daily news flash, 6th july, 2017 - eblsecurities.com · the stockbroker noted that decline in bank...

Daily News Flash, 6th July, 2017

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CORE INDEX RISES TO RECORD HIGH OF 5,783 POINTS ...................................................... 1

INVESTORS TAKE POSITION ON SECTOR-SPECIFIC STOCKS ................................................. 2

GOVT INKS DEAL WITH QATAR TODAY FOR LNG IMPORT .................................................. 3

TELCOS LOSE TRIBUNAL BATTLE OVER TK 2,048CR SIM REPLACEMENT TAX ....................... 4

INVESTMENT IN SAVINGS TOOLS CROSSES TK 50,000CR IN FY17 ....................................... 5

MUHITH HINTS AT CHANGING FISCAL YEAR ...................................................................... 6

GOVT IN CRITICAL POSITION TO MAKE UP TK 20,000CR REVENUE SHORTFALL: MUHITH .... 7

5 LAKH TONNES OF CRUDE SALT TO BE IMPORTED ............................................................ 8

IDB APPROVES $95.24M LOAN FOR RURAL HOUSING PROJECT IN BANGLADESH ............... 9

PHARMA SECTOR TO GROW AT 15PC A YEAR: STUDY ...................................................... 10

SALES OF SAVINGS TOOLS SURGE ................................................................................... 11

CREDIT GROWTH DIPS IN MAY AFTER FIVE MONTHS ....................................................... 12

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CORE INDEX RISES TO RECORD HIGH OF 5,783 POINTS Core index of the premier bourse Wednesday rose to its highest level since the inception in January, 2013. Stocks extended the winning streak for the three consecutive sessions on the day. Analysts said the market maintained the upturn and the rally took the key index to a new high thanks mainly to the continuous shining of sector specific large-cap issues. "The market sustained large-cap driven gaining momentum as the issues continued to jack the investors' sentiment up, taking the prime index of the premier bourse to new high," said an analyst at a leading brokerage firm. DSEX, the prime index of the Dhaka Stock Exchange (DSE), which replaced the DGEN in four-and-a-half-year back, added 22.15 points or 0.38 per cent to settle at a new high of 5,783 points, surpassing the previous high of 5,777 points recorded on April 4 this year. The country's prime bourse launched the DSE Broad Index (DSEX) on January 27, 2013 with a base point of 4,055.90, replacing the DSE General Index (DGEN). In the past four-and-a-half years since its inception, DSEX added nearly 1,727 points, while it added 320 points within 10 trading sessions. However, DGEN, the then key index of the DSE, rose to an all-time high at 8918.51 points on December 5, 2010, when the market was bullish before crash. In unison with prime index, the total market capitalisation of the DSE also reached to a fresh all-time high of Tk 3,883 billion on the day, surpassing the previous high of Tk 3,875 billion recorded on Tuesday.

DSEX 22.16 Gold (Ounce) $1,220.10 Dollar 80.60 (Buy) 80.60 (Sell)

CSCX 29.87 Oil (Barrel) $46.49 Euro 91.42 (Buy) 91.47 (Sell)


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After four hours trading, DSEX went up by 22.15 points or 0.38 per cent to reach fresh high of 5,782.6, the highest level since its introduction on January 27, 2013, International Leasing Securities said, "Spontaneous participation backed by optimism coupled with persistent upbeat market trend tempted the sideline investors to inject fresh fund on stocks". The stockbroker noted that decline in bank interest rate and possible cut in savings certificate rate turned the market more attractive for the investors. "Buying spree in several issues mostly from miscellaneous, fuel & power, bank and food & allied sectors surged the prime index of DSE, which was in the highest point since the inception," said the stockbroker. The two other indices also maintained the positive trend. The DS30 index, comprising blue chips, advanced 6.34 points or 0.30 per cent to close at 2,120.77. The DSE Shariah Index (DSES) gained 3.46 points or 0.26 per cent to stand at 1,317.61. The turnover, an important indicator of the market, stood at Tk 11.65 billion on the country's premier bourse, which was 4.82 per cent lower than the previous day's mark of Tk 12.24 billion. Textile sector kept its dominance in turnover chart for the six running sessions, capturing 17 per cent of the day's total transaction, followed by bank with 14 per cent and pharmaceuticals 12 per cent. IDLC Investment, a leading merchant bank, said, "Positive sentiment prevailed which lifted up the overall market". The port city bourse, the Chittagong Stock Exchange (CSE), also closed higher with its Selective Categories Index - CSCX - advancing 30 points to settle at 10,825. Gainers beat losers as 126 issues closed higher, 101 closed lower and 29 remained unchanged on the CSE. The port city bourse traded 24.56 million shares and mutual fund units' worth Tk 694 million in turnover. Source: http://print.thefinancialexpress-bd.com/2017/07/06/177016

