Bangladesh Bank Governor has pledged full support for entrepreneurs to help them reopen shuttered factories

Bangladesh Bank Governor Md Mostaqur Rahman has reaffirmed the central bank’s commitment to helping reopen closed factories and addressing the challenges facing private sector entrepreneurs. He noted that while some factories had shut earlier, closures have increased since 5 August.

“We are focusing on how these factories can resume production,” he said, adding that banks are being encouraged to support such efforts so businesses can restart operations, repay loans, and contribute to economic growth. Otherwise, assets will continue to deteriorate and banks may struggle to recover funds.

He made the remarks on Sunday (29 March) during a meeting with business editors, senior journalists, and leaders of the Economic Reporters’ Forum at the Bangladesh Bank headquarters in Dhaka.

The Governor also sought journalists’ views on the broader macroeconomic situation, while deputy governors pointed to risks stemming from prolonged global conflicts.

He stressed that Bangladesh Bank is working closely with the government to restore investor confidence and stimulate investment, while also engaging leading entrepreneurs to resolve their concerns.

Depoliticising the Financial Sector

Rahman underscored the importance of keeping the financial sector free from political influence. “We want to learn from past mistakes and bring change. There should be no political interference in the banking sector,” he said, adding that he is prepared to withstand any pressure to ensure this.

Recovering Laundered Funds

Acknowledging the global challenges of recovering laundered money, he said efforts are ongoing to retrieve such funds, which belong to depositors. Legal steps have been initiated in partnership with international asset recovery and litigation financing firms.

Startup Fund and Employment

A Tk 6 billion startup fund is set to begin disbursement in June, with a planned launch in April, prioritising ventures that generate employment. He also emphasised boosting domestic demand, particularly in rural areas, while noting that the tax-to-GDP ratio remains below 7%.

Banking Reforms and Services

Referring to the consolidated Islamic bank, he said there is no scope to reverse course, with the appointment of a managing director and chairman underway. The focus remains on professional management and improved service standards in line with central bank guidelines.

Preparedness for Middle East Crisis

Bangladesh Bank has outlined contingency measures to mitigate potential economic shocks from ongoing tensions in the Middle East, particularly any escalation involving Iran. The central bank said foreign exchange reserves are sufficient to cover imports for three to four months.

Exchange rates are expected to remain stable, while steps are being taken to secure a $2 billion loan to ease balance of payments pressure. Remittances may rise to $2–2.5 billion around Eid-ul-Azha, and a $1.5 billion tranche from the International Monetary Fund is expected in June. The government is also exploring government-to-government fuel import arrangements at lower cost or as grants.

Risks and Challenges

However, the Governor warned that a prolonged conflict could pose serious risks. Job losses among Bangladeshi workers in the Middle East could reduce remittance inflows and increase domestic employment pressure. He also cautioned that IMF-driven subsidy cuts may fuel inflation, while weak revenue collection could strain the budget.

Other Measures

Plans are underway to expand agricultural credit and introduce new refinancing schemes. From 1 July, Bangla QR codes will be mandatory to strengthen revenue collection.

The Governor also highlighted ongoing efforts to ensure accountability despite challenges such as sluggish investment, declining revenue trends, and external uncertainties.