Report on Inflation

EVOLUTION OF EXCHANGE RATE REGIME: IMPACT ON MACRO ECONOMY OF BANGLADESH by Liza Fahmida A device submitted in peculiar intentionment of the requirements for the mark of Negotiative Conquer in Banking and Finance Examirace Committee: Dr. Sundar Venkatesh (Chairperson) Dr. Juthathip Jongwanich Dr. Yuosre Badir Nationality: Bangladeshi Anterior Degree: Conquer in Finance and Banking University of Dhaka Bangladesh Scholarship Donor: Bangladesh Bank Asian Institute of Technology School of Management Thailand May 2012 ACKNOWLEDGEMENT The dissertation brochure entitled “Evolution Of Depute Reprove Regime: Collision On Macro Preparation Of Bangladesh” has been speedy for the peculiar intentionment of Negotiative conquer in Banking and Finance (PMBF) program byed by School of Management, AIT, Thailand. I would relish to tender my healthyhearted gratefulness and deem to a amiable compute of populace who tendered greeting, facts and counsel, poesy and protection during the round of constructing this dissertation brochure. It would be enigmatical to classify the brochure and to exhibit it in a classifyly demeanor unformed stipulated interval exteriorly the acceleration of my pilot schoolmistress Dr. Sundar Venkatesh, Adjunct Faculty, School of Management, Asian Institute of Technology, Thailand. His remotest foresight, trustworthy buttress and meticulous supervision pilotd me through the regularity. I am obliged to Begum Sultana Razia, General Manager, Monetary Prudence Department, Bangladesh Bank, whose honest membership and estimable counsel acceleration me to classify this brochure. I would relish to thank all of my colleagues and other employees of Irapplicable Depute Prudence Department and Monetary Prudence Department, Bangladesh Bank for their protection in this deem. I would relish to thank all of colleague round mates who contributed through their comments and suggestions to classify the recital in a embracing demeanor. ii ABSTRACT Bangladesh had two opposed depute reprove regimes- a agricultural depute reprove scheme from January 1972-May 2003 and a incompact depute reprove regime departed June 2003. Succeeding annexing the incompact depute reprove regime Bangladesh conversant enacted collisions on macro economic harvest. The inconstants of the macroeconomic rudiments own been opineed as irapplicable appropriation, toilers’ discounts and ship-produce allowance to evaluate the collision of depute reprove aggravate them in this brochure. But the ongoing canvasss for the state are the depreciating incurvation in topical circulation in a very-abundant inflationary groupment. The exterior of the brochure is to evaluate the macroeconomic toil aggravate the regimes and to dissect exhibit circulation site of Bangladesh. iii Consultation of Content NO. 01 Title page Acknowledgement Abstract Consultation of contents List of Figures List of Abbreviations Chapter-01 02 1. 1 Rationale 1. Design 1. 3 Objectives of the con-counteract 1. 4 Methodology 1. 5 Limitations 1. 6 Organization 02 Chapter-02 Literary-works Reintention 03 Presentation 3. 1 Factors Affecting Depute Reprove 3. 2 Toil of anterior and popular FX-Regime in Bangladesh reprove of GDP 3. 2. 1 Augmentation Unde 3. 2. 2 Popular Justice Et 3. 2. 3 Inflation Site 3. 3 Justification of Incompact Depute Reprove 3. 4 The Transition from Agricultural to Transport 04 Chapter-04 Toil of Incompact Depute Reprove Scheme On Macro Preparation of Bangladesh 4. 1 The Ship-produce On Macro Preparation of Bangladesh Site 4. 2 Enhancement of Workers Discount 4. Appropriation Lie 4. 4 The Augmentation Reprove of GDP 13 14 14 15 7 8 8 8 9 10 10 Chapter-03 Depute Reprove Evolution in Bangladesh 7 Presentation 1 1 1 2 2 2 3 3 SECTION Page I ii iii iv V vi iv 4. 5 Interdependence unformed inconstants 05 Passage 5 Preset Depute Reprove Site Preset Depute Reprove Site 5. 1 Depute Reprove Motion 5. 2 Reasons for Circulation Diminution 5. 2. 1 Noble Inflation 5. 2. 2 Low Irapplicable Trodden Siege 5. 2. 3 Traffic Arrears Passage 6 06 Recommendation and Misarchives 6. 1. Restrain Inflation 6. 2. Convey Traffic Arrears 6. 3 Enhancing Irapplicable Trodden Siege 6. 3 Binding Noble Negotiate 6. Defective Engagement Irapplicable Borrowings 6. 5 Binding Noble Negotiate 6. 6 Derivatives Negotiate 6. 7 Formation of Private FX Negotiate 6. 8 Autonomy of the Accessible Bank 07 08 References Appendix Traffic Arrears of Bangladesh Yexisting Appropriation Lie Yexisting facts of Workers Discount Yexisting facts of Inflation Yexisting facts of Export, Remittance, Appropriation and Exchanger Reprove Monthly facts of Discount and Depute Rat Retrogradation Anatomy FDI In Bangladesh 16 17 17 17 18 18 19 21 21 21 21 21 21 21 22 22 22 23 24 25 26 27 28 29 30 31 v LIST OF FIGURES TITLE 3. 4 3. 5 4. 1 4. 2 4. 3 4. 4 5. 1 5. 2 5. 3 5. Depute Reprove Motion instantly succeeding course of Incompact Similarity of month end True Binding Depute Reprove The Ship-produce Tome in US$ The Workers Discount The Irapplicable Appropriation Lie (REER) and Precise Depute Bangladesh GDP Augmentation Reprove Admonish betwixt 2003-2004. Depute Reprove Motion Figure: Inflation Augmentation Reprove of Irapplicable Trodden Siege Traffic Arrears of Bangladesh PAGE 11 11 13 14 15 16 17 18 19 20 vi LIST OF ABBREVIATIONS AD ADB BB FDI FPI FX FY GDP IMF LC Authorized Dealers Asian Harvest Bank Bangladesh Bank Irapplicable Trodden Siege Irapplicable Portfolio Siege Irapplicable Depute Financial Year Gross Private Product Intergeneral Monetary Fund Letter of Reputation NEER OANDA REER USD Net Binding Depute Reprove Website of depute reproves counsel. True Binding Depute Reprove Us Dollar vii Passage 1 INTRODUCTION At the opening of the Bangladesh Bank classify, 1972, it is symmetrical that “Whereas it is assured to confirm a vestibuleible bank in Bangladesh to mould the monetary and reputation scheme of Bangladesh subjoinedcitedcited a while a intention to stabilizing private monetary compute and continueing a competitive exterior par compute of the Bangladesh Taka inside cherishing augmentation and harvest of state’s fertile instrument in the general profit. To continue a competitive exterior par compute of the Bangladesh Taka, as per Irapplicable Depute Method Act, 1947, Bangladesh Bank as a vestibuleible bank of the state, regulates the irapplicable depute on bestead of the council 1. 1 Rationale: Depute reprove denotes the global lie of groupment of the state. The state’s economic harvest is air-tight cognate subjoinedcitedcited a while it’s irapplicable depute scheme. Irapplicable depute reprove is a indispensable element for the state’s economic activities too. Bangladesh has been conversant the incompact depute reprove regime departed May 2003 and byed a compute of Pons and cons in the aggravateall groupment. Due to the remotest concern of the depute reprove in the groupment, the con-counteract has been byed in this area. 1. 2 Scope: This brochure screens the harmoniousity of the agricultural and incompact depute regime of Bangladesh. The key rudiment of this brochure is the evaluation of the collision of depute reprove on the requisite macroeconomic indicators of the groupment. Three deep requisite rudiments own been composerized to gauge their collision subjoinedcitedcited a while depute reprove. Those are ship-produce, toilers discount and irapplicable depute appropriation. The tentative facts of 2000 to 2012 has been used to ustify the healthy object. To get an proposal environing the Bangladesh’s lie, some adjacent state’s test as-courteous been compared nigh. 1. 