INVESTORS TAKE POSITION ON SECTOR-SPECIFIC STOCKS The Dhaka bourse Wednesday closed marginally higher, featuring highest record in broad index and market capitalisation. On the day, the market started positively and shortly afterwards it witnessed some correction as investors opted to bag profits on the Dhaka Stock Exchange (DSE). Soon later, the DSE broad index DSEX bounced back as investors took position on sector specific stocks. At the end of the session, the DSEX closed at 5,782 points, which was the highest mark after introduction of the index, with a rise of 0.38 per cent or 22 points. The market capitalisation featured the highest ever value of above Tk 3.88 trillion on the premier bourse DSE. The shariah-based index DSES gained 0.26 per cent or 3.46 points to close at 1,317.61, while the blue chip index DS30 went up by 0.29 per cent or 6.34 points to close at 2,120.77. According to EBL Securities, the premier bourse continued its upward trend following investors' increased participation on most of the stocks. "Banking sector was investors' number one choice while fuel & power and food & allied sectors were also in investors' concentration," said the EBL Securities. Of 329 issues traded, 148 advanced, 136 declined and 45 were unchanged on the premier bourse DSE. At the end of the session, the turnover stood at above Tk 11.64 billion which was 4.80 per cent less than the turnover of the previous session. `A' category companies featured a turnover of above Tk 10.03 billion, while `B' category companies featured Tk 571 million, `N' category companies Tk 410 million and `Z' category companies Tk 208 million.

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Among the gaining sectors, fuel & power sector rose 0.70 per cent, bank 0.5 per cent, general insurance 1.0 per cent, financial institutions 0.1 per cent, pharmaceuticals & chemicals 0.2 per cent and real estate 0.7 per cent. Among the losing sectors, tannery declined 0.5 per cent, telecommunication 0.1 per cent, textile 0.6 per cent and travel & leisure 0.3 per cent. Investors' participation was concentrated mostly in the shares of textile sector which captured 17.80 per cent of the market turnover followed by bank 14.30 per cent, financial institutions 11.90 per cent, fuel & power 11.90 per cent and pharmaceuticals & chemicals 11.30 per cent. Baraka Power topped the turnover chart with a value of Tk 444 million followed by Keya Cosmetics Tk 331 million, LankaBangla Finance Tk 313 million, Paramount Textile Tk 277 million and Regent Textile Tk 272 million. National Housing Finance and Investment was the number one gainer with a rise of 9.84 per cent to close at Tk 55.80, while Beach Hatchery was the worst loser after declining 7.5 per cent to close at Tk 18.50. Source: http://print.thefinancialexpress-bd.com/2017/07/06/177022

GOVT INKS DEAL WITH QATAR TODAY FOR LNG IMPORT The government inks an agreement with Qatar today (Thursday) to import 1.8 million tonnes of liquefied natural gas a year from next year to meet the growing demand, officials said. "The energy division is scheduled to hold a meeting with Qatar's state-run RasGas Company Limited (RasGas) for price negotiations at Petrocenter tomorrow," an energy official said. He said a RasGas delegation would arrive in the city on Thursday and hold the meeting for the import of LNG, which will begin from April or May next year, reports BSS. The government is expected to import 500 mmcfd LNG a day. Earlier, State Minister for Power, Energy and Mineral Resources Nasrul Hamid told the news agency the government would soon sign a contract with Qatar for LNG import. He said that the government would also keep some other sources open for LNG import to mitigate the gas crisis. According to the ministry, the government signed a memorandum of understanding (MoU) with Qatar in January 2011 to import approximately 4.0 million tonnes of LNG annually. Now, Petrobangla, the state-run oil, gas and mineral resources corporation, supplies approximately 2,750 million cubic feet of natural gas a day from domestic gas fields against a demand for at least 3,500 million cubic feet gas, said the ministry. Meanwhile, Petrobangla signed two contracts with a foreign and a local company to facilitate increasing the daily gas supply by 1,000 million cubic feet from imported LNG by their floating terminals and re-gasification units to be set up near Maheskhali Island in Cox's Bazar. On January 3, 2017, Petrobangla signed a deal with Summit LNG Terminal Company Private Limited, a subsidiary of Summit Group, for LNG re-gasification service from its facilities to be built in 18 months. On July 18, 2016, Petrobangla also signed a contract with US Company Excelerate Energy for LNG re-gasification service from its facilities to be built in 18 months. Both the contracts are on the built-own-operate-and-transfer basis and would be valid for 15 years. The RasGas is one of the world's major integrated LNG enterprises and has reputation for being a reliable supplier of LNG that has transformed a regional resource into a key component of the global energy mix. Source: http://print.thefinancialexpress-bd.com/2017/07/06/177007

