessore road. Foreign minister AH Mahmood Ali while briefing reporters on Saturday on the prime minister’s Tokyo visit could not mention the amount of the new ODA assistance Bangladesh would be seeking. He said Dhaka and Tokyo continued discussion on financing these projects. ‘Nothing has yet been finalised about the funding…It would depend on our negotiations,’ he told a correspondent. Japan has already made a pledge of $1.18 billion under the 35th ODA to Bangladesh to finance five projects in energy and infrastructure development during Japanese foreign minister Fumio Kishida’s visit to Dhaka last March.
Bangladesh’s stocks slip for fourth week: Bangladesh’s stocks plummeted for the fourth straight weeks that ended Thursday as investors remained reluctant in making investment amid shaky confidence. Week-on-week, the prime index of Dhaka Stock Exchange—DSEX–came down below the psychological support level of 4,400 points and ended at 4,384.06 points, shedding 32.89 points or 0.74 percent. The other two indices also closed in red. The DS30, comprising blue chips lost 14.79 points or 0.92 percent to close at 1589.60 points. The DSE Shariah Index went down by 11.92 points or 1.21 percent to close at 972.92 points. The port city bourse–the Chittagong Stock Exchange (CSE)–also ended lower for the last fourth week with its Selective Categories Index–CSCX–lost 73.6 points or 0.86 percent to close the week at 8,435.24 points.
Private investment falls for second year: Private investment dropped for the second year on the back of political uncertainty. In fiscal 2013-14, private investment as a proportion of gross domestic product stood at 21.39 percent, down 0.36 percentage points, according to a provisional estimate from the Bangladesh Bureau of Statistics. The private investment-GDP ratio declined for the first time last fiscal year. Public investment, on the other hand, rose 0.66 percentage points to 7.30 percent, to take the overall investment-GDP ratio to 28.69 percent, up 0.30 percentage point year-on-year. A big portion of private investment comes through bank finance, and related banking data shows that investment is still in a stagnant situation. Between June 30 last year and February 28 this year, the amount of excess liquidity in the banking sector swelled 78 percent to Tk 1,35,436 crore, according to data from the central bank.
959 unapproved fresh projects in FY 15 ADP: The government has included 959 unapproved fresh development projects in the Annual Development Programme (ADP) for the next fiscal year (FY) 2014-15 without giving any fund allocations, officials said Saturday. Presided over by Prime Minister Sheikh Hasina, the National Economic Council (NEC) on May 20 approved the Tk 803.15 billion ADP where the 959 fresh projects were incorporated in addition to the 1,034 ongoing ones for implementation in the next fiscal year. The newly-approved development budget has incorporated 683 unapproved projects that are proposed to be financed from domestic resources, and another 276 unapproved ones that are expected to be funded by different bilateral and multilateral donors.
Jobless workers not getting lawful benefits: More than 12,000 garment workers who lost their job due to production suspension at 20 factories at the suggestion of Alliance and Accord, two retailers’ groups, are yet to get their termination benefits stipulated in the labour act from their respective companies. Labour leaders alleged that the owners of the garment factories were taking advantage of workers’ lack of consciousness and hapless situation and the government was protecting the interest of the owners. Since February this year the inspection teams of Accord on Fire and Building Safety in Bangladesh, a European Union retailers’ platform, and Alliance for Bangladesh Worker Safety, North American retailers’ platform, inspected more than 1,000 garment factories and detected serious structural faults at more than 30 factories. The retailers’ groups sent the inspection reports to the review panel comprising representatives from the government, Accord, Alliance, BUET and BGMEA with the suggestion of immediate evacuation of the buildings. The review panel has so far closed seven factories and suspended production at 13 others.
Financial Reporting Act bill likely to be passed in next JS session: The bill on the proposed Financial Reporting Act (FRA) is likely to be passed by the Jatiya Sangsad (JS) in its upcoming budget session for setting up the Financial Reporting Council (FRC), officials said. The officials of the Bangladesh Securities and Exchange Commission (BSEC) said the FRA is under the active consideration of the Ministry of Finance to curb the window-dressed balance sheets. “So far as we know, the FRA bill will be placed in the parliament during upcoming budget session,” said a BSEC policy-maker. BSEC Executive Director Mohammad Saifur Rahman said formation of the FRC is also a condition, among others, for disbursing funding of the capital market development project by the Asian Development Bank (ADB).
BBN/SSR/AD-25May14-9:08 am (BST)