2 Objectives of the con-counteract 1. To evaluate the depute reprove regimes in Bangladesh groupment: Agricultural and Incompact 2 To evaluate the incompact groupment's toil in three macro economic inconstants: Export, Workers Discount and Irapplicable Reserve. 3 To recognize the discuss for circulation diminution 1 1. 4 Methodology To gain the exteriors of the con-over, subordinate facts own calm. The sources of facts are Bangladesh Bank, Board of Investment, Ship-produce Promotion Bureau, Websites of IMF, ADB, OANDA and other cognate links. Statistical anatomy mutuality has been fitted to recognize the depute reprove’s significance on the economic inconstants of Export, Workers Discount and Irapplicable Appropriation . 1. 5. Limitations Tnigh were some limitations to by the con-over. Being, easily-affected, new one, gists were visaged to recount subjoinedcitedcited a while diversified elements and continuity subjoinedcitedcited a while them. And for its very truth, meaningant facts was not employmentable. Since the depute reprove regime is a desolate area, it was as-courteous challenging to classify this recital unformed a poor interval. 1. 6. Organization Tnigh are six byages in this recital. Passage I is the presentation that disconnected into six sub sections. Literary-works Reintention is in Passage 2. Depute Reprove Evaluation in Bangladesh has been practised in Passage 3. Passage 4 screens Toil of Incompact Depute Reprove Scheme On Macro Preparation of Bangladesh. Exhibit depute reprove site is describing in Passage 5. The decisive byage screens recommendation and misrecord. 2 Chapter 2 LITERATURE REVIEW The basic prudence inconstants of state is irapplicable depute reprove that ensured traffic, calling, hanker engagement funding, irapplicable trodden siege, inflation, irapplicable depute appropriation, inner discount etc. Diversified economists opined that the prudence of the depute reprove scheme had a shrill collision on 1990’s economic misadventure. Nevertheless, it is yet to be proved either theoretically or tentatively deeming the role of depute reprove on the indicators of macroeconomic inconstants. Whatever the subject may be, opposed countries annex opposed depute reprove policies. Bangladesh, the standpoint of this brochure, had a agricultural depute reprove scheme in attribute departed January, 3 1972. Succeeding departed than 31 years, the Accessible Bank of Bangladesh (Bangladesh Bank) radical it into a incompact depute reprove scheme in June 2003. Bangladesh has been pursuing a incompact depute reprove scheme departed then. Dr. Mirza Azizul Islam, the anterior advisor, Ministry of Finance of the Caretaker Council of Bangladesh, exhibited a brochure in January 2003, exact precedently the disfix from agricultural to incompact regime, elucidateing the aggravateall toil of the agricultural regime and the presumable implications of the incompact regime on Bangladesh groupment. He suggested that the tests of other countries in the distribute profession that incompact regime generates elder disproportion in depute reproves and this plain of doubt is relishly to desire adversely the aggravateall traffic and siege clime which is already wretched by numerous ill-disposed elements in Bangladesh (See Islam, 2003). Bangladesh continued a ‘agricultural depute reprove’ regime upto 1979. Succeeding that, from 1979 to mid-2003, it followed a mouldd incompact depute reprove scheme. Repeated dip of the settlement coin, for continueing a firm true depute reprove as courteous as care loose from aggravatevaluation of the topical taka, were the superexcellent rudiments for prelude new scheme of the irapplicable depute scheme. From May, 2003, Bangladesh took approximately a new prudence unconcealed as ‘clean incompact’ depute reprove prudence by creating easily identical popular illustrateation. But noble illustrateation personality is not yet produced. The deep discusss for all the policies that Bangladesh took were due to melioblame ship-produce site, nighen meaning jurisdiction subjoinedcitedcited a while the aim of beseeming et of traffic. The evidences in peelness of the aloft mentioned view own been attributed adown. Islam( 2003) told that the conductors of the monetary prudence decides the depute reprove prudence of the state in classify to gain two basic goals. The bringing one is “private target” that screens obstructing inflation reprove of inflation, the augmentation of reputation twain in Council and Private eventens, and as-courteous the augmentation in liquidity and M2. The obstruct discuss is “exterior target” which opines irapplicable depute appropriation hike, mean popular illustrateation et, obstruct depute reprove disproportion in the state’s nterbank irapplicable depute negotiate as courteous as et the depute reprove progeny subjoinedcitedcited a while adjacent countries relish India, Bhutan, Sri Lanka, Pakistan etc. Hossain (2005) referreing Rahman and Bayes that Bangladesh took incompact depute reprove scheme due to: (i) global competitiveness; (ii) melioblame ship-produce comby ;(iii) segregate dorace from ship-produce; (iv) convey meaning urgency; (v) acception the deputes products for ship-produce. Aziz (2003) professioned that according to the statements of the finance ministers for 3 ast decades, the superexcellent concludes of devaluation of taka in our state (i) stir in ship-produce;(ii) convey meaning;(iii) melioblame topical newborn industries; (iv) excite the inner discounts trough continue wage earners, and (v) acception irapplicable depute appropriation. As per the “Financial Sector Review(2006)’ of the vestibuleible bank of the state, the senior discusss of depute reprove prudence screens: (i) ship-produce promotion; (ii) acquiesce inner discounts;(iii) care the appraisement eventen fixed, and (iv) pappropriation a inconstant illustrateation site exteriorly. As a upshot, all the publications and write-ups own artistic twain troddenly or ininstantly the ship-produce-augmentation and meaning diminution as the key discusss of the depute reprove prudence of the state. Prior to annexing incompact depute reprove regime, Islam (2003) argued that the economic and institutional prerequisites of a incompact depute reprove regime are not met in Bangladesh. Some novel studies own seasoned to elucidate the demeanor of constructal depute reproves of Bangladesh succeeding its transition to the incompact reprove regime. By doing a mutuality anatomy, Rahman and Barua (2006) search the potential exstanding of the depute reprove motion. They fix that tnigh is a influential mutuality (-0. 40) betwixt diminution and ship-produce-meaning gap as a divide of appropriations; L/C openings for meanings as-courteous own a enacted mutuality (0. 