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TELCOS LOSE TRIBUNAL BATTLE OVER TK 2,048CR SIM REPLACEMENT TAX The National Board of Revenue has demanded Tk 883.32 crore from four mobile phone operators alleging that they had dodged the amount as SIM replacement tax between July 2012 and June 2015. The operators Grameenphone, Robi, Banglalink and Airtel also last month lost a legal battle at NBRs VAT appellate tribunal regarding previous dispute over SIM replacement tax worth Tk 2,048 crore, officials said. The Large Taxpayers Unit (value-added tax) on June 29 issued the demand notices after second phase scrutiny of the authenticity of SIM replacement data provided by the operators and asked them to pay the amount to government exchequer within 15 days, officials said. In first phase, the LTU (VAT) in 2012 conducted an audit on SIMs replaced by the operators between July 2007 and December 2011 and demanded Tk 2,048 excluding interest amount as SIM replacement tax from the companies saying that they dodged the amount in the replacement process. The initial demand including 2 per cent monthly interest was Tk 3,010.99 crore. In the process, according to the NBR report, the operators dodged the amount in SIM replacement tax through selling old SIMs to new clients but declaring replacement to original subscribers as there was no tax on replacement till June 2014 while SIM tax on new SIM was Tk 300. Currently, tax on both new and replacement SIMs is Tk 100. The operators have always been denying the allegations and filed case at VAT Appellate Tribunal of the NBR against the demand. The tribunal on June 22 gave its verdict in favour of the NBR and asked the operators to pay Tk 2,048 crore. The operators will have 90 days for complying with the verdict or challenging the verdict at Supreme Court. Officials of the LTU said that they had already issued a notice to the Supreme Court so that the operators cannot receive stay order unilaterally against the verdict from the court keeping the VAT office unnoticed. LTU commissioner Md Matiur Rahman on Wednesday told New Age that they would implement the tribunals verdict following legal process after expiry of the time-frame. In addition to the disputed amount, the operators will also have to pay penalty and interest amount at the rate of 2 per cent per month for delay in payment, he said. In the second phase, officials said that the LTU (VAT) found the evasion while scrutinising the VAT returns of the companies. A tripartite committee of the LTU (VAT) formed in early March consists of representatives from LTU (VAT), Bangladesh Telecommunication Regulatory Commission and the Association of Mobile Telephone Operators of Bangladesh held several meetings to verify the authenticity of the data related to SIM replacement. In the meetings, the representatives of the operators in the committee could not prove the authenticity of their claims of SIMs which they showed in their returns as replacement SIMs during the period, they added. Of the amount, GP dodged the highest amount of Tk 378.95 crore, Robi Tk 285.20 crore, Banglalink Tk 168.91 crore and Airtel evaded Tk 50.26 crore in the period through selling new SIMs which they claimed as replacement. AMTOB secretary general TIM Nurul Kabir denied making any comment over tribunals verdict. He claimed that the previous demand was made on fictitious base. Regarding the new demand, he said that the NBR could have verified the authenticity of SIM replacement using the BTRCs database where all SIMs are biometrically verified.


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He said that the new demand would throw a negative message to future investors and would impede future investment in the sector. The dispute could have been solved through administrative process in line with the finance ministrys directives made in 2015, he said. Source: http://www.newagebd.net/article/19097/telcos-lose-tribunal-battle-over-tk-2048cr-sim-replacement-tax

