Record $30b remittance lifts reserves to $26b
Expatriates remitted $2.53b as of 28 June
Bangladesh has received $30.04 billion in remittance in the current fiscal year, already setting a new annual record with a day still remaining before the year ends.
Boosted by this inflow and increased funding from multilateral lenders, foreign exchange reserves also rose to $26.32 billion yesterday under the IMF's BPM6 calculation method.
The remittance figure represents a 25.5% year-on-year increase from $23.74 billion in FY24, according to Bangladesh Bank. The previous record was set in the Covid-hit FY21, when overseas Bangladeshis sent $24.77 billion.
Central bank data shows expatriates remitted $2.53 billion as of 28 June alone, compared to $2.37 billion during the same period last year.
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Bankers said remittances are increasingly flowing through official channels, as the bank rate now closely matches open market rates and the government has intensified its crackdown on hundi networks.
Currently, banks are offering around Tk122.50 per dollar, which rises to about Tk125 when the 2.5% government incentive is added, they said.
"The narrowing gap between bank and kerb rates has sharply reduced informal transactions," said the treasury head of a private bank.
"The government's vigilance against money laundering has further strengthened banking channel flows."
Officials from two state banks said monthly remittance inflows are now approaching $3 billion, up from around $2 billion in previous months. They added that if undocumented migrant workers could also be brought into the formal system, monthly inflows could reach $4 billion.
They noted that with rising exports and remittances but falling imports, the reserve position is steadily improving. "Imports of capital machinery remain subdued, but when that picks up, it will signal a new investment cycle and greater external payments," said one banker.
Reserves boosted by multilateral lenders
Foreign exchange reserves stood at $22.24 billion on 24 June but rose to $26.32 billion the following day after fresh disbursements from multiple international lenders.
According to central bank officials, these included over $1.30 billion from the IMF, $800 million from the Asian Infrastructure Investment Bank (AIIB), $900 million from the Asian Development Bank (ADB), and $850 million combined from JICA and the World Bank.
Bangladesh Bank data shows the country's gross foreign exchange reserves stood at $31.31 billion as of 29 June. Under the IMF's BPM6 method, gross reserves totalled $26.32 billion, while net reserves stood at $20.31 billion.
Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), said the rise in reserves has been driven by steady remittance inflows and multilateral financing.
However, she pointed out that over the past year, the government had to clear a large volume of overdue foreign payments, reducing reserve accumulation by $4-$5 billion.
"To sustain remittance growth, the government must prevent any resurgence of hundi networks and offer better incentives to expatriates," she told The Business Standard.
She called for improved airport services for migrant workers, enhanced overseas training programmes, and formal channels to capture remittances from undocumented workers.
