Trade deficit swells

Trade deficit doubled year-on-year in the first five months of the fiscal year on the back of high import and low export growth.

Between July and November, trade deficit stood at $4.48 billion, which was $2.25 billion in the same period last fiscal year, according to data from Bangladesh Bank.

Imports surged 16.62 percent but exports rose a negligible 0.01 percent.

Capital machinery, petroleum products, industrial raw materials along with materials for the Padma bridge account for the spike in imports, said a high official of Bangladesh Bank.

Exports, in contrast, stuttered during the period for the sluggish performance of the garment sector, which typically accounts for 80 percent of the country’s exports.

However, if the present political situation continues the prevailing investment situation may take a turn for the worse. In other words, imports might drop.

Meanwhile, with the widening trade deficit, the overall balance of the external sector eroded by half.

The overall balance in the July-November period stood at $1.16 billion, which was $2.04 billion in the same period of fiscal 2013-14.

The current account balance also turned negative in the first five months: it was $1.31 billion in the deficit against the surplus of $1.12 billion during the same period last fiscal year.