INVESTMENT IN SAVINGS TOOLS CROSSES TK 50,000CR IN FY17 The net investment in the national savings certificates and bonds is set to cross Tk 50,000 crore for the first time in the countrys history in the just concluded financial year 2016-17 as the net sales of the savings tools stood at Tk 46,669 crore in the first 11 months of the year. According to the latest data of the Directorate of National Savings, net investment in the tools increased by 55.08 per cent to Tk 46,669 crore in the July-May period of FY17 compared with that of Tk 30,092 crore in the corresponding period of FY16. A DNS official said that although they were yet to get the investment data of June, the net investment in the savings tools might have crossed Tk 50,000 crore in the FY 17 as there was huge rush to buy the NSCs in the last month of the year. The net investment in the savings tools stood at Tk 4,571 crore in May, Tk 4,450 crore in April, Tk 4,366 crore in March, Tk 4,388 crore in February and Tk 5,420 crore in January this year. DNS and Bangladesh Bank officials said people had been maintaining a huge investment in the last few months as the government earlier hinted at lowering the rate on the tools with a view to reducing the interest rate gap between the NSCs and other rates of deposit products offered by the banks. The government, however, is yet to take any final decision whether it will cut the rate on the tools, they said. People are now being forced to invest their money in the NSC savings tools as the banks are offering hardly 7 per cent interest rate on their deposit products. The rates offered by the NSCs are between 11.04 per cent and 11.76 per cent, a BB official said. Besides, a section of people including politicians and bureaucrats are also making huge investment to enjoy higher returns from the tools, he said. The high returns on the savings tools are pushing up the governments interest liability as the government usually borrows from treasury bills and bonds, that carry interest rates between 2.84 per cent and 7.60 per cent, to manage its deficit financing of the fiscal budget, he said. In the budget for FY17, the government aimed to borrow Tk 19,610 crore from the NSCs, but it later revised the figure and set a borrowing target of Tk 45,000 crore. The BB official said that the high net investment in the savings tools would continue this fiscal year if the government did not cut the rate on the savings tools. Former caretaker government adviser Mirza Azizul Islam told New Age on Wednesday that people had opted to invest in the savings tools as the interest rate on the deposit products offered by the banks was now equivalent to the inflation rate. In many cases, the rate on the banks products is below inflation rate resulting that people are making investment in the tools heavily in recent time, he said. The situation will not improve despite the government cut two-three per cent interest rate on the savings tools due to the much lower rate on the banks deposit products, he said. Against the backdrop, the government should stop selling the national savings certificates when its budgetary borrowing target will be fulfilled, he pointed out. The net investment in the national savings certificates and bonds is set to cross Tk 50,000 crore for the first time in the countrys history in the just concluded financial year 2016-17 as the net sales of the savings tools stood at Tk 46,669 crore in the first 11 months of the year. According to the latest

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data of the Directorate of National Savings, net investment in the tools increased by 55.08 per cent to Tk 46,669 crore in the July-May period of FY17 compared with that of Tk 30,092 crore in the corresponding period of FY16. A DNS official said that although they were yet to get the investment data of June, the net investment in the savings tools might have crossed Tk 50,000 crore in the FY 17 as there was huge rush to buy the NSCs in the last month of the year. The net investment in the savings tools stood at Tk 4,571 crore in May, Tk 4,450 crore in April, Tk 4,366 crore in March, Tk 4,388 crore in February and Tk 5,420 crore in January this year. DNS and Bangladesh Bank officials said people had been maintaining a huge investment in the last few months as the government earlier hinted at lowering the rate on the tools with a view to reducing the interest rate gap between the NSCs and other rates of deposit products offered by the banks. The government, however, is yet to take any final decision whether it will cut the rate on the tools, they said. People are now being forced to invest their money in the NSC savings tools as the banks are offering hardly 7 per cent interest rate on their deposit products. The rates offered by the NSCs are between 11.04 per cent and 11.76 per cent, a BB official said. Besides, a section of people including politicians and bureaucrats are also making huge investment to enjoy higher returns from the tools, he said. The high returns on the savings tools are pushing up the governments interest liability as the government usually borrows from treasury bills and bonds, that carry interest rates between 2.84 per cent and 7.60 per cent, to manage its deficit financing of the fiscal budget, he said. In the budget for FY17, the government aimed to borrow Tk 19,610 crore from the NSCs, but it later revised the figure and set a borrowing target of Tk 45,000 crore. The BB official said that the high net investment in the savings tools would continue this fiscal year if the government did not cut the rate on the savings tools. Former caretaker government adviser Mirza Azizul Islam told New Age on Wednesday that people had opted to invest in the savings tools as the interest rate on the deposit products offered by the banks was now equivalent to the inflation rate. In many cases, the rate on the banks products is below inflation rate resulting that people are making investment in the tools heavily in recent time, he said. The situation will not improve despite the government cut two-three per cent interest rate on the savings tools due to the much lower rate on the banks deposit products, he said. Against the backdrop, the government should stop selling the national savings certificates when its budgetary borrowing target will be fulfilled, he pointed out. Source: http://www.newagebd.net/article/19099/investment-in-savings-tools-crosses-tk-50000cr-in-fy17

MUHITH HINTS AT CHANGING FISCAL YEAR Finance minister AMA Muhith on Wednesday hinted at changing the fiscal year against the backdrop of demands by the economists for improving the implementation of the annual development programme. Although the finance minister always opposed any change in the fiscal year in the past, he dropped the hint at a meeting with officials of the Institute of Diploma Engineers at the secretariat. I was pretty convinced with the practice of the existing fiscal year that starts from July and concludes in June, he said. But the demand by the economists influenced the Muhith to change his position about the fiscal year. Some economists preferred the fiscal year to run from April to March, while others wanted that the fiscal year should start from January, he said. The minister wants a public debate on fixing the first month of fiscal year. Economists have been asking for changing the fiscal year to bring about improvement in the implementation of the ADP. They argued that the beginning of the existing fiscal year coincided with the rainy season created problems in project preparation and their implementation.

