On Tuesday, December 27, Bangladesh Bank decided to dismiss the board of directors of the Uttara Finance and Investments over major financial irregularities involving Tk 5,100 crore it had unearthed two years ago.  The Bangladesh Bank officials who are working on the issue commented the central bank has already completed all official procedures to dissolve the board in order to protect the interests of depositors. Within a day or two, Bangladesh Bank will send a letter to implement the decision, they said. Last month the central bank sent a letter to the Bangladesh Securities and Exchange Commission (BSEC) requesting it to provide a list of independent directors such that it could appoint them to replace directors in the non-bank financial institution (NBFI). An official related to Bangladesh Bank said the Bangladesh Securities and Exchange Commission has a panel of independent directors and it had earlier designated some of them in boards of directors of NBFIs which it had dissolved. In addition, the Uttara Finance and Investments is a listed company, which is why the central bank sought suggestions and a list of independent directors for the NBFI. The official said the BSEC has already provided the names to the central bank. On June 23, Central bank removed SM Shamsul Arefin, the managing director of the Uttara Finance and Investments, for his alleged involvement in the financial irregularities. What Happened in Uttara Finance and Investments? The BB carried out a probe in 2020 where it found that irregularities involving Tk 5,100 crore were committed by the board and management of the NBFI. The irregularities were perpetrated during the disbursement of loans and mobilisation of deposits. The bulk of the loans was given to different concerns of the Uttara Group of Industries. The majority of directors of the group also hold directorship at the NBFI. Most of the amount was not even shown in the NBFI's financial statement made public in 2019. For instance, it provided Tk 336 crore in loans to Uttara Motors and other concerns of the Uttara Group of Industries without any credit proposals, breaching banking rules. The BB found that Mujibur Rahman, a director of the NBFI and deputy managing director of different concerns of the group, was the key person behind the financial scams. In August 2020, the lender provided vouchers of term-deposit receipts (TDRs) of Tk 236 crore to Bluechip Securities, the managing director of which is Mujibur. But the vouchers of the TDRs were forged. In reality, the firm did not deposit any money with the NBFI, said the BB report. The NBFI also concealed the actual amount of term deposits mobilised from clients. Its financial statement mentioned that the total amount of term deposits was Tk 1,877 crore as of December 2019. But the BB discovered that the actual amount was Tk 2,603.20 crore. The undisclosed funds of the term deposits to the tune of Tk 726 crore was diverted to other sectors as a part of its effort to help scamsters plunder the money, said the BB probe report. The lender also employed the same tactic in the calculation of the loans disbursed in its financial statement. For instance, the total amount of loans provided by the NBFI was Tk 1,877 crore till December 2019 as per its balance sheet. But the BB found that the actual amount was Tk 3,802 crore. Contacted by The Daily Star yesterday, Matiur Rahman, vice chairman of the NBFI, said the board has not received any directive yet from the central bank about disbanding. "Some officials, including former managing director SM Shamsul Arefin, were involved in siphoning off funds from the non-bank," he said. "The NBFI will file a case against the alleged persons soon," he said. No other board member was involved in any irregularities in the NBFI, he added.  Source: The Daily Star

Contract Signing Ceremony For Project PMC Sercices For ‘Upgradation Of Mongla Port Project’ Being Financed Under GOI Concessional Lines Of Credit. The Project Management Consultancy (PMC) services contract for the ‘Upgradation of Mongla Port’ project was signed in Dhaka on 26 December 2022. The project is being financed under the Government of India concessional Line of Credit of USD 4.5 billion extended to the Government of Bangladesh.  The contract was signed between Mongla Port Authority and EGIS India Consulting Engineers Pvt. Ltd. The total project cost under Government of India concessional Line of Credit is USD 530 million of which PMC contract awarded to Egis India Consulting Engineers Ltd. is for USD 9.60 million. Hon’ble State Minister, Ministry of Shipping, Mr. Khalid Mahmud Chowdhury MP, was the Chief Guest for the event. High Commissioner of India to Bangladesh, Mr. Pranay Verma and Secretary, Ministry of Shipping, Mr. Md. Mostafa Kamal, attended the event as Special Guests.  High Commissioner Verma in his address highlighted that Bangladesh is India’s largest development partner, both in terms of value and number of projects. Nearly one fourth of India’s global development assistance is extended to various projects in Bangladesh, covering a variety of sectors. This robust development cooperation is a reflection of India’s commitment to partnering with Bangladesh in its journey towards greater growth and prosperity. He emphasised that various connectivity projects like the Mongla Port project, once completed, would have a transformational impact on not only India-Bangladesh economic relations but also on the economy of the entire sub-region.  