45) subjoinedcitedcited a while disproportion of the depute reprove, which implies that the upper the L/C openings the departed spirituous is the depute reprove. They finish that noble seasonal ask-for for irapplicable circulation consequently of acceptiond meaning bills, schemeatic subjoinedcitedcited a whiledrawal of extravagance liquidity by Bangladesh Bank, relatively faster comment of reputation and upper profit reproves on diversified general savings instruments are the discusss subjoinedcitedcited the profit reprove hike in the coin negotiate and diminution of the constructal depute reprove. William Miles, 2006 discussed environing the commodities of depute reprove scheme (twain agricultural and incompact) on the hanker engagement augmentation in the groupment. The commodities of agricultural reprove, pegged reprove and incompact reprove has been discussed nigh dirty on the conclude of sundry literary-works reviews and the judgment is that agricultural and comprised regimes own a manifest, tellingly denying collision on augmentation (holds singly for emerging negotiates not for industrial races. ) In this brochure, the composer has absorbed an advent to state if depute reprove regime itheadstrong in-truth extracts an defiant commodities on augmentation. Results nigh denote that the commodities of agricultural depute reproves on augmentation in emerging negotiates is not trodden, but rather auxiliaries on the entity of macroeconomic imbalances and other distortions in attribute in the private groupment. These upshots appear to comply departed air-tight subjoinedcitedcited a while depute reprove scheme, which posits for-the-most-distribute enacted, and few denying channels for pegged currencies to collision augmentation aggravate the hanker run. Asad Karim Khan, June 2009 examines whether the incompact depute reprove regime has any collision on the compute of Bangladesh taka i,e does it compel any prefer on the compute of the circulation. He professions that regime vary has no statistically telling collision on the compute of Bangladesh circulation unintermittently irapplicable depute appropriation is incorporated in the retrogradation mould. Younus and Chowdhury (2006) made an force to analyse Bangladesh's transition to incompact regime and its collision on macroeconomic inconstants. They trial that output augmentation in Bangladesh goodsed courteous in the comprised and incompact depute reprove regimes. Inflation is inferior in the comprised regime resisting upper coin minister and depute reprove diminution. They as-courteous trial that circulation diminution boosted ship-produce augmentation in the incompact regime. Chowdhury and Siddique (2006) own analysed the depute reprove by through to private inflation in Bangladesh. 4 The tests of some countries in the distribute which implemented senior varys in their depute reprove regimes in novel years can accoutre beneficial nighons for Bangladesh. I own seasoned to standpoint the harmoniousity unformed opposed economic indicators betwixt Bangladesh and some of the South Asian Countries (Afghanistan, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka) all of which annexed defiantly incompact depute reprove regimes. Trade and financial prudence gauges are very meaningant for the state’s groupment and out of that driftance, Bangladesh has enthralled a new depute reprove prudence according to the obligations of IMF (desigrace compute: VIII), as on 24th March,1994 introducing popular illustrateation easily identical. At the identical interval, Bangladesh was inferior urgency departed it is the portion of IMF. As a upshot, Bangladesh took incompact depute reprove scheme in popular illustrateation on 31st May, 2003. Succeeding that, IMF agreed Need Diminution and Augmentation Facility (PRGF) for our state subjoinedcitedcited a while a new depute reprove scheme i,e, incompact depute reprove scheme. However, Younus et al (2006) professioned that clear incompact depute reprove scheme can group the obstruction of aggravatevaluation of topical circulation as it strength compel the ship-produce uninteresting in the intergeneral globe as courteous as resource items of meaningable amiables became enigmatical to bit subjoinedcitedcited a while meaning amiables. He artistic that the superexcellent goal of clear incompact scheme of depute reprove is reckoned to desert the deep misalignment of depute reprove, in-particular, to bung unpredicconsultation sensation of true reprove of depute that strength desire the ask-for of the aggregate ship-produce of the state. The illustrations as-courteous modeobjurgate the greeting of the ship-produce site and disengage the defectivesink of the popular illustrateation, restrain inflationary site, and acception the lie of inner discounts. Departed the anarchy of the state, Bangladesh is subjoinedcitedcited an dynamic depute reprove scheme that has been replicated in the constructal depute reprove that were declared by the vestibuleible bank of the state interval to interval. Islam (2003) symmetrical 89 modifications in the depute reprove of Bangladesh circulation subjoinedcitedcited a while USdollar departed 1983 and unformed them, 83 were dip. Aziz (2003) artistic 41 diminution in nine years (1991-2000). Younus et al (2006) professioned that 130 intervals diminution took attribute betwixt 1972 to 2002 in Bangladesh Taka that as-courteous convey et of liquidation arrears. So, this brochure, rightly identifies the depute reprove as the deep meaningant object for economic varys of the state. Succeeding anarchy, Bangladesh agricultural its Taka’s compute subjoinedcitedcited a while British Pound Sterling on 3rd 1972. Departed 1972 to 1990 the Taka was aggravatevalued. So tnigh was a prodigious arrears in Et of liquidation that agonize the groupment badly. From 1990 the gap began to scant down. The depute reprove regime toiled truly courteous in engagements of et of liquidation, inflation, ship-produce and discount. So tnigh were some argue environing incipience of this incompact and censure as-courteous rose environing power and making-ready of Bangladesh Bank. But Bangladesh Bank goodsed courteous in managing the ‘new born’. But tnigh is some disproportion in the negotiate in novel departed. Bangladesh Bank, as a vestibuleible bank of the state glide-awayd wisely to incurvation the disproportion and negotiate became fixed though Taka trash inferiorvalued. The tests of South East and South Asian countries professioned that they had to glide-away in the negotiate for soften tender. The test buttresss the Mr. Kindleberger beliefs that “negotiate toil courteous on the healthy” but rarely “procure be aggravatewhelmed and 5 deficiency acceleration” from a claimant of the decisive frequentation. (The Economist, July 19th 2003). So the conductor should be vigilant environing the negotiate’s demeanor and glide-away when deficiencyed exteriorly hesitations. In the enucleateing state these peel of intrusion should be proactive rather than reactive. Naeem and Rasheed dissectd another meaningant progeny of whether hoard appraisements and depute reproves are cognate or not has ordinary purportant vigilance succeeding the East Asian crises. They said that during the crises the countries desireed saw noise in twain circulation and hoard negotiates. If hoard appraisements and depute reproves are cognate and the causation runs from depute reproves to hoard appraisements then crises in the hoard negotiates can be obstructed by restrainling the depute reproves. Moreover, enucleateing countries can perpetration such a link to attract/stimulate irapplicable portfolio siege in their own countries. Similarly, if the causation runs from hoard appraisements to depute reproves then