Staff Reporter :
The Bangladesh Bank’s recent decision to raise the dollar price by Tk 7 to Tk 117 has sparked mixed reactions from economists and businesses across the country.
Economists believe the government should re-evaluate export incentives following the significant dollar price hike.
Dr. Binayak Sen, Director General of the Bangladesh Institute of Development Research (BIDS), argues that continuing export incentives becomes “unjustified” with the increased dollar price benefitting exporters substantially. He proposes redirecting these funds towards crucial sectors like social security.
Dr. Masiur Rahman, Economic Advisor to the Prime Minister, echoed similar sentiments, suggesting a performance-based approach to export incentives. He emphasizes identifying high-potential export sectors for targeted support.
Opposing the proposed withdrawal, Faruque Hassan, immediate past president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), emphasized the export sector’s role as a primary source of foreign currency, which Bangladesh critically needs.
He stressed maintaining the sector’s competitiveness and urged the government to continue existing support measures.
The Bangladesh Shop Owners Association (BSOA) expressed concerns about the impact on consumers. President Helal Uddin anticipates rising import costs leading to price hikes across various goods. He fears this will exacerbate inflation and put further strain on ordinary citizens.
The central bank’s move comes amid declining foreign currency reserves, which dropped by $133 million to $19.83 billion within a week. Protecting these reserves and encouraging exports were cited as key reasons for the devaluation and introduction of a crawling peg system.