May 21, 2015
According to Bangladesh Bureau of Statistics (BBS), the per capita income in Bangladesh has risen from $1,190 in the previous financial year to $1,314 in the current financial year. Bangladesh economy now ranks 58th on the basis of the current per capita income. The rising per capita income brings Bangladesh ever more close to the vision of the Awami League government to turn the country into a middle-income one by 2021. The data also reveals that the GDP grew at 6.51% in the current fiscal year, marking more than 6% growth rate for six straight years.
Incoming remittances to Bangladesh is likely to hit an all time high according to forecasts by the Bangladesh Bank. Until May 15, that is the first ten and a half months of the current financial year, expatriate Bangladeshis remitted $13.24 billion back to their country, marking a 7.2% growth over the same period from previous fiscal year. Given the trend, the annual remittance for the 2014-2015 year is expected to be $15.35 billion. If the forecasts are realized, this will overtake the previous highest remittance of $14.46 billion received in the 2012-2013 fiscal year.
The top global credit rating agency Standard & Poor (S&P) has reaffirmed the BB-rating for Bangladesh and projected a ‘stable outlook’ for its economy for the sixth consecutive year. In a research update published last Wednesday, S&P assessed Bangladesh's external liquidity as strong and commented that the economy has a record of steady growth with minimal fluctuation. Last month, another top global ratings agency, Moody’s Investor Service, had projected Bangladesh’s outlook as stable for the current year and bestowed a Ba3 rating on the country.
According to a report published by UNESCAP titled 'Economic and Social Survey of Asia and the Pacific 2015', Bangladesh is ahead of both India and Pakistan in terms of inclusive growth. The report pointed out that Bangladesh’s economy is more insulated from external shocks, such as the 2008 global financial crisis, due to domestic consumption playing a big role. The report also highlighted that unemployment is relatively low in the country. The country has excelled primarily because of policy interventions in reducing poverty and improving food security.
The government will expand its social safety net programmes by increasing the number of benefit recipients by an additional 400,000 people in the upcoming national budget. An additional US$ 25.7 million will be required by the government for this purpose. Currently, 5 million people receive benefits under the various social safety net schemes. The principal beneficiaries for the expanded numbers come from such categories as old people, deserted and destitute women, disabled persons, and maternity allowance for poor and lactating mothers.
The government will build around 1,320 low-cost flats for low- and middle-income groups in Dhaka under Public-Private Partnership (PPP) basis. The proposed apartments, equipped with all modern amenities, will be built by creating a satellite town on 5 acres of land at Mirpur. A feasibility study has been conducted to implement the project using the new Insulated Concrete Form (ICF) technology to keep the costs relatively low. The government will provide lands as capital investment while the private sector will bear the construction costs.
The government has moved to bolster the capacity of Bangladesh Coast Guard to check crimes like human trafficking and safeguard the county's seafront. Under the $60.2 project, the coastguard will procure three inshore patrol vessels, six high-speed boats, one floating crane, and some other necessary equipment for strengthening sea and coastal vigilance. The proposed project will help to check illegal migration and smuggling, protect fisheries and sea resources under the country's special economic zone, and ensure security of the country.
The government has decided to expand the activities of National Foundation for Development of the Disabled Persons to Upazila level gradually for providing holistic services to disabled people. The government has also announced to increase the number of social welfare beneficiaries getting monthly allowance from the government from 400,000 to 600,000. The amount of such benefit will be increased from the current 350 Taka to 500 Taka. Further facilities for disabled people will be extended to sports, healthcare and accommodation.
The government has decided to recruit transgender or hijras as traffic police officials from the next fiscal year to rehabilitate them in society via employment. The appointments, however, would be based not only on gender identity, but also educational and other qualifications. Details about the recruitment process would be fixed following further analysis by the government. Hijras, who are neither male nor female, have officially been recognised as a separate gender in Bangladesh since 2013 and get priority for education and other rights.