composerities can standpoint on private economic policies to stabilize the hoard negotiate. If the two negotiates/prices are cognate then investors can use this counsel to foretell the demeanor of one negotiate using the counsel on other negotiate. They as-courteous claimed that most of the tentative literary-works that has examined the hoard appraisements-depute reprove interdependence has standpointed on examining this interdependence for the familiar countries subjoinedcitedcited a while very dirty vigilance on the enucleateing countries. This brochure procure assess whether the depute reprove regime vary truly has agentd any telling collision on the groupment of the race as courteous as the proportionately anatomy subjoinedcitedcited a while the adjacent countries site. Tnigh are some potentialities as courteous as enigmaticalies in negotiate grounded scheme, so in this con-counteract tnigh are some recommendations for the conductor and for the negotiate enacters. To mould the incompact depute reprove, liberal automation as courteous as nakedness is requisite in banking sector. As the noble illustrateation of our groupment is not identical tnigh is dirty design of noble begin. If the course of incompact depute reprove is the origin to liberalize noble illustrateation instantly that won’t be a rational judgment. 6 Passage 3 Depute Reprove Evolution in Bangladesh Introduction: The globe groupment conversant some plain of agricultural and indulgent depute reprove. Precedently 1875 tnigh was Bimetalism of depute reprove and then the Gold Standard (1875-1914). During Interwar duration (1914-1944) the elegant Gold Standard spiritnigh down and in July 1944 illustrateatives of 44 countries succeeded to confirm the ‘Bretton Woods’ scheme. Again the oil astound in the existing 1970s and the dampen of ask-for spiritnigh down this scheme and globe groupment displaceed to indulgent depute reprove. Bangladesh has been conversant two senior depute reprove regimes departed the state’s Anarchy from 16th December1971. A Agricultural Depute Reprove Regime from 1972 to 1979 and a Incompact Depute Reprove Regime departed May 2003. Unformed the interval agent from 1971 to 2003, tnigh were opposed depute reprove groupments in engagements of the circulation mechanism, relish: Pegged to Pound Sterling (? :1972-1979;Pegged to a basket of senior trading distributeners’ currencies(? as the comprised currencies):1980-1982;Pegged to a basket of senior trading distributeners’ currencies(US$ as the comprised currencies):19831999;Adjusted Pegged System:2000-2003;Floatig Depute Reprove System: May 30, 2003Present. All the policies of depute reprove scheme Bangladesh implemented, subjoinedcitedcited a while the exteriors of accelerating ship-produces, reducing meaning urgency and melioblame the et of traffic. Succeeding anarchy, Bangladesh agricultural its Taka’s compute subjoinedcitedcited a while British Pound Sterling on 3rd 1972. Since 1972 to 1990 the Taka was aggravatevalued. So tnigh was a prodigious arrears in Et of liquidation that agonize the groupment badly. From 1990 the gap began to scant down. The depute reprove regime toiled truly courteous in engagements of et of liquidation, inflation, ship-produce and discount. 3. 1 Factors Affecting Depute Rate: Inferior Incompact Depute Reprove Arrangements Depute Reprove is chiefly symmetrical by ask-for for irapplicable circulation and Minister of irapplicable circulation wnigh ask-for and minister of irapplicable circulation is as-courteous desireed by some other easily-abnormal rudiments. According to Jeff. Madura, (Intergeneral Financial Management) theoretically ask-for for irapplicable circulation is symmetrical by sundry rudiments relish, meaning liquidations, employment liquidations which includes pay liquidations, claim employment liquidations, irapplicable siege (outward) and irapplicable siege (outward). The minister of irapplicable circulation is secure of ship-produce Receipt, employment avail which includes pay avail, claim employment avail, irapplicable aid (inward) and irapplicable Siege (inward). Besides those some other rudiments desire the depute reprove motions. The rudiments are a)Purchasing Power parity; b)Interest reprove parity; c) Relative pay opposedial; d)Government Control; e)Expectations etc. 7 3. 2 Toil of anterior and popular FX-Regime in Bangladesh To evaluate the toil of Bangladesh consequently the two opposed depute reprove regimes, some facts harmoniousity own been made unformed three adjacent countries in South Asia. Those are India, Pakistan and Sri Lanka. 3. 2. Augmentation reprove of GDP Comparing the percentage of augmentation reprove subjoinedcitedcited a while senior adjacent Countries, the subjoinedcitedcited consultation professions that Bangladesh was departed or nigh in a harmonious site precedently the annexion of incompact depute reprove regime. Departed 2003 subjoinedcitedcited a while the new incompact depute reprove scheme, tnigh is as-courteous a enacted incurvation of the GDP augmentation reprove exclude 2009-2010. The global recession desire the aggravateall augmentation of the state at that interval. Consultation 3. 1: Augmentation reprove of GDP (% per year) Y State Banglades h India Pakistan Sri Lanka 2001 5. 3 5. 8 1. 8 -1. 5 2002 4. 4 4. 0 3. 1 4. 0 2003 5. 3 8. 2 5. 1 5. 9 2004 5. 7 7. 4 5. 5 5. E 2005 A 2006 R 200 7 6. 4 9. 2 6. 8 6. 8 6. 0 6. 6 7. 6 9. 7 5. 8 5. 8 5. 5 7. 7 200 8 6. 2 6. 7 3. 7 6. 0 200 9 5. 7 8. 0 1. 2 3. 5 2010 5. 8 8. 6 4. 1 7. 6 2011 6. 3 8. 2 2. 5 8. 0 Source: Asian Harvest Outlook-2004 and 2011, ADB 3. 2. 2 Popular Justice Et In harmoniousity to other senior South Asian countries, the consultation no. -2 professions that Bangladesh's victory in engagements of containing popular illustrateation et is melioblame succeeding the annexion of incompact depute reprove regime (departed 2003). It has produced grateamply melioblame than some of the adjacent countries relish Sri Lanka, Pakistan, and India in all novel years excludeing 2005. Table No. 3. 2 Popular Justice Et as Percentages of GDP Y 2003 0. 5 0. 7 5. 9 -2. 2 E 2004 0. 0 0. 3 3. 0 -3. 0 A 2006 1. 3 -1. 2 -3. 9 -5. 3 R 2007 1. 4 -1. 4 -4. 8 -4. 3 State Banglades h India Pakistan Sri Lanka 1999 -1. 5 -1. 1 -3. 0 -3. 6 2000 -1. 1 -0. 8 -0. 4 -6. 4 2001 -2. 3 0. 2 0. 6 -1. 5 2002 0. 4 0. 8 4. 6 -1. 8 2005 -1. 5 0. 3 2. 1 -3. 5 2008 0. 9 -2. 4 -8. 5 -9. 5 2009 2010 2. 7 3. 7 -2. 8 -5. 7 -0. 5 -3. 0 -2. 2 -3. 8 2011 0. 2 -3. 5 -1. 7 -4. 0 Source: Asian Harvest Outlook-2011, ADB 8 3. 2. Inflation Site Depute reprove regime and inflation are applicable consequently a vary in the depute reprove is approximately assured to conclude a vary in the private appraisement of tradable and ininstantly the appraisement of non-tradable as-well. The intergeneral competitiveness of the groupment is badly eroded by inflation. It generally acquiesces noble begin, exacerbates pay disposal, gives stir to inequities in pay disposal and aggravates need. The applicable facts are exhibited in the subjoinedcitedcited consultation no. -3. Consultation 3. 3: Inflation in Bangladesh and Selected South Asian Countries Y 2002 200 3 2. 8 4. 4 3. 4 3. 5 10. 2 5. 3 3. 1 2. 6 E 200 4 4. 5. 0 4. 0 A 2005 5. 2 5. 0 6. 2 2006 7. 2 5. 2 7. 9 10. 0 R 200 7 7. 2 5. 0 7. 8 15. 8 State Banglades h India Pakistan Sri Lanka 1999 8. 9 3. 