‘Adverse effect of forex gain in mind’
Abdur Rahim Harmachi,
Published: 2013-01-25 05:14:58.0 BdST Updated: 2013-01-25 05:14:58.0 BdST
Finance Minister AMA Muhith expressed satisfaction at the forex reserve level that tipped the $ 13 billion mark for the second time this year, but at the same time he said he has to consider the adverse impacts of i toot.
On Thursday, the forex reserve stood at $ 13.06 billion. Earlier on Jan 7, the forex reserve stood at $ 13.12 billion – topping all other previous records of Bangladesh.
The Minister was speaking to bdnews24.com at his office at the secretariat. If forex reserve increases, donors do not send aids, he said.
“You are well off, what is the need for aids? They will say then,” said Muhith.
According to him, the reserve is satisfactory leaning on the remittance sent in by expatriate Bangladeshis.
He said an increase in remittance or reserve led to inflation – which the government was trying to keep within limits through the monetary policy of the Bangladesh Bank.
On questions whether the reserve would be employed in investment, Muhith responded positive. “Yes of course… Just wait and see.”
The Minister said not only remittance, but revenue, export, manpower export, foreign aids and foreign investments were at satisfactory levels.
He complained that media in Bangladesh were misers in praising Bangladesh, whereas in foreign countries Bangladesh is praised almost regularly.
On Wednesday, Prime Minister Sheikh Hasina announced that work of the Padma Bridge will begin with optional funding if World Bank does not agree to comply within the current month.
If this happens, then foreign currency would be required to build the Padma project.
Earlier when the WB had halted its funds, the Prime Minister had spoken of bridging the Padma with own funds.
Bangladesh Bank Governor Atiur Rahman then had said that foreign currency will be provided from reserve for the sake of Bangladesh’s economy.
On forex topping $ 13 billion mark for second time this month, Bangladesh Bank Forex Reserve and Treasury and Management division General Manager Kazi Saidur Rahman told bdnews24.com it was possible due to the positive flow of remittance.
“Besides, as the price for Dollar has come down, exporters are quickly bringing in their payment. This has contributed to a rise in the flow of foreign currency,” he said.
The official added that decreased export costs and a rise in project aid disbursement had also contributed.
The forex reserve that was $ 13.12 billion in the first week of January, came down to $ 12.63 billion after clearing import bills of Asian Clearing Union (ACU). It again rose within 17 days due to the positive inflow of remittance.
In Jul-Dec of 2012-13 fiscal, remittance increased 22 percent from last year.
Within the same time, export revenue gained 7 percent and from Jul-Nov import costs decreased by 6.88 percent.
However, during Jul-Nov foreign aids increased by 107 percent.
On Thursday, a Dollar was traded for Tk 79.30. In January last year, its price was almost Tk 85.
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