• Wednesday, September 03, 2014

Business

Costly electricity weighs on budget

The power sector has achieved remarkable success in generation and supply, but the high production cost, a major concern, is piling pressure on the national budget, according to a government review report. The power sector will be part of a discussion today as the planning ministry presents the mid-term review of the Sixth Five-Year Plan (SFYP) designed for the country's economic development. “Much of the additional private electricity supply has come from rental plants that supply electricity to the national grid at a much higher cost than from other sources,” the report said. The government missed its target to diversify sources of primary fuel by boosting domestic production of gas and coal, according to the report. The SFYP started in July 2011 and will end in June 2015. When the plan was launched the power generation capacity was 5,823 megawatts. It rose to 9,598MW in fiscal 2013-14. As a result, the population's access to electricity went up from 47 percent in fiscal 2010-11 to 62 percent in fiscal 2013-14. As a result, per capita electricity consumption rose from 170 kilowatt/hour (KWh) to 285 KWh, according to statistics from the planning ministry. However, unforeseen development led to a huge increase in the marginal cost...

Pharma exports in fast lane

Pharma exports in fast lane

Pharmaceutical exports rose 15.65 percent year-on-year to Tk 553.3 crore in...

Seed market grows, led by private firms

Seed market grows, led by private firms

The seed market is growing due to massive marketing campaigns by...

Bangladesh ready to work for blue growth: minister

Bangladesh ready to work for blue growth: minister

Bangladesh is willing to work and move together with a partnership...

Islamic bonds' maturity period cut by half

The central bank has cut the maturity period of Islamic bonds by half as it amended the guideline on their issuance to make them attractive. A Bangladesh Bank official said the maturity period has been set at three months, along with the existing six months, to help Islamic banks and financial institutions manage their fund smoothly. The profit of Islamic bonds will equal the profit of a three-month fixed deposit scheme of the issuing Islamic banks, replacing the profits rate for...

BB to focus on good governance in five-year plan

Bangladesh is not unique in facing financial frauds; it happens everywhere in the world, SK Sur Chowdhury, deputy governor of Bangladesh Bank, said yesterday. “We have detected those scams and have taken so many actions,” Chowdhury said at a press briefing at the central bank. He cited setting up a financial stability department at the central bank as an example of combating such situations. Governor Atiur Rahman was also present at the briefing held to inform the media of BB's fourth...

Europe drafts emergency energy plan with eye on Russia gas shut-down

The European Union could ban gas exports and limit industrial use as part of emergency measures to protect household energy supplies this winter, a source told Reuters, as it braces for a possible halt in Russian gas as a result of the Ukraine crisis. Russia is Europe's biggest supplier of oil, coal and natural gas, and its pipelines through Ukraine are currently the subject of political manoeuvering - not for the first time - as Europe and Moscow clash over...

Japan's Abenomics feared in trouble as challenges build

Prime Minister Shinzo Abe's plan for Japan's economy to generate self-sustained growth on the back of his three policy "arrows" of massive monetary easing, spending and reform appears to be faltering -- but no magic solution is in sight. Abe's aides and advisers are promising to forge ahead with painful structural reforms, while spreading the benefits of "Abenomics" to regional areas and drafting a long-term vision for addressing Japan's shrinking population. But gloomy economic data suggests the plan is not succeeding...

Japan wage growth surges in July

Japanese wages unexpectedly logged their strongest increase since 1997, providing a boost to the government's battle against deflation. Labour cash earnings rose by 2.6 percent in July compared to a year ago, beating forecasts of a slowdown to 0.9 percent. Special payments, or summer bonuses, grew by an annual 7.1 percent in July from a revised 2 percent gain in June. However, some economists warn that wage growth is set to slow in coming months. "The summer bonus season ends in August, and...

