The export and remittance sectors of Bangladesh ended 2023 with less than 3 percent growth year-on-year. The slowing growth in earnings from the country's two biggest sources of foreign currency means that its woes originating from the international currency crunch continue into the new year. Earnings from merchandise shipments rose 1.99 percent to $55.78 billion in the just-concluded calendar year because of the slowdown in apparel sales in the international markets, data from the Export Promotion Bureau (EPB) showed yesterday.

Migrant workers sent home $21.91 billion in 2023, a year-on-year increase of just 2.96 percent, according to the central bank. The lower-than-expected export and remittance earnings have a direct impact on the foreign exchange reserves, which have fallen steeply over the last two years. The sharp decline in the forex stock has created headaches for policymakers as the country failed to meet the International Monetary Fund (IMF) threshold on minimum international reserves as part of the conditions of the $4.7 billion loan programme.

The Dhaka Metropolitan Police imposed several restrictions on vehicular movement with a view to holding the January 7 parliamentary elections in a free, fair and peaceful manner. According to a media release signed by DMP commissioner Habibur Rahman, restrictions have been imposed on the movement of taxi cabs, pickups, microbuses, trucks and some other vehicles in Dhaka metropolitan area from 12am on January 6 to midnight on January 7. At the same time, a ban has also been imposed on the movement of motorcycles from midnight on January 5 to midnight on January 8, reads the release.

Exemptions have been mentioned for vehicles carrying law enforcement agencies, armed forces, administration and permitted observers, as well as those engaged in emergency services and all types of vehicles carrying medicines, health-medical and similar goods and newspapers. Restrictions will also be relaxed on important roads, highways and connecting main roads for exit or entry from Dhaka metropolis or all such roads.

The government's net borrowing from the country's banking sector was Tk 7,846 crore negative in July-December, as the government borrowed Tk 27,952 crore from the commercial banks but repaid Tk 35,789 crore to the central bank, according to Bangladesh Bank data. The net government borrowing from the banking sector was Tk 26,097 crore in July-December in 2022. Bankers said excessive government borrowing from the commercial banks could worsen the existing liquidity crisis in the banking sector.

The excess liquidity in the banking sector dropped to Tk 1.6 lakh crore in October from Tk 1.7 lakh crore in September. The banking sector is facing challenges due to increased distressed assets, particularly non-performing loans, and a slow deposit growth. In the previous financial year (2022-23), the government borrowed Tk 1.24 lakh crore from the banking sector, with Tk 98,826 crore borrowed from the central bank and Tk 25,296 crore from the commercial banks.

The government issued special bonds worth Tk 3,016 crore to two banks in order to clear arrears on behalf of fertiliser importers. The importers had opened letters of credit with the banks to bring over fertilisers, the payment for which is long overdue from the government. A four-party agreement was signed for the payment and the bonds were issued against state-owned Sonali Bank and privately-owned IFIC Bank at the policy rate or repo rate, which is now 7.75 percent.

The repo rate is the interest rate at which the central bank lends money to commercial banks. The Finance Ministry issued bonds worth Tk 2,557 crore to Sonali Bank on behalf of Bangladesh Chemical Industries Corporation (BCIC) and Bangladesh Agricultural Development Corporation (BADC). Additionally, bonds worth Tk 459 crore were issued to IFIC Bank on behalf of four private sector fertiliser importers.