The country's overall trade deficit widened by 65.16 per cent to $3.921 billion in the first nine months of this fiscal due to price hike of essential items, including fuel, in the global market.
"Higher prices of most of the essential items, including food grains and fuel, in the international market have pushed the trade deficit further higher," a senior official of the Bangladesh Bank (BB) told the FE.
He also said the overall trade deficit may ease in the coming months due to a falling trend in import of food grains, including rice, because of a seasonal impact.
The central bank officials, however, expressed worries about volatility in the global oil market saying that the price rose to over US$128 a barrel Friday and it has become a major concern for the government.
"The trade deficit may increase further if the prices of petroleum products continue to rise in the international markets," another BB official observed.
The overall trade deficit rose to $3.921 billion in July-March period of fiscal 2007-08 from $2.374 billion during the corresponding period of the previous fiscal.
During the period, export earnings stood at $10.045 billion against the import payments of $13.966 billion, according to the central bank statistics.
"Despite larger deficit in trade balance the current account balance recorded a surplus of $390 million during July-March, 2007-08 against the surplus of $605 million during July-March, 2006-07 due mainly to larger current transfers of $6.233 billion," the central bank said in its Major Economic Indicators: Monthly Update for May, 2008.
The overall balance of payments, however, recorded a surplus of $215 million at the end of March last as against a surplus of $809 million during the same period of the previous fiscal due to surplus in capital account and current account amounting to $390 million and $358 million respectively, the Update said.
"The country's overall balance of payments is maintaining a surplus trend due to higher inflow remittances and foreign aid," the BB official noted.
The remittance crossed $7.0 billion in the first eleven months of the current fiscal, marking a 31.14 per cent growth over the same period of the last fiscal.
The country received $7.163 billion from expatriate Bangladeshis during the July-May period of fiscal 2007-08 against $5.462 billion in the same period of the previous fiscal, the central bank said.
Meanwhile, the flow of net foreign direct investment (FDI) rose to $604 million during the period from $602 million of the corresponding period of the previous fiscal.
The portfolio investment witnessed a significant rise to $66 million in the period from $49 million of the same period of the last fiscal, the BB's data showed.
However, the net receipts of foreign aid recorded higher at $877.74 million during the period against $537.52 million of the corresponding period of previous fiscal, thanks to huge donors' assistance for the floods and cyclone victims, they said.