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Pakistan's promises to IMF in doubt as protests sap economy

Pakistan's promises to IMF in doubt as protests sap economy

Anti-government protests that have gripped Islamabad since mid-August could throw off course economic reforms Pakistan promised to deliver in return for an IMF bailout, senior officials said, raising the risk of a sovereign rating downgrade. The International Monetary Fund (IMF) saved Pakistan from possible default last September by agreeing to lend $6.6 billion over...

Amid foreign crises, Obama takes solace in US economic turnaround

Throughout much of his presidency, Barack Obama has been under siege about the state of the US economy. But with economic growth now far more robust than when he took office, he is finding some measure of solace on the domestic front while a number of crises rage abroad. With his handling of foreign policy under fire in confronting challenges from Ukraine to the Middle East, Obama made a Labor Day trek to Milwaukee's annual Laborfest event to underscore how he...

Basel III deposit challenge looms over Islamic banks

Basel III deposit challenge looms over Islamic banks

As banks around the world gear up to meet tough Basel III regulatory standards, Islamic lenders face a source of uncertainty that could prove expensive for them: how regulators will treat their deposits. In most ways, Islamic banks look well-placed to cope with Basel III, which will be phased in across the globe over...

100 days of Modi: Good for business, not so good for marginalised groups

In his first 100 days, Prime Minister Narendra Modi has protected the food security of millions of Indians on the global arena, but early trends suggest his government's pro-business policy will hurt the environment and the poor. In "100 days review of NDA government" – a report released on Tuesday, focusing on issues faced by the country's poor and marginalised - civil society groups delivered a mixed verdict on Modi's coalition National Democratic Alliance (NDA) government, which swept to power...

Published Date: September 2, 2014
State banks slow to go online

State banks slow to go online

The government banks are lagging behind private and foreign banks in introducing online banking for customers, Bangladesh Bank data shows. BB's quarterly report as of June 2014 shows that all 75 branches of foreign banks and 3,632 branches or 99.94 percent of private banks have introduced online banking, gaining an edge over the state banks. A mere 858 branches or 24 percent of the total 3,540 branches of state-owned commercial banks offer online coverage. The situation is more depressing with the state-owned development banks; less than nine percent of their branches have an online facility.   “The government's procurement system is stringent and it takes a lot of time to execute a contract,”...

Published Date: September 2, 2014
Denim makers all set for expansion

Local entrepreneurs are investing heavily in denim, as at least six new factories will come into operation this year to meet growing global demand. “We will start producing an additional one million yards of denim fabric a month in the next three months,” said Kutubuddin Ahmed, chairman of Envoy Group. It produces three million yards a month at present. “I know that five to six other groups have already installed machinery to produce the fabric,” Ahmed added. Currently, he purchases 60...

Published Date: September 2, 2014
Banks' capital falls as defaults pile up

Banks' capital falls as defaults pile up

Banks' overall capital base shrank 1.36 percent in the second quarter of this year compared to the first quarter as the asset quality of state banks deteriorated further. On June 30, the banks' capital was Tk 63,694 crore, which is 10.68 percent of their total risk-weighted assets. The amount was Tk 64,575 crore on...

Published Date: September 2, 2014
Foreign funds in stocks plunge

Net foreign investment in Dhaka stocks fell 84 percent month-on-month in August amid selling pressure for profit-booking among overseas investors. Foreign investors bought shares worth Tk 164.93 crore and sold shares worth Tk 152.47 crore to take net investments to Tk 12.46 crore last month, according to data from the Dhaka Stock Exchange. Stock indices and turnover rose last month, leading foreign investors to offload shares from their portfolio. DSEX, the benchmark index of the premier bourse, went up 25 percent to...

Published Date: September 2, 2014
Govt to make 500 mobile apps in Bangla

The information and communication technology division of the government will make 500 mobile applications in Bangla for the users of Android operating system. The ICT division signed a deal on Sunday with Ethics Advanced Technology Ltd (EATLApps), a local mobile application developer, according to a statement. Android is a popular operating system developed by US-based search engine giant Google. ICT Secretary Nazrul Islam Khan said the government will spend more than Tk 9 crore on the project. The ministry wants to encourage the...