Government of India has extended four concessional Lines of Credit to the Government of Bangladesh till date, worth USD 7.862 billion. Under the concessional loans, 42 projects have been taken up so far. Ofthese, 14 projects have already been completed and the remaining are in various stages of implementation. Over USD 2 billion worth of projects have been contracted and actual disbursements have crossed  USD 1 billion, significantly picking up pace despite the severe challenges presented by the pandemic.  The ‘Upgradation of Mongla Port’ project is the largest project in the Shipping/Ports sector which Government of India is financing under its concessional loans. The development of this port will strengthen maritime connectivity for Bangladesh, not just for the movement of goods with India but also with Bhutan and Nepal. India is also providing concessional financing for the Khulna-Mongla Port rail line project and the Khulna-Darsana rail line project and with the completion of these projects, Mongla Port would become the only port in Bangladesh with rail connectivity, making it a truly multi-modal hub and unlocking immense economic potential. 

Some would say you can never be too rich. But rising economic inequality is leading more people to think that's wrong. Some of us are too rich. There is a long list of economists, philosophers and leaders who have dealt with the redistribution of wealth over the centuries. Entire political systems have been built around the idea of equality and sharing. What is limitarianism? Economic limitarianism is a concept that explores the idea that no one should be excessively rich. It focuses on the harms and risks of having super-rich individuals. When discussing inequality, it doesn't look at the problems of poverty or raising the poor up out of poverty. Instead, it focuses on having too much. Putting an upper limit on how much wealth a single person can accumulate is not meant as a punishment. The idea is to encourage positive change for the economic system and population in general through social improvements. Besides that, at some point "surplus money" no longer adds to well-being or a flourishing life. A few million dollars ought to suffice in most cases. Limitarianism is not socialism or communism. It does not reject the accumulation of wealth, ownership of private property, or some level of social inequality. It simply says that having a lot is sometimes too much.   Currently, the theory does not break "too much" into concrete numbers. So there is no single point where it would step in and call out excessive wealth, like at $10 million (€10.2 million), $150 million or even $2 billion. Where did the idea come from? One academic in particular is behind economic limitarianism: Ingrid Robeyns, a Belgian theorist working at Utrecht University in the Netherlands. She researches and teaches in the philosophy department, focusing on ethics, political philosophy and social justice. She first presented the idea of limitarianism at a conference in 2012 but it took a few years for her first academic paper on the topic to appear. Since then she has been tirelessly talking about the issue, publishing papers and working on a book. The idea has generated different reactions across the globe. "In Europe, my experience is that the public shares many of the arguments for limitarianism. But in the US, it is an idea that is very far from discussions that are taking place in the mainstream debate," Robeyns told DW. "Part of the traditional American culture is the idea of the 'American dream' — the belief that everyone would have a chance to become very rich, if only one is dedicated enough." Every billionaire a policy failure? The theory is also much more than simply looking at income inequality. Morality is at the core of limitarianism. When is it morally or ethically necessary to intervene in a free market economic system for the benefit of society as a whole? Are wealthy individuals adding to society by investing in increased productivity or are they just speculating or bleeding businesses dry — or entire developing countries? Are 10 cars really that much better than two? "Some now use the slogan 'every billionaire is a policy failure.' I think that is right, but that even a situation in which some super-rich people have much less than a billion is morally and politically problematic," Robeyns said.  Overall, she argues that limitarianism is built on two main columns: protecting democracy and addressing urgent unmet needs or problems in society that require collective action, like climate change. Looking at political inequality, limitarianism worries that inequality can undermine democracy. The rich can use their money to influence politicians, hire lobbyists and get their agendas set into law. If that doesn't work, they can also influence public opinion by owning media outlets outright or funding think tanks. Great wealth can impair climate change action Economic limitarianism also assumes that a more equal distribution of wealth would lead to a better overall quality of life in the world. It could help those living in extreme poverty to flourish. "If you already have $10 million, it doesn't add much to your lifestyle if you get another 100,000 euros