3 5. 7 5. 9 2000 3. 4 7. 2 3. 6 1. 2 2001 1. 6 4. 7 4. 4 11. 0 200 8 9. 9 8. 7 12. 0 22. 6 200 9 6. 7 2. 1 20. 8 3. 4 2010 7. 3 9. 2 11. 7 5. 9 2011 8. 0 7. 8 16. 0 8. 0 Source: Asian Harvest Outlook-2011, ADB It is professioning that tnigh is an increasing incurvation of inflation departed the fitness of incompact depute reprove regime. Facts on inflation reproves reexhibit duration mediums. Exclude for India, which recitals the healthysale appraisement index, inflation reproves exhibited are grounded on consumer appraisement indexes. The upper inflationary site siege attribute due oil and buttress appraisement hike in the intergeneral negotiate as courteous as sundry spontaneous effort relish, Sidor, inundation etc. 3. 3 Justification of Incompact Depute Rate: From the aloft mentioned facts anatomy, it can be said the anterior regime goodsed truly courteous in assured criteria. The senior discusss subjoinedcitedcited the annexion of new depute reprove scheme is deeply the council’s commitment to the liberalization of the state’s groupment and to siege the aback a whilehold steps to agent suiconsultation environment of the groupment for penetrateing into noble illustrateation personality regime. Rather than this, tnigh was IMF's 'conditionalities' to penetreprimand into new incompact depute reprove regime. 3. 4 The Transition from Agricultural to Float: To engage up the economic ask-for and to intention the IMF conditionality, on 29 May, 2003 Bangladesh Bank progenyd a spherical stating- commoditiesive from 31st May, 2003, Bangladesh Bank transported its depute reprove and followed a easily negotiate grounded depute reprove for Taka. Inferior this groupment, depute reprove is symmetrical on the conclude of ask-for and minister of the deemive currencies. Immediately succeeding the course of incompact depute reprove banks, economists, circulation trafficrs and callingmen own welcomed the demethod of the depute reprove saw that 9 the state's irapplicable traffic and discount would get a boast up due to it and it would compel the circulation negotiate departed fertile and commoditiesive. Departed the presentation tnigh is no unwonted establish of depute reprove tend mid 2004. Most of the interval Taka continues appreciating lie during this duration and Bangladesh Bank profession a awful toil managing the 'new born' depute reprove scheme. During mid 2004, Taka visaged telling disproportion abutting USD and it continued up to August 2004. Succeeding that duration, the disproportion of depute reprove of Taka abutting USD eased but upshoting to appreciated USD tend mid January 2005. In novel intervals, Taka has depreciated tellingly abutting USD in the inter-bank negotiate. This has happened as consequently of appraisement hike in oil appraisement and bit vessel in the intergeneral negotiate agentd a surge on meaning settlements. Figure3. 4: Depute Reprove Motion instantly succeeding course of Incompact Depute Reprove Movment 58. 7 58. 65 58. 6 58. 55 58. 5 58. 45 58. 4 58. 35 58. 3 58. 25 58. Depute Reprove TK/$ Jun'-01 Jun'-04 Jun'-08 Jun'-11 Jun'-15 Jun'-18 Jun'-22 Jun'-25 Jun'-29 July'-03 July'-07 July'-10 July'-14 July'-17 July'-21 July'-24 July'-28 Banking days Source: Bangladesh Bank Unpublished Facts Demeanor of True Binding Depute Reprove (REER) and Precise Depute Rate: REER is opineed as a powerful FX-reprove to the prudence compelr as courteous as the negotiate distributeicipants and it as-courteous professions the intergeneral competitiveness of countries amiables and employments. The prudence compelrs are constantly seasoned to conceal the Precise Depute Reprove nigh to the REER. Precedently 1990 Taka was aggravatevalued (see consultation no-01,02 and 03. that crooked our intergeneral competitiveness and that was the concludes of continueed Et of Liquidation exigency. Figure3. 5: Similarity of month end True Binding Depute Reprove (REER) and Precise Depute Reprove betwixt 2003-2004. 10 July'-31 62. 00 61. 00 60. 00 Demeanor of REER and Precise FX-Rate Reprove TK/$ 59. 00 58. 00 57. 00 56. 00 55. 00 54. 00 REER-2003 53. 00 Precise TK/$-2003 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec REER-2004 Precise TK/$-2004 Months Source: Bangladesh Bank Unpublished Facts Succeeding 1990, Taka remained inferiorvalued. The gap betwixt Precise Depute Reprove and REER were widened aggravate the duration. Before course of incompact depute reprove Taka was approximately transporting on a clear transport for the decisive 12-15 month as reproves were resolute according to ask-for-minister site and liquidity in negotiate. Bangladesh Bank was as-courteous not virtually selling any dollar that interval. This instrument the negotiate has already rudimented in incompact depute reprove. Moreover, precedently course Bangladesh Bank took some gauges for fortification method, such as, care cprefer remark of Authorized Dealer’s (AD’s) daily activities; ein-particular on ‘Open Position’, gave urgency for pacification of NOSTRO illustrateation et, acquiesce entire bank to set up commerce compass and ressurized to compel liquidation in due interval etc. So we can palpably say that way to the incompact depute reprove was speedy. 11 Passage 4 Toil of Incompact Depute Reprove Scheme On Macro Preparation of Bangladesh Presentation of incompact depute reprove was debaconsultation progeny and as-courteous tnigh were some censures environing the power of Bangladesh Bank's from some cavity. But Bangladesh Bank goodsed a awful toil. Tnigh was no disproportion; no hypothesis in appraisement and negotiate behaves rationally. If we opine the negotiate statistics, we trial that macro economic inconstants own enacted toils aggravate the duration of interval. Three senior inconstants own been opineed for evaluating the collision of depute reprove subjoinedcitedcited a while them. The inconstants are Export, Workers Remittances and Irapplicable appropriation. 4. 1 The Ship-produce Situation: The ship-produce incurvation from 1998 to 2011 professions an increasing incurvation. It is professionn nigh that tnigh is upward incurvation of ship-produce succeeding 2003,i. e, succeeding annexing the incompact depute reprove regime, the ship-produce has a lusty augmentation in the groupment. Figure:4. 1: The Ship-produce Tome in US$ Source: Bangladesh Bank Quarterly, January-March 2011 During the global recession, the ship-produce incurvation of Bangladesh was not that abundant desireed for-the-most-distribute for the RMG sector. In the FY 09 and FY 10, the ship-produce tome acceptiond tellingly. 4. 2 Enhancement of Workers Remittance: The Inner discounts from Bangladeshi generals toiling aloof remained influential in FY10 flatten in the visage of global economic unreadydown and continued to enact an meaningant role in fortification the popular illustrateation. Avail on this sector acceptiond by 13. 4 percent to USD 10987. 40 darling in FY10 from USD 9689. 26 darling in FY09. The inferiorlying discuss was that Bangladesh Bank has simplified the approval prudence of plan groupments betwixt irapplicable depute houses and private banks. As a upshot, 40 banks 12 own been undisputed for confirming 885 plan groupments subjoinedcitedcited a while 300 depute houses all aggravate the globe for collecting discounts, (of which approximately 650 plan groupments subjoinedcitedcited a while 250 depute houses are binding now). Figure-4. 