Published Date: September 2, 2014
LankaBangla Securities launches trading software

LankaBangla Securities has soft-launched trading software with Chittagong Stock Exchange to provide direct market access to dealers and investors, it said in a statement yesterday. The software known as Order Management System, launched for the first time in Bangladesh, is different from the exchange-provided application. The system is an open platform to integrate with other stock exchange trading engines. LankaBangla led the market into a new dimension with the software as dealers and inventors can now place orders using real-time technical analysis...

Published Date: September 2, 2014
Booming electric car sales under fire in Norway

Booming electric car sales under fire in Norway

Ministers in Norway -- a major and rich oil-producing country -- are under increasing public pressure to reduce perks and tax breaks for booming electric car sales. "It's become a problem," said Erik Haugstad, a bus driver in the Oslo region who complains about the numerous electric cars clogging bus lanes, which they have...

Published Date: September 2, 2014
Britain's top fund manager to sell HSBC shares on 'fine inflation' fears

One of the UK's most high-profile fund managers, has said he has decided to sell his holding in HSBC, because he is worried about "fine inflation". Neil Woodford said the size of fines in the banking sector seemed to be rising. "Fines are increasingly being sized on a bank's ability to pay, rather than on the extent of the transgression," he said. HSBC was fined £1.14bn by US authorities in 2012, for failing to prevent money laundering. There have been a number of...

Published Date: September 2, 2014
New Apple iPhone to have

Apple Inc plans to enable its next iPhone to become a mobile wallet by allowing owners to securely make mobile payments in a store with the touch of a finger, Bloomberg said on Sunday, citing a person familiar with the situation. The agreement includes participation by Visa Inc., MasterCard Inc and American Express Co and will be announced Sept. 9 along with unveiling of the next iPhone, according to the source, who Bloomberg said asked not to be identified because...

Published Date: September 2, 2014
Nokia, Samsung team up for mapping service

Nokia's mapping service will soon be appearing on Samsung smartphones. A deal between the two will see a test or beta version of an Android app for Nokia's Here maps included free on handsets and the Gear S smartwatch. The move is widely seen as a way to help Samsung distinguish itself from Google which oversees Android. Formerly known as Nokia maps, Here is also used by Yahoo, Amazon and Garmin and it provides map data for Microsoft's Bing search engine. The map...

Published Date: September 2, 2014
Outsourcing firm looks to ride on global growth

Outsourcing firm looks to ride on global growth

A leading outsourcing service provider, ServicEngineBPO, aims to more than double its workforce over the next two and a half years, a top official said. The recruitment drive will create around 600 new jobs at the company's Dhaka office as it expands operations to cater to growing demand for outsourcing services. “We want to exceed...

Published Date: September 2, 2014
China vows to help Zimbabwe: Mugabe

Zimbabwean President Robert Mugabe, returning from a state visit to China, said Sunday Beijing had pledged to assist his southern African country's ailing economy "to the best of its ability". China will "continue to be as friendly to us as it was before ... The support we have asked for in the various areas, China will provide to the best of its ability," Mugabe said in comments carried on Zimbabwe Broadcasting Corporation (ZBC) television after his arrival. Mugabe, who won disputed...

Published Date: September 2, 2014
India's Kingfisher tycoon declared 'wilful defaulter'

The United Bank of India declared flamboyant and indebted tycoon Vijay Mallya a "wilful defaulter" on Monday, dealing another blow to his embattled Kingfisher Airlines. A top official at the bank confirmed the decision, which comes nearly two years after the airline lost its licence to fly when it failed to end a strike by staff who had not been paid. Kingfisher's debts run up to nearly $1.5 billion owed to banks, airports, fuel suppliers, staff and others. Out of this,...

