Trade deficit shoots up 53pc in Jul-Apr

Bangladesh's trade deficit shot up 53 per cent year-on-year to $27.5 billion in the July-April period of the current fiscal year as the surge in imports continued against lower export receipts, exceeding last year's total shortfall.

Bangladesh paid $68.67 billion in import bills in the 10 months ending in April, when export earnings stood at $41.10 billion, according to data released by Bangladesh Bank.

The amount of deficit originating from the nation's overseas trade crossed the previous peak of $23.7 billion, registered last fiscal year, thanks to spiralling import bills resulting from soaring commodity prices in the international market for supply chain disruptions and war in Ukraine.

With its inadequate domestic production, Bangladesh has to import a number of key commodities, namely wheat, edible oil, sugar and pulses. The nation also has to import petroleum, industrial raw materials and intermediate goods to run both its domestic market and export-oriented industries.

Imports, which slowed in the last two months, were still 41 per cent higher year-on-year in the July-April period whereas exports grew 35 per cent at the same time.

The gap against the backdrop of a drop in the inflow of remittance, a major pillar of Bangladesh's $465 billion economy, worsened the availability of foreign exchange to finance imports and increased pressure on once comfortable foreign exchange reserves.

Current account deficit ballooned over nine times year-on-year to $15.30 billion, the highest on record, in the July-April period of the current fiscal, central bank data showed.

The previous widest deficit in the current account was the $9.56 billion recorded in FY18. The amount of imbalance was $4.5 billion last fiscal year.

Overall balance with regard to the external account also became negative until this fiscal year from positive balances in the last two fiscal years, according to the data.