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Neighbouring India has announced recently that its fiscal year starting from April would be brought forward to start in January. Finance minister AMA Muhith on Wednesday hinted at changing the fiscal year against the backdrop of demands by the economists for improving the implementation of the annual development programme. Although the finance minister always opposed any change in the fiscal year in the past, he dropped the hint at a meeting with officials of the Institute of Diploma Engineers at the secretariat. I was pretty convinced with the practice of the existing fiscal year that starts from July and concludes in June, he said. But the demand by the economists influenced the Muhith to change his position about the fiscal year. Some economists preferred the fiscal year to run from April to March, while others wanted that the fiscal year should start from January, he said. The minister wants a public debate on fixing the first month of fiscal year. Economists have been asking for changing the fiscal year to bring about improvement in the implementation of the ADP. They argued that the beginning of the existing fiscal year coincided with the rainy season created problems in project preparation and their implementation. Neighbouring India has announced recently that its fiscal year starting from April would be brought forward to start in January. Source: http://www.newagebd.net/article/19098/muhith-hints-at-changing-fiscal-year

GOVT IN CRITICAL POSITION TO MAKE UP TK 20,000CR REVENUE SHORTFALL: MUHITH The government is in a critical position as the suspension of 15 cent uniform rate of value added tax would cause Tk 20,000 crore shortfall from the outset of the new fiscal year. Finance minister AMA Muhith on Wednesday gave the disclosure after a meeting of the cabinet committee on national purchases at the secretariat. The additional income of Tk 20,000 crore projected to be generated from VAT in the current fiscal year would not be possible, he said while talking to reporters. Lower than projected revenue generation and its way-outs have kept the national board of revenue officials busy at the onset of the fiscal year because of major changes in the fiscal measures announced on June 1 in parliament. The changes included suspension of 15 per cent uniform rate of VAT while passing the Finance Bill 2017 in parliament on June 28 because of non-cooperation by the business communities. Banking on the full implementation of the VAT and Supplementary Duty Law 2012, Muhith projected an ambitious revenue generation target of Tk 2,87,990 crore in the new fiscal year. He noted that making up the revenue shortfall would be very critical for the government. He, however, said he was holding meetings with the revenue officials to prepare an alternative plan against the backdrop of suspending the full implementation of the VAT and Supplementary Duty Law 2012. According to the finance ministry officials, changes made in the original budgetary proposal of the current fiscal year are unprecedented. In 2005, the government had changed duty structure of 3,000 imported products one-and-a-half months into the fiscal year 2005-06. Responding to a query whether alternative plans would be placed in parliament, he expressed his ignorance. He said he would discuss with the law minister soon to be sure whether the alternative plan would be placed in parliament or not. The finance minister said he would give statements about the alternative plan before the end of the current parliamentary session. Commenting on a question that 23 BB officials are involved in the Bangladesh Bank reserve heist in February 2016 by suspected hackers, Muhith said he did not know anything about such report from any local intelligence agency.