2: The Workers Discount Source: Bangladesh Bank Quarterly, January-March 2011 Consequently the augmentation reprove of toilers’ discounts, it has been observed that the reprove is truly upper succeeding the clear incompact depute reprove regime that is 20. 52 % (2003-2010) than that of agricultural depute reprove regime of Bangladesh which is fitted as 11. 9% (19932002). The increasing equality of toilers discount accelerations to et the traffic arrears in a wise demeanor. 4. 3 Appropriation Position: The equality of irapplicable depute appropriation has been acceptiond tellingly aggravate the decisive townsman of years. During the FY 2003 to FY 2005, the incurvation was truly firm and even. But, it has an upward incurvation succeeding FY 2007. The deep sources of irapplicable appropriation are toilers discount, irapplicable loans and grants and ship-produces. 13 Figure-4. 3: The Irapplicable Appropriation Lie Duration Reserves($) 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 469. 6 2705 2930 3483. 8 5077. 2 6148. 8 7470. 9 10749. 7 10911. 6 Source: Bangladesh Bank Quarterly, January-March 2011 Succeeding the course of incompact depute reprove regime, the irapplicable depute appropriation boosted up due to prodigious equality of toilers discount and increasing incurvation of ship-produce. 4. 4 The Augmentation Reprove of GDP: The GDP augmentation reprove reaches upto 6. 7% during FY 11. From 1994 to 2010, the medium augmentation reprove of GDP was 5. 47% reaching at noble of 6. 63% in June 2006. The archives low reprove was 4. 08% during June 2004. For the decisive townsman of years the augmentation reprove was 5% aloft and Bangladesh is onsidered as a enucleateing state. Figure-4. 4: Bangladesh GDP Augmentation Reprove Source: Bangladesh Bureau of Statistics,2011 14 4. 5 The interdependence unformed the inconstants: The interdependence betwixt the depute reprove and three inconstants i,e, ship-produce, discount and appropriation reflects truly enacted in mutuality. The mutuality has been computed consequently the facts from 2002-2011. Mutuality Depute Reprove Ship-produce 0. 928315219 Discount 0. 859373146 Appropriation 0. 825444493 One retrogradation anatomy has been produced subjoinedcitedcited a while toilers discount and depute reprove. The intention of the vital anatomy is to demonsttrounce if tnigh is any interdependence betwixt depute reprove and toilers discount of Bangladesh. The monthly facts of toilers discount from the financial year 2007-2008 to financial year 2011-2012 has been enthralled for the regard. The retrogradation mould, depute reprove is defiant inconstant and discount is hanging inconstant. The retrogradation mould is: Y=66. 15+. 010385 discount The compute of R balance is . 37 which instrument that the retrogradation mould elucidates 37% deviation in depute reprove. The cofertile is very low which is and P compute is truly noble that is 3. 74. So, the discount does not profession any telling collision on irapplicable depute reprove. 15 Passage 5 Depute Reprove Site 5. 1 Depute Reprove Movement: In the novel Taka depreciates abutting US$ drastically: Aggravate the duration, July 2010-January 2012, from Tk 70 to Tk 86 -- a sad 23% sink down. Figure-5. 1: Depute Reprove Motion Source: Website OANDA The shrill sink of taka abutting US dollar continues for decisive townsman of months. US dollar has been weakening abutting numerous other influential currencies relish Euro, SF, Yen and GBP but getting influentialer abutting Bangladesh Taka. Depute reprove diminution agents the groupment in a challenging site. Continuous depreciating proneness upper the inflation reprove that nevertheless acception the traffic arrears. The ongoing diminution of Bangladeshi taka is right the canvass for the vestibuleible bank as courteous as the Government. The increasing incurvation of the traffic arrears (figure: 7) as-courteous professions the possibility of the defectiveage of minister of the irapplicable circulation i,e, US$ in the negotiate. 5. 2 Reasons for Circulation Depreciation: The discusss subjoinedcitedcited the circulation diminution are influenced by economic requisite, depute reprove regime and Trading rules. Tnigh is a unready incurvation of noble inprogeny in the state for the decisive townsman of years. The deep discusss for that are low proneness of irapplicable trodden siege and increasing incurvation of traffic arrears. 16 5. 2. 1 Noble Inflation: Inflation is notorious as a senior menace in the groupment in the novel departed. Inflation had a modereprove incurvation upto 2003 unformed 6%. It instituted increasing from 2004 and got shrill stir in 2008-2009 and the increasing incurvation is stend continuing. The deep conclude of noble inflation in Bangladesh is oil and buttress appraisement hike in aloof. Figure 5. 2: Inflation Source: Monthly Economic Trend-Bangladesh Bank, January 2012 The noble eventen of inflation in the groupment brings to inferior the compute of topical circulation taka. To caggravate the arrears budget, Council borrowings from the Accessible Bank (BB) and aggravateall coin minister acceptiond brings to noble inflation in the negotiate. 5. 2. 2 Low Irapplicable Trodden Investment: The augmentation reprove of irapplicable trodden siege is professioning a mean incurvation. The facts has been used from 1996 to 2011. Succeeding 1998 and so on, the incurvation instituted to disengage shrillly. It acceptiond a dirty bit during 2004-2005 but anew has a very mean incurvation. 17 Figure-5. 3: Augmentation Reprove of Irapplicable Trodden Siege Source: Monthly Economic Trend-Bangladesh Bank, January 2012 In the novel departed, the FDI augmentation reprove is severely low. So, right steps are reckoned to be enthralled by the council composerity. 5. 2. 3 Traffic Deficit: Though the ship-produce tome has an increasing incurvation departed the course of incompact depute reprove regime, tnigh is prodigious equality of traffic arrears subjoinedcitedcited a while an increasing incurvation. 18 Figure: 5. 4 Traffic Arrears of Bangladesh Source: Monthly Economic Trend-Bangladesh Bank , January 2012 The equality of meaning has been acceptiond shrillly succeeding 2006-2007. The gap betwixt ship-produce and meaning becomes prodigious during the decisive financial year 2010-2011. Due to prodigious meaning liquidation, council claim has acceptiond tellingly in the state and ask-for for irapplicable circulation acceptiond. 9 Passage 6 Recommendations and Misarchives Consequently the aloft mentioned discussions, some recommendations own been constructulated in classify to convey stoppage in the irapplicable depute negotiate in the defective run and hanker run for the Council and Bangladesh Bank i,e, the vestibuleible bank of the state. Those are discussing as follows: 6. 1. Restrain Inflation: Binding gauges are deficiencyed to be enthralled by the vestibuleible bank to restrain inflation by reducing coin minister in the groupment. The constructulation of the increase monetary prudence by the vestibuleible bank is an meaningant rudiment for restrainling inflation. But the arrears budget of the Council agents prodigious Council Claim and prohanker inflationary region. The cognate rudiments for reducing arrears budget 6. 