IMF help might not come if reserves decline to USD 10b: Rehman Sobhan

Economist Rehman Sobhan has said the economy is likely to fall into danger if foreign exchange reserves continue to decline. Even the International Monetary Fund (IMF) help might not come forward if the country’s forex declines to USD 10 billion.

The way Bangladesh’s foreign reserve is shrinking is akin to Sri Lanka, Rehman Sobhan said, adding that the economy of Bangladesh is undoubtedly better than Sri Lanka.

Explaining this stance, Center for Policy Dialogue (CPD) chairman Rehman Sobhan said, “We have a big export sector. Alongside that, there is remittance or expatriate income, which is much higher than Sri Lanka."

He made these remarks at an event titled "Conversation with Professor Rehman Sobhan" organised by the Economic Reporters Forum at its office in Dhaka.

He said inflow of remittance has decreased in the country but it does not mean that the expatriate income actually decreased. Rather the remittance is coming through informal channels such as Hundi. That means, instead of being deposited in the Bangladesh Bank, reserves are being deposited outside the country.

He said this has become convenient for those who launder money abroad.

The noted economist said loan defaults have become the new normal in the country and those who are doing it are identifying themselves as big politicians.