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Capital Account Transaction (Overseas Equity Investment) Rules 2022 have similar provisions.

A latest policy preparation facilitating Bangladeshis making offshore investment in foreign countries gets into a dilemma as some officials mentioned that an already-existing law on ‘Capital Account Transaction’ holds identical provisions.

Sources said different state agencies, including finance ministry and Bangladesh Bank (BB), were not in favour of making the new policy on this issue.

They believe that there is no need to prepare a separate policy on the matter under Bangladesh Investment Development Authority (BIDA) as there is a law styled ‘Capital Account Transaction (Overseas Equity Investment) Rules 2022’ in the country.

“The authority will send a summary paper to PMO (Prime Minister’s Office) to attach opinions…,” says one official, adding that the entire opinions will be put in the paper to consider whether the proposed policy can be prepared or not.

An inter-ministerial committee formed by the PMO has prepared the draft of the policy titled ‘Bangladeshis Foreign Investment Abroad 2021.’ The draft was already submitted to the PMO on September 29, 2021.

However, it finds similarity in the objectives and contents between the existing and proposed policies.

In this circumstance, the sources said, the PMO instructed the Financial Institutions Division and the central bank (Bangladesh Bank) to take next course of action.

In that context, the inter-ministerial committee was presented a comparative statement on the final draft of the ‘Capital Account Transaction (Overseas Equity Investment) Rules 2022’ and the ‘Bangladeshi Foreign Investment Policy 2021’ in its 6th meeting.

It also decided to send the draft Bangladeshis Foreign Investment Policy to all the member-agencies and trade bodies, including foreign affairs, and agriculture ministries, finance division, BB, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) for eliciting their opinions.

Only eight agencies, including foreign, and agriculture ministries, FBCCI, Dhaka Chamber of Commerce & Industry (DCCI) and Bangladesh Securities and Exchange Commission (BSEC) suggested some amendments and additions to the policy.

On the other hand, three agencies-finance division, FID and BB-recommended that there is no need for a separate policy as already there is Foreign Equity Investment) Rules 2022. The dissent came at the 7th meeting of the committee.

“The members of the inter-ministerial committee framed the draft policy through stakeholder consultations and workshops in different levels for around three years,” reads the meeting minutes.

Contacted, a senior official said, “We will send the draft policy to the PMO for taking next decision. All members of the high-powered committee have given same opinions on PMO decision about the policy.”

He said it’s for the BIDA to take decision on the policy according to the PMO instructions.

According to the existing Capital Account Transaction (Overseas Equity Investment) Rules, Bangladeshi exporters can make overseas equity investment subject to sufficient balance in their export-retention quota (ERQ).

In this past January, the Financial Institutions Division issued the Capital Account Transaction (Equity Investment Abroad) Rules 2022 under Section 26 of the Foreign Exchange Regulation Act 1947.

In this context, some conditions and provisions have been laid down in the existing rules. The applicant will be able to invest 20 per cent of the average annual export earnings of the organization for five years or less than 25 per cent of the net assets shown in the latest audited annual financial report as equity abroad under rules.

Source: The Financial Express

Runner Automobiles yesterday launched the country’s first “Made in Bangladesh” autorickshaws for the local and foreign markets.

Runner Automobiles yesterday launched the country’s first “Made in Bangladesh” autorickshaws for the local and foreign markets.

At least 70 per cent of the vehicle except for some components of the engine have been made locally through technical collaborations with Indian automaker Bajaj Auto, said Hafizur Rahman Khan, chairman of Runner Group.

Around 30,000 autorickshaws run by liquefied petroleum gas and compressed natural gas will be produced a year at Runner Automobiles’ three-wheeler plant in Mymensingh’s Bhaluka, he said at the launch.

Some 300 local and 400 foreign workers have already been employed for the 10-acre Runner factory established at a cost of about Tk 300 crore, Khan said.

“A few local organisations have also cooperated with us. This vehicle will help in transportation of the common mass along with creating more jobs.”

