DHAKA, Jul 19 (NNN-BSS) – Bangladesh yesterday, imposed a raft of austerity measures, to restrict fuel imports with immediate effect, to try to take pressure off the forex reserves.
The latest measures included a production halt of all diesel-run power plants, currently in the country, until further notice.
Authorities here also decided to keep fuel stations across the country closed for a day, every week, in an apparent bid to thwart the power and energy crisis.
Tawfiq-e-Elahi Chowdhury, energy advisor to Prime Minister Sheikh Hasina, and State Minister for the Ministry of Power, Energy, and Mineral Resources, Nasrul Hamid, jointly made the announcement after a meeting at the Prime Minister’s Office in Dhakka yesterday.
After the meeting, Chowdhury said, the fresh moves are aimed at reducing the government’s expenditure on power generation.
“We’ve decided that plants using diesel to produce electricity will suspend operations from today (yesterday),” he added.
Meanwhile, he said, this will create a shortage of 1,000-1,500 MW of electricity.
Against this backdrop, the adviser said, area-wise load-shedding will be in place for 1-2 hours every day.
Comparing the current crisis with a “war-like situation,” he said, “shops will have to close down at 8:00 p.m.”
The use of air conditioners in mosques has been barred, said the officer, while all government office hours will be shortened and meetings will be held online.
Hamid said, customers will be notified in advance about the load shedding schedule, and steps will be taken so that vehicles use less fuel.
“These measures, forced by the Russia-Ukraine war, are not long-term,” he said.
The decisions came, a day after the central bank withdrew the interest rate ceiling on non-resident foreign currency deposits, in an apparent bid to boost shrinking forex reserves.
Bangladesh’s foreign exchange reserves, last week, fell below 40 billion U.S. dollars, for the first time in two years, weighed by higher import bills and the taka’s weakness, driven by the dollar’s broad surge in recent months.
Bangladesh’s forex reserves surpassed the 48-billion-dollar mark in Aug last year, the highest ever in history, due to a slowdown in imports and rising remittance and export earnings, during the COVID-19 pandemic.
The government earlier restricted foreign trips of its officials, under development budgets, in the context of post-COVID-19 economic recovery and an ongoing global crisis.
Also, the central bank of Bangladesh toughened its rules for luxury and non-essential imports, like sports utility vehicles, washing machines, air conditioners and refrigerators.
The central bank of Bangladesh last month withdrew fixed U.S. dollar-taka exchange rate, allowing the market to set the price based on demand and supply.
Abdur Rouf Talukder, who was appointed central bank governor last month, told media recently that, his priority task would be containing inflation, which the Bangladeshi government aims to keep below 5.6 percent.
Meanwhile, Talukder stressed the need to maintain stability in dollar-Taka exchange rate, for stable international trade by reining in currency volatility.– NNN-BSS