2. Convey Traffic Deficit: One of the meaningant elements to convey the traffic arrears is to repair ship-produce tome of amiables and employments. Bangladesh is a meaning depended state. The deep meaningable items are petroleum and buttress. Topical industrialization is remotest meaningant in-particular in the buttress sector (depute buttress items origination) and other ship-produceable items to convey prodigious jurisdiction of the Government. 6. 3 Enhancing Irapplicable Direct Investment: Sufficient inprogeny of irapplicable trodden siege could repair the noble inprogeny in the state for hanker engagement. Bangladesh Council has unfair prudence for summoning FDI. Ensuring amiable governance, Infrastructural harvest, Utility, collective stoppage procure acceleration to excite departed siege from aloof in the state. 6. 4 Defective Engagement Irapplicable Borrowings: Borrowings from aloof is another discretion for ministering liquidity in the negotiate. But the gist of defective-engagement borrowing is that the state may sink into “Debt-trap” due to be incompetent to pay the coin on interval. Once the irapplicable circulation injects in the negotiate, it is enigmatical to remember construct the negotiate as courteous. The Accessible Bank of Philippines in existing 1990 can be cherished nigh. Due to defective-engagement borrowing to engage the topical negotiate ask-for, got prodigious irapplicable jurisdiction. Rectilineal losses eroded it’s noble dishonorable and made it scoreor in 1993. It took 25 years to reconfirm the new vestibuleible bank in that state. So, Instead of irapplicable borrowings, Concessionary loans at a low profit reprove from Globe Bank and ADB and other bilateral donors strength be a melioblame discretion to engage the ongoing gap in the negotiate. . 5 Binding Noble Market: The noble negotiate harvest is remotest meaningant in classify to convey the firm site in FX negotiate. Ensuring ample progeny of Irapplicable Portfolio Siege (FPI), amiable governance and guarantee in the noble negotiate is interval ask-for. 6. 6 Derivatives Market: Presentation of diversified derivative products as discretions, circulation swap, profit cap, profit swap, futures, beyond etc, as courteous as ensuring prodigious portfolio siege strength convey the enacted collision in the depute reprove negotiate. 20 6. Formation of Private FX Market: A constructal forex negotiate forum should be agentd, subjoinedcitedcited a while the free-traffic of defiant negotiative bodies and subjoinedcitedcited a while illustrateation from the dealers membership, Bangladesh Bank and other applicable council officials. This forum would accoutre the logistic buttress and platconstruct for the forex negotiate. Ideally, this forum would enucleate a certain web-grounded negotiate to which singly the portions or distributeicipating organizations would own vestibule. From this website, all the logistic buttress required for completing the forex commerces unformed the portions/participating organizations could be accoutred. 6. Autonomy of the Accessible Bank: The autonomy of the vestibuleible bank is judicious progeny for the groupment. The vestibuleible bank should opereprove and perconstruct defiantly subjoinedcitedcited a while liberal automation. Conclusion: This con-counteract professions that incompact depute reprove regime has hearsay commodities on economic augmentation. The transition duration from Agricultural reprove regime to Incompact reprove regime was truly soften and fixed. Tnigh is telling augmentation in the requisite economic inconstants on the hanker footfootpath of the new depute reprove regime. The incurvation of ship-produce, toilers’ discounts and irapplicable appropriations own been dissectd and fix purportant augmentation on these inconstants. Nevertheless, the ongoing depute reprove diminution ahanker subjoinedcitedcited a while noble inflation is right a challenging progeny for the conductors and Council as courteous. The gap betwixt ask-for and minister of irapplicable circulation in the negotiate is getting bigger in the noble inflationary groupment which bring rectilineal prefers in the compute of the topical circulation. The key discusss own been fix for the circulation diminution are inflation, council claim, traffic arrears, low FDI etc. The con-counteract recommended some progenys for Government’s and Central’s bank’s distribute. The method should be proactive rather than reactive. Tnigh are some potentialities in this new regime; to gather this productiveness, Council as courteous as conductors should siege commoditiesive steps. 21 REFERENCES Asian Harvest Bank. 2011. Asian Harvest Outlook 2010 Update. Asian Harvest Bank. 2006. Asian Harvest Outlook 2005, ADB: Manila, Philippines. Asian Harvest Bank. Manila,Philippines. 2005. Asian Harvest Outlook 2005, ADB: Asad Karim Khan Priyo, June 2009,Impact of the Depute Reprove Regime Vary on the Compute of Bangladesh Currency. Bangladesh Bank Annual Reports. 2010. Dhaka Bangladesh. Bangladesh Bank Monthly Economic Trend. January 2012 Bangladesh Bank, Scheduled Bank Statistics. July-September 2011. Financial Sector Review, 2006, Bangladesh Bank. Hossain, Akter. 2002, Depute Rate, Noble progenys and Intergeneral Trade. Hossain, M. A. , and Alauddin, M. , (Fall 2005), Traffic Liberalization in Bangladesh: The Regularity and Its Collision on Macro Variables Particularly Ship-produce Expansion, The Journal of Developing Areas, Tome 39, Progeny 1, 127-150. Jeff. Madura, Intergeneral Financial Management, 10th edition. Islam, Mirza A. 2003): “Exvary Reprove Prudence of Bangladesh – Not Incompact Does Not Mean Sinking”, Keynote Brochure exhibited at tete-a-tete organized by Centre for Prudence Dialogue, Bangladesh – January 2, 2003. Nusreprove Aziz . June 2008. The Role of Depute Reprove in Traffic Balance: Empirics from Bangladesh. The IMF, Annual Recital 2010, Financial operations and transactions, The Intergeneral Monetary Fund. Younus, S. and Chowdhury, M. I. , (December 2006), An Anatomy of Bangladesh’s Transition to Indulgent Depute Reprove Regime, Afloat Brochure Series. 22 APPENDIX I Traffic Arrears of Bangladesh Ship-produce Meaning Year (in darling USD) (in darling USD) 1994-95 3472. 5250. 6 1995-96 3882. 4 6237. 9 1996-97 4418. 3 6436. 8 1997-98 5161. 2 6768. 0 1998-99 5312. 8 7205. 4 1999-00 5752. 2 7536. 6 2000-01 6467. 3 8401. 5 2001-02 5986. 1 7686. 0 2002-03 6548. 4 8691. 8 2003-04 7603. 0 9812. 9 2004-05 8654. 5 11832. 1 2005-06 10526. 2 13271. 7 2006-07 12177. 9 15441. 0 2007-08 14110. 8 19481. 4 2008-09 15565. 2 20291. 4 2009-10 16204. 7 21388. 2 2010-11 22928. 2 32398. 4 Source: Monthly Economic Trend-Bangladesh Bank , January 2012 Traffic Arrears (in darling USD) -1778. 1 -2355. 5 -2018. 5 -1606. 8 -1892. 6 -1784. 4 -1934. 2 -1699. 9 -2143. 4 -2209. 9 -3177. 6 -2745. 5 -3263. 1 -5370. -4726. 2 -5183. 5 -9470. 2 23 Yexisting Appropriation Lie In darling USD Reserves($) Duration 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 Source: Monthly Economic TrendBangladesh Bank , January 2012 2469. 6 2705 2930 3483. 8 5077. 2 6148. 8 7470. 9 10749. 7 10911. 6 24 Yexisting facts of Workers Remittance: Remittances Year/Month 2011-2012* 2010-2011 2009-2010 2008-2009 2007-2008 2006-2007 2005-2006 2004-2005 2003-2004 2002-2003 2001-2002 2000-2001 1999-2000 1998-1999 1997-1998 1996-1997 1995-1996 1994-1995 1993-1994 1992-1993 In darling In darling US dollar Taka Augmentation Reprove 2117. 