The country’s trade deficit declined to $4.86 billion in the first nine months of the financial year 2012-13 from $6.75 billion recorded in the corresponding period of the FY 2011-12.
The trade deficit declined by 27.98 per cent in July-March of the FY 13 on year-on-year basis due mainly to negative import growth, said Bangladesh Bank officials.They said that the declining trend in trade deficit had not put any positive impact on the country’s macro-economic situation as the import of capital machinery and industrial raw materials decreased significantly in the first nine months.
‘Besides, the lower import growth has already created an unrest situation in the country’s money market as the US dollar is getting devaluated almost every day against the local currency taka’, said an official.
The BB data showed that import in July-March of this financial year registered a negative growth of 0.88 per cent to $24.22 billion from $24.43 billion during the same period of FY 2011-12.
On the other hand, the country’s exports increased by 9.48 per cent to $19.35 billion in July-March of this financial year from $17.68 billion in the first nine months of the FY 2011-12.
Under the circumstances, the trade deficit, the gap between export earning and import payment, decreased by 27.98 per cent to $4.86 billion in the first nine months of the financial year
against $6.75 billion in the same period of the FY 2011-12.
The reason for the reduced trade deficit was the massive drop in import payment, a BB official told New Age.
The BB data showed that growth in settlement of LCs for industrial raw materials and capital machinery had registered negative growth — 5.11 per cent for industrial raw materials and 18.09 per cent for capital machinery — in July-March of the FY 2012-13.
Growth in settlement of LCs for industrial raw materials was 12.73 per cent and that for capital machinery was 22.18 per cent in July-March of the FY 2011-12.
The capital machinery and the industrial raw materials are essential for growing economy like Bangladesh, the BB official said.
The recent political volatility in the country has created an unfriendly business environment to set up new industries resulting in a negative growth in capital machinery and industrial raw materials, he said.
The BB has already purchased money worth more than $4 billion from the local commercial banks in a bid to stabilise the money market, he said.
But, the greenback continued to depreciate against the taka frequently due to a sluggish demand for dollar against the backdrop of lower import growth.
The dollar was quoted at Tk 77.80 in the inter-bank forex market on Wednesday and Tk 77.83 on the previous day and it was quoted at Tk 79.75 to Tk 79.80 on January 1.
The BB data, however, showed that the service sector deficit in the first nine months of the FY 2012-13 increased by 6.83 per cent to $2.34 billion.
In July-March the FY 2012-13, the country received $2.04 billion from the service sector but it paid foreign sources $4.38 billion.
The narrowed trade deficit and an increased trend in inward remittance have further strengthened the country’s current account balance in the first nine months of the FY 2012-13, said another BB official.
The current account balance in July-March stood at $2,825 million against a negative figure of $120 million in the same period of the FY 2011-12, according to the BB data.
Net foreign direct investment increased by 10.88 per cent to $1,050 million in the July-March period of the ongoing financial year from $947 million in the same period of the FY 2011-12.
In the first nine months of this financial year, medium- and long-term loan also increased by 44.67 per cent to $1,399 million from $967 million in the corresponding period of the FY 2011-12.
-With New Age input
