Remittance is once again our saving grace
We are pleased to know that remittance inflow into Bangladesh rose to a seven-month high in March. According to data from Bangladesh Bank, remitters sent home $2.02 billion last month, the highest since September last year when $1.53 billion came into the country. It is important to remember that remittance usually goes up before Eid-ul-Fitr, which will be celebrated in the fourth week of this month. Therefore, it would be unwise for us to get too carried away by this increase. However, at a time when there is growing pressure on our foreign exchange reserves, the increased flow will provide some much-needed relief for the country.
Another reason which could have encouraged greater remittance inflow is the fact that banks have been offering remitters a higher rate for the dollar than the one set by the Bangladesh Foreign Exchange Dealers Association (Bafeda). Data from Bangladesh Bank shows that remittance inflow through the banking channel rose by 29.29 percent in March compared to the previous month. Still, there is much more that can be done to further increase it by encouraging the use of official channels and reducing demand for sending remittance through unofficial channels like hundi. And we hope the concerned authorities are looking at that from all possible angles.
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Given the crucial contribution that migrant workers continue to make to our economy, the government should also do more to help them in terms of sending money back to the country, and to ensure hassle-free migration. Additionally, as instructed by the prime minister on Sunday, the concerned authorities should try and find new destination countries to send our aspiring migrant workers to. Not only can this increase our remittance earnings, but by diversifying destination countries for migrants, it can increase their employment opportunities as well.
At the same time, however, it is disappointing that export earnings have dropped for the first time in five months in March. Last month, exporters brought in $4.64 billion, down nearly 2.5 percent from a year earlier, according to the Export Promotion Bureau (EPB). However, the bigger picture shows that our overall export earnings have been in the positive territory between July and March of the current fiscal year, with receipts growing 8.07 percent year-on-year to $41.72 billion. This growth, unsurprisingly, has been primarily driven by the readymade garments sector, which saw a 12.17 percent growth in the same period, according to the EPB. But apart from the garments sector, most other major sectors registered a negative growth year-on-year. The authorities should take a closer look at why that is the case and try to rectify it.
With the global economy continuing to struggle, and our foreign exchange reserves still at a lower-than-adequate level, increasing our remittance and exports earnings is more crucial now than ever before. The government should try to reduce the costs and hassles of migration and travel for our aspiring migrant workers, and make sure they are provided with all the necessary incentives – financial incentives in particular – to send in remittance through the banking channel.
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