Trade and Investment
The International Finance Corporation, private sector wing of World Bank group, has formally proposed to Bangladesh to launch $1 billion taka-linked bonds. According to the proposal sent to the Finance Ministry, the multilateral lender said such bonds would attract new foreign investors to Bangladesh. The proposal highlighted that issuance of such bonds will signal the confidence offshore investors have in the stability of the Bangladesh economy and currency and also allow foreign investors to gain easier access to investments in Taka.
Two varieties of Bangladeshi mangoes are being exported by the world’s leading retailer Walmart for the UK market. A total of 2,160 Kgs of mangoes are being exported in the first two consignments this month. The government's department of agricultural extension (DAE), the UN Food and Agriculture Organisation (FAO) and Bangladesh Hortex Foundation are assisting with the matter, seen to open a new horizon for fruit exports. In a related development, Bangladeshi organic products are all set to enter the mainstream European market from July next year.
Investment by Bangladeshis overseas has been witnessing a steady rise. According to statistics of Bangladesh Bank, investment from Bangladeshis outside the country was US$ 48.37 million in 2014. This amount marked a 43% growth than the amount invested in 2013, which was $33.73 million. The top two sectors in which Bangladeshis invested are banking and mining. Some US$ 34.68 million was invested in banking while US$ 13.69 million was invested in the mining sector. India featured top in the list of 12 countries where such investment ended up.
The government is undertaking a number of steps to tap into the country’s hydropower potential. A hydro-power company will be formed which will not only generate but also import this kind of green electricity from neighbouring countries like Nepal and Bhutan. A recent study conducted by a US consultancy firm Streams Tech Inc. said that two rivers in the Chittagong Hill Tracts, Sangu and Matamuhuri, could potentially generate 79 MW hydropower. The 230MW Karnafuli Power Station is currently the only major source of hydro-power in Bangladesh.
A joint feasibility study has begun on the construction of a 129 kilometre (Km) cross-country petroleum pipeline between Bangladesh and India. Of the 129-km pipeline route, 124 Km will be inside Bangladeshi territory while the remaining 5 Km will be inside Indian territories. The pipeline will carry petroleum products from India's Numaligarh refinery into Bangladesh's 'master' petroleum depot. An India-Bangladesh joint venture (JV) firm will be tasked with building the pipeline, the aggregate costs of which will be borne by both the countries.
China has formally approached Bangladesh to join the “One Belt One Road” initiative, a move to revive the historic Silk Route through land and sea for economic development. Bangladesh has already indicated its positive response to this initiative. China has expressed its desire to sign a memorandum of understanding (MoU) with Bangladesh to seal the deal. ‘One Belt One Road’ is a Chinese framework for organising multinational economic development primarily in Eurasia through two main components, the land-based Silk Road and oceangoing Maritime Silk Road.
The trial run for a planned direct bus service between Dhaka, Bangladesh and Guwahati, India will start tomorrow, that is the 22nd of May 2015. The trial run would allow authorities of both countries to fix convenient schedules having regard to such issues as traffic, immigration, customs and terrain. The date was announced by Road, Bridges and Transport Minister Obaidul Quader as he met with his Indian counterpart in New Delhi this week. The deal on the service is expected to be signed during Indian Prime Minister Narendra Modi's upcoming visit to Dhaka.
US based Ivy League institution Cornell University has officially praised Bangladesh Prime Minister Sheikh Hasina’s contributions to her country’s agricultural development. A letter from the university was handed over to the Bangladesh Premier on Wednesday by Professor Ronnie Coffman. During the meeting between the two, PM Sheikh Hasina said food sufficiency in Bangladesh had been made possible by her government’s measures for agricultural progress and that now her government’s target is to ensure nutrition for Bangladesh’s 160 million people.
Nepal Prime Minister Sushil Koirala has conveyed his gratitude to Prime Minister Sheikh Hasina for Bangladesh’s quick response in the relief and rescue operations in the aftermath of the recent devastating earthquakes. The Nepalese PM called his Bangladeshi counterpart on Wednesday evening and thanked the latter for promptly sending emergency relief materials and a medical team after the disaster. The Bangladesh PM assured him of sending more house-building materials and offered the use of Syedpur and Ishwardi airports to carry relief and other materials.
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