Published Date: September 2, 2014
S Korea exports fall 0.1pc in August

South Korea's exports fell 0.1 percent in August from a year ago due to strikes at major auto plants, state data showed Monday. Exports for August amounted to $46.3 billion while imports rose 3.1 percent to $42.9 billion, leaving a trade surplus of $3.4 billion, the trade ministry said. It marks the 31st consecutive month that South Korea -- Asia's fourth-largest economy -- has posted a trade surplus. Overseas shipments of most key export items including ships and mobile devices rose, while...

Published Date: September 2, 2014
Barclays sells Spanish businesses

Barclays Bank has agreed to sell part of its Spanish business for £633m to the country's third largest lender CaixaBank. The sale includes Barclays' retail, wealth management and corporate banking business in Spain. In a statement, Caixa said the deal involved 270 branches and approximately 555,000 new clients. Barclays is reorganising its business by cutting jobs and selling off parts of its European operations. In May, it announced plans to cut 19,000 jobs by 2016, of which 9,000 will be in the UK,...

Published Date: September 2, 2014
India urges court to leave some coal blocks with companies

The Attorney General has asked the Supreme Court to leave 40 of the 218 coal blocks allocations the court declared illegal with companies that operate mines that are either producing or close to doing so. India's highest court ruled last week that the country's decades-old method of allocating coal mining concessions was illegal and arbitrary, putting investments worth billions of dollars at risk. The suggestion by Attorney General Mukul Rohatgi sent shares of some of the companies that hold coal blocks...

Published Date: September 2, 2014
Russia and China launch gas pipeline

Russia and China have begun the construction of a new gas pipeline linking the countries, with a ceremony in the Siberian city of Yakutsk. China's CNPC has agreed to buy $400 billion (£240 billion) of gas from Russia's Gazprom. Russia will ship 38 billion cubic metres (bcm) of gas annually over a period of 30 years. The deal will lessen Russia's dependence on European buyers, who have imposed economic sanctions because of the crisis in Ukraine. The construction ceremony was attended...

Published Date: September 2, 2014
“Most exciting ever" Novartis drug points to huge sales

Sales forecasts for Novartis's new heart failure drug are being ramped up by analysts after strikingly good clinical trial results for a medicine doctors expect to transform treatment of the deadly disease. Shares in the Swiss drugmaker jumped over 3 percent to a record high on Monday as data for LCZ696 released at the weekend beat expectations, showing the medicine slashed deaths and hospitalisations, worked across all groups of patients, and had no serious side effects. David Epstein, Novartis' head of...

Published Date: September 2, 2014
Samsung to merge shipbuilding, engineering units

The shipbuilding and engineering units of South Korea's Samsung group said Monday they would merge, as the family-run giant gears up for generational ownership succession. The board members of Samsung Heavy Industries, the world's third-largest shipmaker, and Samsung Engineering had approved the tie-up via a share swap, said a joint statement. Shareholders at the engineering unit will be given 2.36 shares in the shipbuilder, it said, adding the deal would be finalised by December. The two firms hope to achieve total sales...

Published Date: September 2, 2014
What's Europe's best hope for avoiding a second euro crisis?

What's Europe's best hope for avoiding a second euro crisis?

This week's theatrical resignation threat by Manuel Valls, the French prime minister, combined with deep European anxiety about deflation, suggest that the euro crisis may be coming back. But a crisis is often an opportunity, and this is the hope now beginning to excite markets in the eurozone. Investors and business leaders are asking...

Published Date: September 2, 2014
China gives Microsoft 20 days to provide explanation in anti-trust probe

A Chinese anti-trust regulator said on Monday it has given Microsoft Corp 20 days to reply to queries on the compatibility of its Windows operating system and Office software suite amid a probe into the world's largest software company. The State Administration for Industry and Commerce (SAIC) questioned Microsoft Vice President David Chen and gave the company a deadline to make an explanation, the agency said in a short statement on its website. Microsoft is one of at least 30 foreign...