http://www.newagebd.net/article/19098/muhith-hints-at-changing-fiscal-year


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Commenting on another question about compensating the victims of July 1, 2016 extremist attack on a Gulshan caf in Dhaka, the finance minister said that he had already allocated fund for the purposes. Each of the 20 victims would be given Euro 15,000, said home minister Asaduzzaman on Sunday. The money would be given to the families of the victims, he said. Nine Italians, seven Japanese, three Bangladeshis and an Indian were killed in the attack on Holey Artisan caf. The government is in a critical position as the suspension of 15 cent uniform rate of value added tax would cause Tk 20,000 crore shortfall from the outset of the new fiscal year. Finance minister AMA Muhith on Wednesday gave the disclosure after a meeting of the cabinet committee on national purchases at the secretariat. The additional income of Tk 20,000 crore projected to be generated from VAT in the current fiscal year would not be possible, he said while talking to reporters. Lower than projected revenue generation and its way-outs have kept the national board of revenue officials busy at the onset of the fiscal year because of major changes in the fiscal measures announced on June 1 in parliament. The changes included suspension of 15 per cent uniform rate of VAT while passing the Finance Bill 2017 in parliament on June 28 because of non-cooperation by the business communities. Banking on the full implementation of the VAT and Supplementary Duty Law 2012, Muhith projected an ambitious revenue generation target of Tk 2,87,990 crore in the new fiscal year. He noted that making up the revenue shortfall would be very critical for the government. He, however, said he was holding meetings with the revenue officials to prepare an alternative plan against the backdrop of suspending the full implementation of the VAT and Supplementary Duty Law 2012. According to the finance ministry officials, changes made in the original budgetary proposal of the current fiscal year are unprecedented. In 2005, the government had changed duty structure of 3,000 imported products one-and-a-half months into the fiscal year 2005-06. Responding to a query whether alternative plans would be placed in parliament, he expressed his ignorance. He said he would discuss with the law minister soon to be sure whether the alternative plan would be placed in parliament or not. The finance minister said he would give statements about the alternative plan before the end of the current parliamentary session. Commenting on a question that 23 BB officials are involved in the Bangladesh Bank reserve heist in February 2016 by suspected hackers, Muhith said he did not know anything about such report from any local intelligence agency. Commenting on another question about compensating the victims of July 1, 2016 extremist attack on a Gulshan caf in Dhaka, the finance minister said that he had already allocated fund for the purposes. Each of the 20 victims would be given Euro 15,000, said home minister Asaduzzaman on Sunday. The money would be given to the families of the victims, he said. Nine Italians, seven Japanese, three Bangladeshis and an Indian were killed in the attack on Holey Artisan caf. Source: http://www.newagebd.net/article/19101/govt-in-critical-position-to-make-up-tk-20000cr-revenue-shortfall-muhith

5 LAKH TONNES OF CRUDE SALT TO BE IMPORTED The government on Wednesday said it would allow import of 5 lakh tonnes of crude salt to keep the supply and the price of the essential item stable in domestic market amid excessive price hike in the country. The price of good quality refined edible salt reached to Tk 38-Tk 40 in recent days following shortage of supply of crude salt. Commerce ministry, in a press release issued on the day, said that the government made the decision to ensure sufficient supply of the item in the market as salt production fell short of target in the country. The government will soon issue a statutory regulatory order in this connection and importers selected by the government will be able to import salt within few days after completing the procedures, it said.

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The government in last two years in two phases allowed import of 2.5 lakh tonnes of crude salt to meet the demand of edible salt in the country. Referring to the industries ministry data, commerce ministry said that salt production in the country fell short of target by 2.12 lakh tonnes in this year as production of the essential item was affected by cyclone Mora and rainfall. A total of 13.64 lakh tonnes of salt was produced in the country in the year against the annual demand of 15.76 lakh tonnes, it said. According to the countrys import policy, import of salt is banned and the ban will be temporarily relaxed to facilitate the import. The government on Wednesday said it would allow import of 5 lakh tonnes of crude salt to keep the supply and the price of the essential item stable in domestic market amid excessive price hike in the country. The price of good quality refined edible salt reached to Tk 38-Tk 40 in recent days following shortage of supply of crude salt. Commerce ministry, in a press release issued on the day, said that the government made the decision to ensure sufficient supply of the item in the market as salt production fell short of target in the country. The government will soon issue a statutory regulatory order in this connection and importers selected by the government will be able to import salt within few days after completing the procedures, it said. The government in last two years in two phases allowed import of 2.5 lakh tonnes of crude salt to meet the demand of edible salt in the country. Referring to the industries ministry data, commerce ministry said that salt production in the country fell short of target by 2.12 lakh tonnes in this year as production of the essential item was affected by cyclone Mora and rainfall. A total of 13.64 lakh tonnes of salt was produced in the country in the year against the annual demand of 15.76 lakh tonnes, it said. According to the countrys import policy, import of salt is banned and the ban will be temporarily relaxed to facilitate the import. Source: http://www.newagebd.net/article/19100/5-lakh-tonnes-of-crude-salt-to-be-imported

IDB APPROVES $95.24M LOAN FOR RURAL HOUSING PROJECT IN BANGLADESH Islamic Development Bank has recently approved a loan of $95.24 million for rural and peri-urban housing finance project in Bangladesh. The approval came at the banks 320th meeting held in Jeddah on Sunday. In the meeting, IDB approved a total of $1096.4 million for development projects for its member countries in various sectors such as power generation, water supply and sanitation, industry, housing, communications, agriculture and health as well as a number of educational and health projects for Muslim communities in non-member countries. Earlier on January 1, Finance Minister AMA Muhith approved a proposal from the Finance Division to take the loan from the IDB with a view to constructing multi-storied residential buildings in district towns for protecting crop land, said the ministry officials. According to the proposal, the government has to pay the loan at 3.25% interest rate within 15 years with a grace period of five years. IDB will lend the money to Bangladesh House Building Finance Corporation (HBFC) through the Finance Ministry. Contacted, HBFC Managing Director Debasish Chakrabarty told the Dhaka Tribune on Wednesday, HBFC would disburse the loan only to the borrowers living outside Dhaka and Chittagong metropolitan areas for construction of multi-storied residential buildings. He said under the project, a total of 1,046 buildings will be erected to accommodate 47,856 people. The loan would be disbursed under Pallima Scheme, a newly launched scheme of the corporation. Under the scheme, loans would be distributed to construct 4,050 units in rural areas, 2,825 units in peri-urban areas and 1,101 units for non-resident Bangladeshis (NRBs), said Debasish. He also said one could take loan at best Tk60 lakh while the interest would be 8.5%.