“Through this, a domestic company for the first time brought a three-wheeler autorickshaw to the market after manufacturing it in the country,” said Salman F Rahman, prime minister’s adviser on private industries and investment, after inaugurating the plant.

Although the autorickshaws have been produced in the country, Bangladesh still has to import 20-30 per cent of the parts to make the three-wheeler, Rahman said.

“We want to be fully capable of manufacturing three-wheelers. Runner will fulfil this gap in future.”

He said the government will extend all-out support for the expansion of the export-oriented automobile industry.

Domestic companies should adopt modern technologies to increase production and remain competitive, he said.

“Runner is the first manufacturer and exporter of motorcycles in Bangladesh,” said Subir Kumar Chowdhury, managing director and CEO of Runner Automobiles.

“With the autorickshaw, we entered into the three-wheeler industry today. We hope we will be successful in this industry like motorcycles.”

“This is not only the first three-wheeler factory in Bangladesh, but also the first Bajaj three-wheeler factory outside of India,” said KS Grihapati, president of Bajaj Auto.

“We are excited to work with Runner. The organisation has already proved their capabilities.”

He said Bajaj will contribute to the development of automobile industry in Bangladesh.

There are about five lakh three-wheelers in the country, but only one lakh are registered, said Abdul Matlub Ahmad, president of Bangladesh Automobiles Assemblers and Manufacturers Association and chairman of Nitol-Niloy Group.

“It becomes difficult to hold these vehicles accountable in case of an accident.”

The government should take strong measures to ensure registration of all three-wheelers in the country, he said.

Source: The Daily Star

Chattogram Custom House, the largest customs station in the country, witnessed a decline in revenue growth in the first seven months of the current fiscal year 2022-23, due to fall in imports amid the ongoing dollar crisis and global slowdown due to the Russia-Ukraine war.   

The customs station reported negative growth in December and January following zero growth in the sixth and seventh months.

According to data from the customs house, the revenue growth was 40.87% in July of FY 2022-23, which declined to 24.67% in August and -0.17% in September. Afterwards, the growth increased to 3.91% in October and 14.13% in November.

The growth in revenue collection again dropped in the next two months. The growth was -9.18% in December and -4.38% in January.

The customs station posted 8.28% overall growth in the July-January period of the FY 2022-23, which was 25.26% during the same period of the FY 2021-22—a decrease by 17% in the seven months.

In January of FY 2022-23, the customs house collected Tk4,744.61 crore as revenue, less by 28.67% than the target of Tk6,652 crore. In December, the revenue collection was Tk4,388.05 crore against the target of Tk6,604 crore.

The target of revenue collection was set at Tk74,206 crore in the fiscal year 2022-23. Tk34,915.74 crore was collected during the July-January period against the target of Tk43,212 crore in the seven months. The earnings were recorded at Tk32,246.53 crore during the same period in FY 2021-22.

In the first seven months of the FY 2022-23, revenue collection was less by Tk8,296.26 crore or 19.20% than the target.

In the FY 2021-22, the Chattogram Customs House collected Tk59,159.83 crore against the target of Tk64,159.83 crore, posting a growth of 14.70%.

“The revenue collection in the current fiscal year has decreased compared to the previous year. Imports of low-duty products, especially food items and capital machinery have increased. But revenue collection has decreased due to decrease in imports of luxury goods including cars, cosmetics, electronics, which are high revenue collection,” Md Bodruzzaman Munshi, deputy commissioner of Chattogram Customs House, told The Business Standard.

“Earlier, the price of the dollar was Tk84, which has now crossed Tk100. As a result, the traders have to pay extra in both the price of the imported goods and the duty. On the other hand, customs revenue has also decreased. I do not see any solution to this crisis until the war situation becomes normal,” Chattogram Chamber of Commerce and Industry President Mahbubul Alam told TBS.

Chattogram Customs House collects duty on goods imported through Chattogram Port, which oversees 92% of the country’s import and export trade.

Apart from the country’s main seaport, the customs house also collects duty on goods coming through Shah Amanat International Airport in the port city.

Source: TBS News

Bangladesh’s domestic consumer market is set to become the ninth-largest in the world, a report says