file image.
Economic Reporter//

The flow of remittances in the country is booming. 254 crore 2 million dollars came in the month of June just ended. In June, the last month of the financial year, the country received the highest remittance in 47 months. Mainly on the occasion of Eid al-Adha, expatriates send large sums of money to the country. This is the highest remittance in the history of the country so far as a single month. According to the data of the Central Bank, in the financial year 2023-24, expatriate Bangladeshis sent remittances to the country equivalent to 23.91 billion (2 thousand 391 crore) dollars.

Earlier, in the financial year 2022-23, the remittance came to 21.61 billion (2 thousand 161 crore) dollars. Overall, the financial year 2023-24 saw the highest remittances in the last three years. The central bank says that due to various initiatives, remittances are increasing through legitimate channels. This trend will continue in the future. Meanwhile, Bangladesh Bank’s foreign exchange reserves have also increased based on remittances or expatriate income.

Bangladesh’s gross reserves stood at 27.15 billion dollars after receiving remittances and the third tranche of International Monetary Fund (IMF) loans of 1.15 billion dollars. And 22 billion dollars in BPM 6 method of IMF. Last May, gross reserves were 24.19 billion dollars. In other words, foreign exchange reserves have increased by three billion dollars in the last one month. Those concerned think that the relief in the economy has started to increase.
Bangladesh’s foreign exchange reserves reached a record high of $48 billion in 2021 amid the Corona pandemic. This success of Bangladesh appears as an example to many countries of the world. But due to economic stagnation in the pandemic and Russia-Ukraine war, the price of all kinds of products, including energy, has increased several times in the international market, which has a negative impact on Bangladesh as well. Reserves begin to decrease.

In June last year, the financial year ended with a gross reserve of 31.20 billion dollars. After that it gradually decreases. In November, it stood at 24.89 billion dollars. After that there was some increase in December but it started to decrease again from January. In May, it went down to the level of 10 years ago. Regarding the increase in reserves, Bangladesh Bank spokesperson and executive director Majbaul Haque told the media that even in the current situation, Bangladesh Bank is trying to increase remittances.

Banks are encouraging expatriates. Remittances are increasing. At the same time, money from the third tranche of the IMF loan and loan dollars from several other sources added to the reserves. Reserves have increased to 27.15 billion dollars.
According to the data of the Central Bank, in the fiscal year 2023-24, expatriate Bangladeshis sent remittances to the country equivalent to 23.91 billion (2 thousand 391 crore) dollars. Earlier, the remittances in the financial year 2021-22 were 21.61 billion dollars (2 thousand 161 crores). According to the financial year, the highest remittance came in the financial year 2020-21 of 2 thousand 477 million dollars. Overall, the financial year 2023-24 saw the highest remittances in the last three years.

The flow of remittances through banking channels has increased in the country in recent months. In May of the recent fiscal year, remittances or expatriate income of 225 million 38 million dollars came. According to that, 288.2 million dollars more came in June compared to May. And compared to the same month of last year, more than 34 million 3 million dollars came. Remittances of 2199 million dollars came in June last year. In April, May and June of the current financial year, remittances of more than 2 billion dollars came in these three consecutive months. Most of these remittances came to the country in June.

Expatriates sent home remittances of $254.2 million last month, the highest in nearly three years. Earlier in July 2020, expatriates sent a record 259 million 82 million dollars remittance to the country. This is the highest remittance in the country’s history so far as a single month. Officials of the concerned department of the central bank say that the difference between the bank rate and the informal channel has reduced in terms of dollars in remittances. Again, Bangladesh Bank is trying hard to increase remittance in the current situation. Banks are encouraging expatriates. Remittances are increasing. They said that it will increase in the future.

On the other hand, according to the data of the Central Bank, on June 26, the foreign currency reserve status of Bangladesh Bank was 24.62 billion dollars as gross. It was $19.47 billion as a gross of the IMF approved BPM6 system. Bangladesh Bank does not disclose the net account of reserves. It only informs various organizations including the IMF. Bangladesh seeks loan from IMF amid foreign currency supply crisis.

After several rounds of negotiations, the Washington-based financial institution approved a loan of 4.7 billion dollars on January 31 last year. After approving the loan agreement, Bangladesh received 476.2 million dollars of the first installment at the beginning of February last year. And on December 12, Bangladesh received 68 million 10 million dollars in the second installment. To receive the third tranche concession, the IMF has set a condition of maintaining net reserves of $14.76 billion at the end of June, which was $20.10 billion in the previous conditions.

Due to progress in other conditions, the international creditor organization gave this concession to the preservation of net reserves at the request of Bangladesh. According to the new conditions, the net reserve should be increased to 14.88 billion dollars by the end of September and 15.30 billion dollars by the end of December. Earlier, on May 8, the IMF delegation visiting Dhaka reached a consensus at the official level meeting on the release of the third installment.

The review mission held meetings with various government departments and Bangladesh Bank from April 24 to May 8 to review progress in terms and conditions of the second installment of the loan. Bangladesh has to go through several financial and policy reforms as a loan condition. Among these are market-oriented foreign currency exchange rates, removal of the 9 percent interest rate limit on bank loans, disclosure of information on risk-based assets of bank loans, disclosure of net account of reserves according to IMF accepted method BPM6, reduction of non-performing loans in the banking sector and development of the capital market.