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We would take the house building culture to urban, peri-urban and even to those municipality areas which are not under the project. Debasish added that they would like to provide low-cost home financing for low-income rural people as part of project assistance. Source: http://www.dhakatribune.com/business/economy/2017/07/05/idb-approves-95-24m-loan-rural-housing-project-bangladesh/

PHARMA SECTOR TO GROW AT 15PC A YEAR: STUDY Bangladesh's pharmaceutical sector can grow at 15 percent for the next five years riding on the expanded domestic market as well as new export frontiers, according to a new research. It would be unsurprising if it takes a similar route to Indian pharmaceutical industry, said LR Global, an asset management firm, in its report on Bangladesh's pharmaceutical sector. In 20 years, the neighbouring country's pharmaceutical sector grew 30 times, according to the report. Presently, the pharma industry of Bangladesh meets 98 percent of the local demand and exports to more than 125 countries. Greater affluence among the poorest socio-economic group and a shift in disease profile are expected to drive the growth of healthcare expenditure in Bangladesh, it said. Bangladesh's disease profile is expected to change in two major ways: the rise of non-communicable diseases and a gradual move from acute to chronic diseases. The country's ageing population is increasing: by 2036 about 25 percent of the population will be over 50 years of age. Besides, drug purchasing power is likely to rise with sustained growth in income as Bangladesh advances into the league of middle income countries, according to the analysis. The industry also has growth opportunities in the international domain -- enough to emerge as the next thrust sector after garment. With backward integration, quality research and skilled human resources, Bangladesh's pharmaceutical industry can emerge as a world leader in producing off-patented generics medicine. Globally, healthcare providers are increasingly endorsing generic drugs and Bangladesh can capitalise on the trend to penetrate the markets in the US, Germany, France, the UK and Japan. Global generics were valued at $168 billion in 2013, and are expected to reach $380 billion by 2021. Emerging markets also hold promise for Bangladesh's exports: their spending for pharmaceutical products stood at $249 billion in 2015 and is expected to reach $345-$375 billion by 2020. While most of the emerging markets in the low and middle income countries are dominated by multinational pharmaceutical companies, Bangladeshi companies have the capacity to penetrate these markets. Since the beginning of the decade, the pharmaceutical industry in Bangladesh has experienced double-digit growth driven by large consumer base, improved health consciousness and a supportive regulatory framework. Two effective policies have accelerated the growth of the sector. One was the Drug Control Ordinance 1982, which banned foreign companies from selling imported pharmaceutical products in the country. The other was the relaxation of the World Trade Organisation's agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which permitted Bangladesh to reverse engineer patented generic drugs. The relaxation of TRIPS for least-developed countries has been extended to 2032. In fiscal 2015-16, the annual sales of pharmaceutical products stood at Tk 15,600 crore. This is a huge jump for the sector as the industry size was only Tk 170 crore in 1982. Exports of pharmaceutical products registered 14.6 percent growth in 2011-2016, while the industry is expected to log in receipts of $90.3 million for fiscal 2016-17.

http://www.dhakatribune.com/business/economy/2017/07/05/idb-approves-95-24m-loan-rural-housing-project-bangladesh/http://www.dhakatribune.com/business/economy/2017/07/05/idb-approves-95-24m-loan-rural-housing-project-bangladesh/