Published Date: September 1, 2014
BB brings cheer to foreign investors

Foreign investors having stakes in Bangladeshi private companies will now get higher returns if they sell their shares, as the central bank has introduced globally-accepted approaches to value such firms. Analysts say the move will encourage overseas investment in local companies. Along with the currently practised 'net asset value approach' for determining the repatriable value of shares, Bangladesh Bank has adopted two more methods: market value approach and income approach or discounted cash flow approach. Take an illustrative example under the three...

Published Date: September 1, 2014
Ruposhi Bangla shuts as renovation starts today

Bangladesh Services Ltd (BSL), owner of Ruposhi Bangla Hotel, will transfer 500 employees to other units as the five-star hotel's extensive renovation begins today. The hotel will keep its entire operations closed for the next 16 months for the renovation work. Of the 500 employees, 300 will work at Bangabandhu International Conference Centre, 116 for a project of InterContinental Dhaka, 70 at Balaka Executive Lounge at Hazrat Shahjalal International Airport, and the rest will go abroad for training during the period,...

Published Date: September 1, 2014
MediaVest sets foot in Bangladesh

MediaVest sets foot in Bangladesh

Starcom MediaVest Group has embarked on its journey in Bangladesh with a promise to produce quality media products, a top official of the global advertising agency said yesterday. The subsidiary of Publicis Groupe, the world's third-largest communications group and second-largest media counsel, opened its office in the country in February. It will hold a ceremony at The Westin today to begin formal operations. The US-based media agency is foraying into Bangladesh through a partnership with Grameenphone, the country's largest mobile phone operator, with whom it signed a deal in August. MediaVest works with Telenor, which controls 55.8 percent of GP, across a number of markets around the world. "We have the same partnership...

Published Date: September 1, 2014
Development projects off to a slow start

Development projects off to a slow start

ADP implementation dropped 1 percentage point year-on-year in the first month of the fiscal year owing to slow utilisation of foreign fund. Only 2 percent, or Tk 1,847 crore, of the total allocation for Annual Development Programme (ADP) was used in the month of July -- the lowest implementation rate in four years. Of the...

Published Date: September 1, 2014
IT engineers to get global certificates

Bangladesh is set to become a member of Japan-based Information Technology Professionals Examination Council (ITPEC), paving the way for its IT professionals and graduates to get internationally recognised certificates. Bangladesh will conduct IT engineers examination every year and award such certificates, Telecom and ICT Minister Abdul Latif Siddique said at a press conference at the office of Bangladesh Computer Council (BCC) yesterday. BCC, the state-run institution, already started taking such examinations in April. Japan-based Information Technology Promotion Agency, a regulatory body for...

Published Date: September 1, 2014
Biman introduces two more apron buses

Biman Bangladesh Airlines has introduced two more apron buses to provide better ground handling services at Hazrat Shahjalal International Airport. With the two, Biman has now seven apron buses that are used to transport passengers to and from or within airports. Air Marshal Jamal Uddin Ahmed (retired), chairman of Biman's board of directors, launched the buses at a function at the airport on Thursday. The buses that can carry 70 passengers each with sufficient room for luggage were made in Germany, Biman...

Published Date: September 1, 2014
Stocks fall in thin trade

Stocks declined for the second day yesterday as investor participation in trade declined for a half-day nationwide strike. DSEX, the benchmark general index of the Dhaka Stock Exchange, declined 28.48 points or 0.62 percent, to close at 4,559. DSES, the shariah index of the Dhaka bourse, closed at 1,057 points, after falling 8.75 points or 0.82 percent. “The market declined amid a weak participation by investors. This can be attributed to the nationwide strike,” said LankaBangla Securities. Turnover, the most important indicator of...

Published Date: September 1, 2014
Air Arabia starts Ctg-Ras Al Khaimah flights Tuesday

Air Arabia, the Middle East's first and largest low-cost carrier, will run three flights a week from its new hub in Ras Al Khaimah in the UAE to Chittagong in Bangladesh, beginning Tuesday, the airline said in a statement yesterday. “Air Arabia is delighted to announce the introduction of our new service between Ras Al Khaimah and Chittagong. We have a strong association with Bangladesh having run flights to the country since 2007,” said Adel Ali, group chief executive of...