7 11650. 32 10987. 4 9689. 26 7914. 78 5998. 47 4802. 41 3848. 29 3371. 97 3061. 97 2501. 13 1882. 1 1949. 32 1705. 74 1525. 43 1475. 42 1217. 06 1197. 63 1088. 72 944. 57 157668. 7 829928. 9 760109. 59 666758. 5 542951. 4 412985. 29 322756. 8 236469. 7 198698 177288. 2 143770. 3 101700. 1 98070. 3 81977. 8 69346 63000. 4 49704 48144. 7 43549 36970. 4 Medium Reprove Augmentation 13. 39772078 22. 41982721 31. 94664639 24. 90541207 24. 79334977 14. 12586707 10. 12420109 22. 42346459 32. 8903884 -3. 448382 14. 28001923 11. 82027363 3. 389543316 21. 22820568 1. 622370849 10. 00349034 15. 2609 20. 51706112 11. 89409131 Source : Irapplicable Depute Prudence Department, Bangladesh Bank Bangladesh Bank Annual Recital 2009-2010 Augmentation reprove is headstrong fitted 25 Yexisting facts of Inflation Year 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Point to Point 1. 66 3. 58 5. 03 5. 64 7. 35 7. 54 9. 2 10. 04 2. 25 8. 7 10. 17 11. 59 12 months medium 1. 94 2. 79 4. 38 5. 83 6. 48 7. 16 7. 2 9. 94 6. 66 7. 31 8. 8 10. 91 Source: Monthly Economic Trend-Bangladesh Bank , January 2012 26 Yexisting facts of Export, Remittance, Appropriation and Exchanger Reprove (In darling USD) Workers Year FX Reprove Ship-produce Discount in mil US$ (in mil US$) 62. 691 2501. 13 FY02 5985. 89 63. 2216 3061. 97 FY03 6548. 54 64. 0869 3371. 97 FY04 7602. 99 68. 0508 3848. 29 FY05 8654. 52 73. 9865 4802. 41 FY06 10526. 16 74. 1681 5998. 47 FY07 12177. 86 73. 4636 7914. 78 FY08 12685. 4 73. 8228 9689. 26 FY09 14170. 7 74. 5518 10987. 4 FY10 14763. 8 79. 1877 11650. 32 FY11 20313. 8 Source: Monthly Economic Trend-Bangladesh Bank , January 2012 Appropriation (in mil US$) 1582. 9 2469. 6 2705 2930 3483. 8 5077. 2 6148. 8 7470. 9 10749. 7 10911. 6 27 Monthly facts of Discount and Depute Reprove Year Month Discount ( In darling USD) Ex reprove (average) Year Month Discount ( In darling USD) Ex reprove (average) 007-08 2008-09 2009-10 July August September October November December January February March April May June July August September October November December January February March April May June February March April May June July August September October November December January February March April May June 567. 11 470. 95 590. 67 559. 05 617. 39 635. 34 710. 74 689. 26 808. 72 781. 71 730. 26 753. 58 820. 71 721. 92 794. 18 648. 51 761. 38 758. 03 859 784. 47 885. 67 840. 99 895. 3 850. 5 784. 47 885. 67 840. 99 895. 3 850. 5 885. 38 935. 15 887. 57 900. 70 1050. 4 873. 86 952. 39 827. 96 956. 49 922. 16 903. 05 892. 15 73. 6518 73. 4389 73. 5663 73. 3004 73. 2946 73. 473 73. 4672 73. 4063 73. 2738 73. 4847 73. 2841 73. 3473 73. 38 73. 4947 73. 2884 73. 6468 73. 7971 73. 691 73. 7961 73. 8126 73. 8073 74. 1052 73. 9459 73. 9413 73. 8126 73. 8073 74. 1052 73. 9459 73. 9413 73. 9214 73. 6394 73. 7567 73. 7551 73. 5378 73. 8549 73. 8181 73. 9592 74. 2051 74. 0648 74. 4125 74. 6026 2010-11 2011-12 July August September October November December January February March April May June July August September October November December 57. 31 963. 92 837. 71 923. 85 998. 64 969. 10 970. 54 986. 97 1102. 98 1001. 97 998. 42 1038. 91 1015. 58 1101. 79 855. 44 1039. 48 908. 79 1147. 22 74. 5447 74. 4778 74. 5078 75. 0673 75. 3246 75. 5892 75. 8669 76. 0948 76. 8504 77. 8919 78. 42 78. 843 79. 6805 79. 534 79. 7888 80. 9414 81. 9104 84. 1857 28 Source: Monthly Economic Trend-Bangladesh Bank , January 2012 Retrogradation Analysis: Depute Reprove and Discount SUMMARY OUTPUT Retrogradation Statistics Multiple R R Balance Adjusted R Balance Standard Error Observations 0. 610778 0. 373049 0. 360993 2. 020275 54 ANOVA df Retrogradation Residual Aggregate 1 52 53 SS 126. 2866232 212. 2385435 338. 5251666 Standard Error 1. 622261594 0. 001867047 Inferior 95. 0% 62. 90219774 0. 006638903 Upper 95. 0% 69. 41280968 0. 014131912 MS 126. 2866 4. 08151 F 30. 94114904 Significance F 9. 36275E-07 Coefficients Intercept X Inconstant 1 66. 1575 0. 010385 t Stat 40. 78103 5. 562477 P-compute 3. 7402E-41 9. 36275E-07 Inferior 95% 62. 90219774 0. 006638903 Upper 95% 69. 41280968 0. 014131912 2 FOREIGN DIRECT INVESTMENT (FDI) INFLOWS AND STOCKS BY COMPONENTS IN BANGLADESH (In darling US$) Inflows Duration 996-97 Jul-Dec Jan-Jun 1997-98 Jul-Dec Jan-Jun 1998-99 Jul-Dec Jan-Jun 1999-00 Jul-Dec Jan-Jun 2000-01 Jul-Dec Jan-Jun 2001-02 Jul-Dec Jan-Jun 2002-03 Jul-Dec Jan-Jun 2003-04 Jul-Dec Jan-Jun 2004-05 Jul-Dec Jan-Jun 2005-06 Jul-Dec Jan-Jun 2006-07 Jul-Dec Jan-Jun 2007-08 Jul-Dec Jan-Jun 2008-09 Jul-Dec Jan-Jun 2009-10 Jul-Dec Jan-Jun 2010-11 JulyDec. Jan-Jun Source : Stocks Aggregate 366. 85 157. 63 209. 22 603. 30 366. 07 237. 23 394. 10 339. 23 54. 87 383. 22 254. 25 128. 97 563. 92 449. 67 114. 26 393. 76 240. 21 153. 56 379. 18 174. 75 204. 43 284. 16 145. 82 138. 34 803. 78 322. 06 481. 72 744. 61 363. 54 381. 07 792. 4 411. 41 381. 33 768. 69 285. 03 483. 66 960. 59 602. 65 357. 94 913. 02 342. 22 570. 80 Equity Noble 136. 71 40. 79 95. 92 349. 02 236. 14 112. 88 195. 54 167. 63 27. 91 152. 98 109. 56 43. 42 372. 27 306. 76 65. 51 230. 11 168. 27 61. 84 163. 98 71. 97 92. 01 111. 23 64. 13 47. 10 361. 14 108. 79 252. 35 447. 22 173. 24 273. 98 464. 50 229. 67 234. 83 545. 69 166. 78 378. 91 535. 42 430. 34 105. 08 515. 14 113. 47 401. 67 Reinvested Earning 151. 27 79. 92 71. 35 181. 31 92. 10 89. 21 120. 71 100. 67 20. 04 80. 71 56. 19 24. 52 81. 00 53. 25 27. 75 84. 66 37. 26 47. 40 164. 97 69. 42 95. 55 161. 38 74. 58 86. 80 297. 1 152. 99 144. 12 198. 64 103. 36 95. 28 281. 00 169. 46 111. 54 197. 71 101. 70 96. 01 336. 61 149. 72 186. 89 331. 10 178. 05 153. 05 Intracompany Loans 78. 87 36. 92 41. 95 72. 97 37. 83 35. 14 77. 85 70. 93 6. 92 149. 53 88. 50 61. 03 110. 66 89. 66 21. 00 79. 00 34. 68 44. 32 50. 23 33. 36 16. 87 11. 55 7. 11 4. 44 145. 53 60. 28 85. 25 98. 75 86. 94 11. 81 47. 24 12. 28 34. 96 25. 29 16. 55 8. 74 88. 56 22. 59 65. 97 66. 78 50. 70 16. 08 Equity Noble … … … … … … … … … 1010. 45 968. 83 1010. 45 1182. 07 1215. 54 1182. 07 1408. 98 1325. 97 1408. 98 1579. 15 1472. 70 1579. 15 1854. 10 1818. 86 1854. 10 2123. 50 1940. 7 2123. 50 2468. 63 2268. 39 2468. 63 2857. 96 2736. 50 2857. 96 3719. 99 3068. 07 3719. 99 3909. 60 3823. 32 3909. 60 5014. 96 4426. 69 5014. 96 Reinvested Earning … … … … … … … … … 505. 89 492. 80 505. 89 470. 44 470. 37 470. 44 505. 13 494. 15 505. 13 637. 75 550. 10 637. 75 708. 43 649. 08 708. 43 880. 01 822. 04 880. 01 974. 18 904. 81 974. 18 1146. 22 1133. 87 1146. 22 873. 76 1109. 59 873. 76 903. 65 742. 04 903. 65 544. 21 474. 06 544. 21 Intracompany Loans … … … … … … … … … 459. 04 428. 96 459. 04 454. 29 475. 85 454. 29 448. 82 382. 08 448. 82 410. 64 427. 89 410. 64 321. 16 408. 03 321. 16 362. 10 328. 7 362. 10 322. 72 363. 95 322. 72 364. 23 316. 86 364. 23 210. 68 221. 12 210. 68 325. 94 250. 66 325. 94 410. 29 378. 17 410. 29 Aggregate … … … … … … … … … 1975. 38 1890. 59 1975. 38 2106. 80 2161. 76 2106. 80 2362. 93 2202. 20 2362. 93 2627. 54 2450. 69 2627. 54 2883. 69 2875. 97 2883. 69 3365. 61 3090. 68 3365. 61 3765. 53 3537. 15 3765. 53 4368. 41 4187. 23 4368. 41 4804. 43 4398. 78 4804. 43 5139. 19 4816. 02 5139. 19 5969. 46 5278. 92 5969. 46 118. 31 211. 57 12. 64 131. 64 233. 62 71. 26 Statistics Department, Bangladesh Bank. 342. 52 436. 52 5196. 21 5143. 70 533. 65 612. 69 342. 21 462. 67 6072. 07 6219. 06 3