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In one sentence, the pharmaceutical sector is the most successful sector in Bangladesh, said Rizvi Ul Kabir, director for marketing of Beximco Pharmaceuticals, adding that it did not compromise on quality to get to its current position. In line with the growth of the market, everybody has invested in quality, lab equipment and human resources to raise the standard to international level, which enabled local firms to enter developed and highly regulated markets, he said. For instance, Beximco Pharma-ceuticals has already started exporting to the US, one of the most regulated drug markets in the world, from last year. It shipped Carvedilol, a prescription drug for hypertension. Bangladesh's pharmaceutical industry is dominated by local players. Square Pharmaceuticals leads the charge, commanding an 18.8 percent market share, followed by Incepta at 10.2 percent, Beximco 8.5 percent, Opsonin 5.6 percent, Renata 5.1 percent and Eskayef 4.5 percent, according to the study. Multinational companies such as Radiant, Sanofi and Novo Nordisk enjoy a 10.5 percent market share and are focused on some specialised products. At present, oncology drugs are imported but some of the local players like Renata and Acme have heavily invested in the segment, according to the analysis. Given the fact that local companies can manufacture quality products at affordable price, oncology segment will emerge as an attractive growth segment in future. Bangladesh, however, relies on imports for raw materials. More than 90 percent of Tk 4,700 crore worth of raw materials are imported every year. As a result, the industry is vulnerable to external shocks, according to the report. To address the issue, the government has started the process of constructing an active pharmaceutical ingredient industrial park in Munshiganj. At least half of the companies that got plots in the API park are expected to go into operation by 2018. Once the API park is completed, Bangladeshi companies would be able to source at least half of their raw materials from the complex, reducing reliance on imports, said a senior executive of a pharmaceutical company. The report said the park can open up the international API market to Bangladesh. Source: http://www.thedailystar.net/business/pharma-sector-grow-15pc-year-study-1429024

SALES OF SAVINGS TOOLS SURGE Higher returns on savings certificates continue to increase the government's interest payment burden, according to the data of the Directorate of the National Savings. Sales of saving instruments in the first 11 months of the just concluded fiscal year were 238 percent higher than the government's target for the entire year, latest data shows. A total of Tk 46,669 crore worth of savings certificates were sold in the July-May period against a target of Tk 19,610 crore for the fiscal year ended on June 30. Yet, the savers continue to rush for buying the tools speculating that the government may slash the interest rates in line with other market rates. The government raised Tk 33,689 crore from sales of different savings schemes in the previous fiscal year. Currently, savings instruments that mature in five years offer the highest 11.52 percent interest rate, whereas the average deposit rate in the banking sector now stands at around 5 percent only. Also, too much demand for savings schemes has forced the government to shy away from borrowing from the banking sector that costs only 2-7 percent, according to bankers. The government's borrowing from the banking system remains negative 16.2 percent year-on-year till May of 2016-17. The government's target to borrow from banks was nearly Tk 39,000 crore in 2016-17.

http://www.thedailystar.net/business/pharma-sector-grow-15pc-year-study-1429024


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Experts said the high interest rates on government savings certificates are deterring the development of a much-needed bond market and turning investors into savers in Bangladesh. Source: http://www.thedailystar.net/business/sales-savings-tools-surge-1428994

CREDIT GROWTH DIPS IN MAY AFTER FIVE MONTHS Private sector credit growth bucked its five month-long upward trend in May, declining 0.2 percentage points to 16 percent. There is nothing to worry about, said Syed Mahbubur Rahman, managing director of Dhaka Bank, adding that the demand for credit is on the rise thanks to the government's various infrastructure projects. Moreover, the banking sector's liquidity might shrink by the end of this year due to the government's request last month to channel about Tk 20,000 crore to private sector power plant projects to fast-track their implementation, he said. Banks also agreed to divert the funds as they are sitting on excess liquidity. The banking sector's liquidity declined 11.15 percent from December last year to Tk 111,910 crore in March due to growing credit growth, according to data from the central bank. The state banks are sitting on the highest amount of excess liquidity as their credit growth is significantly low due to lack of efficiency and default loans, said a senior executive of a state-owned bank. Of the total excess liquidity, about 57 percent, or Tk 63,460 crore, belongs to state banks. Private commercial banks have Tk 35,520 crore. Although the demand for credit is rising, the growth rate will remain within the monetary target of 16.5 percent set for June, said a senior executive of the central bank. MA Halim Chowdhury, managing director of Pubali Bank, attributed the fall in credit growth to the banks' increased emphasis on loan recovery instead of disbursement. Increased SME loan and consumer financing contributed mostly to the surge in credit growth in the last few months, said Mohammed Nurul Amin, managing director of Meghna Bank. SME loan disbursement increased about 22 percent to Tk 141,935 crore from a year earlier. As of December last year, consumer financing stood at Tk 55,971 crore, up 14.2 percent year-on-year. Consumer loan saw a faster growth due to the falling lending rate, said a senior official of a private bank. In April, the weighted average lending rate came down to 9.52 percent, according to data from the Bangladesh Bank. Industrial term loan registered a 9.8 percent year-on-year growth to Tk 19,575 crore in the October-December period of last year. Source: http://www.thedailystar.net/business/credit-growth-dips-may-after-five-months-1429003 ,

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http://www.thedailystar.net/business/sales-savings-tools-surge-1428994http://www.thedailystar.net/business/credit-growth-dips-may-after-five-months-1429003


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