Weekly News Clippings (June 21, 2014)

62pc rise in Swiss bank deposits (The Daily Star, June 21, 2014)
Deposits by Bangladeshi citizens at various Swiss banks rose by 62 percent year-on-year in 2013, mainly due to political unrest and lack of safety throughout the year when many predicted a government changeover. The deposits that stood at Tk 3,236 crore (372 million Swiss franc) at the year end were Tk 1,991 crore in 2012, according to the latest data of Swiss National Bank (SNB), the country's central bank. In contrast, the money held in Swiss banks by foreign clients from across the world continued to decline and stood at a record low of 1.32 trillion Swiss francs (about $1.56 trillion) at the end of 2013.

WB's $600m loan for rural power supply (The Daily Star, June 20, 2014)
The World Bank has lent Bangladesh $600 million to help the country construct new power lines and substations, and upgrade existing lines, in an effort to ensure reliable power for 25 million rural consumers. The 40-year credit facility will come at an interest rate of 0.75 percent with a 10-year grace period. The project will aim to reduce system losses and enhance the capacity of the rural electricity network in the Dhaka, Chittagong and Sylhet divisions.

Stop anti-formalin drive (The Daily Star, June 20, 2014)
Mango traders and growers of Chapainawabganj, Rajshahi have extended their support to retail fruit traders of the capital protesting the ongoing drive against adulterated fruit, launched on June 11 which has stirred a controversy surrounding the device being used to detect adulteration. Mango growers threatened to enforce a hartal in Chapainawabganj district on Sunday if law enforcers do not stop the drive. As many as 100 trucks of mangoes valued at Tk 30 crore have so far been destroyed across the country and a number of mango traders have been fined and jailed, fruit vendors said. The protesters also accused the police of taking bribes.

Nepal to give duty-free access for 74 Bangladeshi items (New Age, June 19, 2014)

Nepal would be giving duty- free access to 74 Bangladeshi products to reciprocate to Bangladesh’s agreement to grant zero-tariff entry to 108 Nepali items. Bangladesh had also proposed that Nepal should allow market access of its pharmaceuticals, garments, agro-processed food items, refrigerators and other electronics home appliances. The 108 Nepali goods short listed by Bangladesh for preferential treatment include lentil, vegetables, cereal, wheat flour, fruit, juice, dairy and handmade paper. 

Legal flaw fails to stop formalin use in food (New Age, June 19, 2014)

The safe food law names formaldehyde as only formalin without mentioning its generic and commercial tags, creating problems in checking its use in food items such as fruit, vegetables, fish and milk which can be toxic in high amounts. The chemical, commercially known as formalin and formol, which is often used to preserve fruit, vegetables, fish and milk, is imported into Bangladesh in many other names such as methanal, methyl aldehyde, paraformaldehyde, polyoxymethylene, paraform, formagene and morbicid acid. Experts said that as the Safe Food Act 2013 does not name the variants, it becomes tough for authorities to check against formalin use in food. 

Bangladesh, Chinese company sign US$1.6bn bridge deal (Turkish Press, June 18, 2014)

Bangladesh has finally sealed a construction deal for its long-running Padma bridge project, after signing a deal with a Chinese state-owned firm on Tuesday. The 6 km long bridge is set to cost Tk. 121.32 billion (US$1.56 billion), which is Tk. 30 billion more than costs projected in 2011. The Chinese firm, China Major Bridge Engineering Company Limited, will be responsible for building the main infrastructure for the bridge and have it ready to open by 2018. 

Bird flu 'danger zones' mapped (BBC, June 17, 2014)

A study, published in Nature Communications, showed parts of Bangladesh, India and Vietnam could easily sustain the deadly bird flu virus. Scientists have mapped the “danger zones” in Asia which are vulnerable to the virus, called H7N9, has infected 433 people mostly in China and has killed 62. The research group said those areas should monitor poultry to ensure any threat is detected. Bangladesh, northern India, the Mekong and Red River deltas in Vietnam and isolated parts of Indonesia and Philippines were identified as at-risk areas.

High tax looms over luxury cars (The Daily Star, June 17, 2014)

The revenue authority is set to slap higher advance tax for owners of luxury cars in the upcoming fiscal year in an attempt to meet the steep revenue target. A new tax slab will be introduced for vehicles above 3,500CC, which are typically luxury cars or sports utility vehicles, said a senior official of the National Board of Revenue. A tax of Tk 1.25 lakh will be imposed during registration or fitness renewals at the Bangladesh Road Transport Authority (BRTA), which would be adjustable with total income tax. At present, owners of vehicles above 2,800CC are subjected to a Tk 1 lakh advance tax. The move comes at a time when the sightings of high-end vehicles are on the rise. 

Forex reserve crosses $21bn mark (Dhaka Tribune, June 17, 2014)

The country’s foreign exchange reserve has crossed $21bn yesterday thanks to increased inflow of foreign funds mainly due to the local currency’s becoming stronger against dollar. It would be enough to meet as many as seven months of import payments as it reached the new high in only two months from $20bn-mark as of April 10. The reserve was $18bn in December last year. Despite slow growth in foreign remittance and imports accelerating lately ahead of Ramadan, the forex reserve reached the new high due to allowing short-term foreign financing in the private sector, said a senior executive of Bangladesh Bank. 

Invest more in infrastructures (Dhaka Tribune, June 16, 2014)

Asian Development Bank President Takehiko Nakao has urged Bangladesh to invest more in infrastructure development to become a middle income country. It spends only 3% of GDP on infrastructure, he said at a press conference at ADB’s Bangladesh Resident Mission in Dhaka. He discussed with government officials about reform in value added tax and stronger enforcement administration of tax collection. He also emphasized on the need for skills development and business climate improvement as the country targets middle-income status.

Condition imposed on formalin import (Dhaka Tribune, June 16, 2014)

The Ministry of Commerce yesterday imposed tougher conditions on the import and use of formalin. Now, the importers must apply with recommendations from respective ministries and the retailers must keep registered records of the formalin buyers. The conditions have been imposed through a gazette notification issued on 14 March last year.

Wealth tax: need of the hour (The Daily Star, June 15, 2014)

A top government functionary yesterday called for imposition of wealth tax to discourage accumulation of unproductive assets. Planning Minister AHM Mustafa Kamal at a dialogue on an analysis of the proposed budget, organised by the Centre for Policy Dialogue,  also mentioned the issue of black money, saying it is generated through concealment of the real transaction value of land. Kamal cited the high land-value in Gulshan and Banani areas as a case in point. In practice, the real transaction value of land in those areas is not disclosed in the registration papers; a much lower figure is quoted to avoid tax. Discussants at the programme said the economy is unlikely to get a momentum without any improvement in the political atmosphere, governance and infrastructure.