Forex reserve falls by $1.5b

Special Correspondent: Bangladesh’s foreign exchange reserve fell by around $1.47 billion in a span of eight days. As a result, the country’s reserve has decreased to 2,171 million dollars.
The information has emerged in the weekly report of Bangladesh Bank on Thursday.
According to report of the central bank, foreign exchange reserve in the country stood at $21.71 billion as of September 13. On September 5, the figure of foreign exchange reserve was $23.18.
The country’s foreign exchange reserve has been falling for more than a year due to higher import payments and lower than expected export earnings and remittance inflows.
According to the concerned department of Bangladesh Bank, the foreign exchange reserves have declined mainly due to the payment of liabilities to the Asian Clearing Union (ACU). This liability is the import bill for July-August period this year. The reserve of the central bank has fallen to 2,171 million dollars due to the payment of the AKU bill in accordance with the IMF’s accounting method BPM 6. However, according to the accounting system of Bangladesh Bank, currently the reserve is 2,763 million dollars. Sources said, 1100 million dollars was paid last month against the AKU bill for the period of May-June. Imports in July and August were slightly higher and more than 5 percent interest rate was paid for the liabilities.
The Asian Clearing Union (ACU) is an inter-regional settlement system between central banks. The imports and exports between nine countries in Asia are settled through ACU every two months. However, Bangladesh’s transactions with other countries are completed immediately.
AKU member countries are Bangladesh, India, Iran, Nepal, Pakistan, Sri Lanka, Myanmar, Bhutan and Maldives.
Of these, Sri Lanka has been removed from this list recently due to failure to pay the debt. The central banks of the rest of the country have to pay the transaction amount every two months.
Among these countries, India receives more dollars from other countries than it remits. Most of the remaining countries spend more dollars than they earn.
Experts said that the goods imported from AKU countries, the banks deposit dollars to Bangladesh Bank every week considering its value. At the end of every two months, the central bank pays this liability on behalf of the banks. Then the reserve suddenly decreases.
Country’s imports fell by 15.81 percent in FY 2022-23. In that financial year, the cost of import was 7,506 million dollars. Before that, in the fiscal year 2021-22, a total of 8,916 million dollars were spent on imports.
In February last year, due to the Russia-Ukraine war, commodity prices rose in the global market. This increases import costs and creates a dollar crisis. After that, Bangladesh Bank imposed different conditions and strictures to reduce imports.
Meanwhile, the National Board of Revenue (NBR) imposed levies additional duty on imports. After that the import cost started to decrease.