Published Date: September 1, 2014
Launchpad Bangladesh concludes first season

Launchpad Bangladesh concludes first season

A Bangladeshi web portal— Environmentmove.com—which deals with nature, wildlife, agriculture and environmental issues, became the champion of the first season of Launchpad Bangladesh. The grand finale of the capacity building training boot camp programme for startups took place at the senate building of Dhaka University in the capital on Friday. Launchpad Bangladesh was initiated by...

Published Date: September 1, 2014
GTV gets new managing director

GTV gets new managing director

Aman Ashraf Faiz is set to take charge of Gazi Satellite Television as managing director today, the company said in a statement yesterday. Faiz has extensive work experience of over 15 years in local and international organisations in brand building, media channel management, brand activation, rural marketing, marketing research and PR management, the company said. He has previously worked with Unilever Bangladesh and Grameenphone, according to the statement. “I am extremely thankful to the Gazi family for giving me the opportunity to work for the television industry of the country,” Faiz said of his appointment. “I am starting my journey to bring great television screen for the audience of Gazi Satellite Television.

Published Date: September 1, 2014
India court should decide fast on coal mine fate: Jaitley

India court should decide fast on coal mine fate: Jaitley

India's Supreme Court needs to decide fast on the fate of nearly 220 coal blocks it has declared illegal, India's Finance Minister Arun Jaitley said Saturday, as the nation grapples with already bad fuel shortages. The court will hold a hearing Monday to consider what to do with the 218 coal licences awarded to...

Published Date: September 1, 2014
India better prepared for US Fed rate hike: Rajan

India better prepared for US Fed rate hike: Rajan

India is better prepared to handle the impact of interest rate increases in the United States as foreign funds are less likely to desert the country due to signs of an upturn in economic growth, the Reserve Bank of India (RBI) chief said in an interview published on Sunday. RBI Governor Raghuram Rajan's comments...

Published Date: September 1, 2014
Swatch prefers go-it-alone route for smartwatch plans

Swatch Group is happy to go it alone with a launch next year of watches with "smart" features to compete with so-called wearable gadgets from the big tech companies, a market potentially worth $93 billion. The world's biggest watchmaker, which sees the advent of smartwatches as an opportunity rather than a threat, will unveil its new Swatch Touch next summer. Swatch Chief Executive Nick Hayek said these new watches might allow the wearer to count the number of steps they take...

Published Date: September 1, 2014
Indonesia grapples with fuel subsidy storm

Just weeks before Joko Widodo takes office, a ham-fisted attempt by the state energy firm to tackle huge fuel subsidies has sparked panic buying and highlighted the most pressing economic issue confronting Indonesia's next president. The subsidies are a perennial dilemma for Indonesian leaders -- economists have long decried the expensive payouts as unsustainable, yet cutting them is hugely unpopular, and has in the past sparked violent protests. But with economic growth slowing, observers say Indonesia can little afford to keep...

Published Date: September 1, 2014
Carmakers force the smiles at Russia's car show

The latest models gleam at the Moscow car show, but Russian sales have dropped because of the Ukraine crisis and the shine has gone off a key growth market. Hostesses in cocktail dresses and high heels fawn over the cars as they do every year, and sober-suited executives boast about the newest features, but the smiles seem somewhat forced at this edition of the Moscow International Automobile Salon. More than one million people are expected to visit the show, which closes...

Published Date: September 1, 2014
EU could send over €1b more aid to Ukraine

The European Union may disburse more than one billion euros in loans to Ukraine over the coming months and could consider further aid beyond that, European Commission President Jose Manuel Barroso said on Saturday. In March, the EU offered an 11 billion euro ($14.45 billion) package of loans and grants to Ukraine over the next several years to help get the shattered economy back on its feet. Ukraine has been caught in a geopolitical tug of war between the EU and...