The country's foreign exchange (Forex) reserves touched a new record, thanks to the upward trend of remittance, exports and foreign assistance as well as lower import payments.
The country's forex reserve crossed $48 billion for the first time to stand at $46.04 billion, according to Bangladesh Bank (BB) latest data published on Tuesday.
As a result, the forex reserves increased by almost $9 billion on Tuesday from $39.04 billion in the same time of the last fiscal year (FY-2020-21).
Dr Atiur Rahman, former Bangladesh Bank governor, told Bangladesh Post, “Record growth of remittance inflows, moderate export earnings and foreign assistance from development partners like World Bank (WB) and Asian Development Bank (ADB) as well as low import expenditure mainly helped increase the reserves.”
Rising reserves helped to develop different mega infrastructure projects like Padma Bridge as a financial support, he mentioned.
On the other hand, Bangladesh Bank becomes a development bank as the central bank made different development funds from forex reserves such as export development fund, green fund and investment development fund, which helped boost the country’s economy.
Within 14 months, the reserves increased by almost $10 billion, the forex reserves crossed $34 billion, $35 billion, $36 billion, $37 billion, $38 billion, $39 billion, $40 billion, $41 billion, $42 billion, $43 billion, $44 billion, $45 billion, $46 billion and $48 billion-mark for the first time respectively, according to central bank data.
The previous highest reserves amounting to $33.68 billion was recorded on September 5, 2017.
Bankers said the government has taken time-befitting initiatives to maintain healthy reserves.
The reserves are adequate to cover about 10 months’ import payment for the country of 160 million people, they said.
Despite worsening Covid-19 pandemic situation around the world, remittance inflow in the country hit a record growth to touch a new milestone and will cross $24 billion to stand at $24.77 billion for the first time in the fiscal year 2020-21, which pushed the forex reserves up, experts said.
An official of Bangladesh Bank mentioned that Bangladesh's foreign exchange reserve hit a record high of $48 billion after managing a financial support from the International Monetary Fund (IMF).
The Washington-based multilateral lender Tuesday provided $1.44 billion to Bangladesh under the special drawing rights (SDR).
The SDR is an international reserve asset created by the IMF to supplement the official reserves of its member countries, he said.
On the other hand, initiatives were taken by the government timely at various times which apparently resulted in an increased awareness among the expatriate workers to send their hard-earned money through legal channels, pushing up the remittance inflow.
Besides, the higher growth of remittance inflow is attributed to a budget announcement of 2 percent incentive to remitters on inward remittance for the last fiscal year.
On the other hand, another BB senior official said that higher gold prices in the global market as well as lower import bills have helped increase the country's forex reserves recently.
The government expressed the hope that the forex reserves will reach $50 billion by 2021.