or dollars. But if you have no wealth at all, then any increase is significant" and means less hunger, fewer unheated houses and fewer children in poverty, according to Robeyns. It is not just about money though. Proponents of economic limitarianism say that the rich are a danger to the environment since they create enormous CO2 footprints. "The super-rich are disproportionately causing climate change because their material lifestyles are much more abundant and their investments ecologically harmful," Robeyns said. "One could therefore argue that it would be fair to use their excess money to address the climate crisis, rather than letting them get away to build luxury bunkers or villas on top of mountains to go and hide in, in case climate change gets out of hand and civil unrest breaks out." Taking some of those riches could help with climate adaptation. Governments could invest in systems to protect citizens from extreme weather. At the same time, they could build renewable energy capacity or better technology. Critique while the rich keep getting richer Some critics think that economic limitarianism does not go far enough. Companies should also be subject to limitarianism guidelines, they say. Still, other philosophers and economists strongly disagree with the idea of limiting wealth. They see no moral limit to riches earned or inherited. In fact, it is the chance to become rich that propels entrepreneurs to take risks, invent things and bring about change. Additionally, they argue that limiting wealth will not end political inequality. Measuring wealth or wellbeing is impossible and a better way to achieve more equality would be a progressive tax system. Yet make no mistake — the rich are getting richer. The 2022 list of billionaires put out by Forbes counted 2,668 of them. Together they were worth $12.7 trillion. It is a bit less than the previous year since the many global crises have taken a toll. Nonetheless, they "found more than 1,000 billionaires who are richer than they were a year ago." Can limits realistically be put on wealth? Robeyns sees the real-world problems with implementing her ideas. First, it is nearly impossible to come to a universal definition of how rich is too rich. Secondly, even if there were a defined amount, how would anyone go about actually collecting the surplus money? She finds consolation in the fact that philosophers are there to ask questions and not confiscate diamond necklaces or private jets. "Ideas can change history. Some do, some don't," Robeyns concluded. Her ideas may be unpopular in some corners, but at least they make people think about inequalities. "My role as a philosopher and scholar is to present those arguments, but it's up to citizens and leaders in the economic, political and religious domain to take the steps to realize such a world."

Bangladesh has made remarkable economic and development progress in the past five decades and now the country needs a strong reform agenda to sustain its growth trajectory and further accelerate the growth rate in the long term,, says a new World Bank report.  “The Country Economic Memorandum – Change of Fabric identifies” formally launched at a city hotel today (Thursday) identified key barriers to higher growth and proposed actionable reforms to maintain rapid growth.  The report urged strong policy reforms in three areas critical to sustain growth: stem the erosion of trade competitiveness, address vulnerabilities in the financial sector, and ensure orderly urbanization process.  Planning Minister MA Mannan spoke at the report launching ceremony as the chief guest while executive director of SANEM Prof Dr Selim Raihan and founder of SBK Tech Ventures and SBK Foundation Sonia Bashir Kabir spoke as panel discussants. World Bank acting country director Dandan Chen gave the opening remarks while Hoon S Soh, practice manager, macroeconomics, trade, investment and public sector, South Asia, World Bank gave the closing remarks. Nora Dihel, senior economist and Zahid Hussain, lead economist consultant, World Bank made a power-point presentation on the findings of the report.  Yutaka Yoshino, lead country economist for Bangladesh, moderated the programme. Speaking on the occasion, the Planning Minister said that Bangladesh is in the right path in terms of attaining GDP growth, attaining self sufficiency in food, reaching power connections to the doorsteps of people and increasing the literacy rate. “We can assure all that we’ll continue to strengthen our efforts to make more improvement,” he said. Turning to the issue of uncertainty and political instability, Mannan said that political instability could be there as clouds are gathering in the sky.  “But, we hope that the storm of black clouds will not come as it will be ominous for all …. it won’t work to find solution to problems with sticks,”  He also called upon all concerned stakeholders, including the political parties to shun the politics of violence and coming to the path of discussion with showing civilized behavior. Executive director of SANEM Dr Selim Raihan said that Bangladesh did much better compared to the other countries in keeping macroeconomic stability. The renowned economist also stressed the need for giving due importance on enhancing expenditure in social safety net programmes as well as in human capital, diversifying exports, bringing necessary reforms in the financial sector and mobilizing more domestic resources. The report also explored the implications of digital development and climate change as cross-cutting themes in these reform areas. “Over the past decade, Bangladesh has been among the top 10 fastest growing economies,” said Dandan Chen, World Bank acting country director for Bangladesh and Bhutan.  “But there is no room for complacency. New and emerging challenges—including, advances in technology and climate change—demand new policy and institutional innovations to cater to the changing needs of a growing economy. To achieve its vision of upper middle-income country by 2031, Bangladesh will need strong and transformative policy actions,” she added.  The report envisages export diversification to reduce the risk of export volatility, create new sources of growth, and increase foreign exchange earnings in the long term. The heavy reliance on ready-made garments and Bangladesh’s protective tariff regime inhibits diversified export growth.  Further, with trade competitiveness based on low wages and trade preferences eroding, the country can increase the resilience of economic growth by diversifying its export basket. Average tariffs in Bangladesh are higher than its comparator countries: the average tariff rate on intermediate goods in Bangladesh is 18.8 percent, which is about twice the rate as in China, Thailand and Vietnam.  Overall trade costs and inefficient border processes are major impediments to trade. Deep and comprehensive trade agreements with the European Union and India covering tariff modernization, increased trade facilitation, and services and invest reforms can respectively boost Bangladesh’s GDP by 0.4 and 0.5 percent and exports by 1.4 and 3.9 percent. Scaling up of private sector financing is essential for sustaining economic growth. Actions to improve asset quality, increase the capitalization of banks, and address increasing non-performing loans are urgently needed to maintain financial stability and accelerate credit growth.  Unlike Thailand, China and Vietnam, Bangladesh has an untapped domestic capital market, which is required for raising long-term finance, particularly for infrastructure and climate adaptation projects.  Unlocking private sector financing for green investments and climate risk financing will become increasingly important. The country also needs to focus on expanding access to finance in underserved segments, such as women and MSMEs.  The country also needs to source external resources proactively, including through international capital markets, by promoting local currency financing, easing external borrowing constraints, and attracting foreign direct investment. Although digitalization of payments has increased rapidly with 34 percent of adults using digital payments in 2017 in comparison to 7 percent of adults in 2014, about 40 percent of adults do not have a bank account. Strengthening credit infrastructure and promoting further digitalization of financial services will be important to reach the most underserved population.  “Greater Dhaka generates one-fifth of the country’s GDP and almost half of its formal employment. The already congested capital needs to be prepared to accommodate climate migrants,” said Nora Dihel, senior trade economist.  “Better urbanization and connectivity will help absorb the climate migrants and sustain fast productivity growth.  Successful urbanization will mean attracting tradable activities to small and medium-sized cities.” she added. This will require making the next tier of cities attractive to formal firms and skilled workers. Cities will need to raise their own revenues to finance infrastructure investments and provision of services, including affordable housing.  Faster broadband speeds, better access to basic services, and easier intercity transport connectivity can lead to tier-2 cities like Gazipur and Narayanganj to promote urban growth outside Dhaka.  Source: BSS AH

State Minister for Power, Energy and Mineral Resources Nasrul Hamid today said that the process of natural gas exploration and extraction will be continued on priority basis. “It is must be expanded in natural gas exploration and extraction work with realistic projects,” he said this while witnessing an agreement signing ceremony virtually as chief guest. Nasrul Hamid said that the projects taken by the ministry will have to be implemented with the stipulated timeframe. Sylhet Gas Fields Company Limited signed the deal with Sinopec International Petroleum Service Corporation, China, for land development and construction of civil works, supply of exploration materials, provide third party engineering services and carrying out all digging activities on turn-key basis.  The project was taken by Gas Development Fund and Sylhet Gas Fields Company Limited with its own financing. The state minister said whatever quantity of gas comes from the walkover or exploration wells will contribute a lot to the national development. Authorities expected that around 10 million cubic feet of gas will be produced from the well per day, according to the project details. Among others, additional secretary of energy division SM Zakir Hossain, Petrobangla Chairman Nazmul Ahsan and Sylhet Gas Fields Limited Managing Director Md Mizanur Rahman were present at the signing ceremony. Source: BSS AH