Attracting NRB funds into capital market
Thursday, 24 July 2008
NON-Resident Bangladeshis (NRBs) have been contributing significantly to the economy of Bangladesh. Unfortunately, most part of remittance funds is being utilized for consumption purpose and real estate investment, while only an insignificant portion of those funds are being used in the financial market for economic activities. Like other neighboring countries (e.g. Pakistan and India), our NRBs should also be encouraged to place their funds directly in the capital market, which will certainly strengthen our overall financial market.
There is a provision laid down in 'Guidelines for Foreign Exchange Transactions, Volume-1' [Chapter 14, Section-I(4)] of Bangladesh Bank for securities transactions by the non-residents through Non-resident Investors Taka Account (NITA). But practically, NRBs could not take the fullest advantage of these provisions due to some operational constraints/ requirements. We strongly believe, simplification of the same will bring significant flow of foreign currency to the country.
To develop our capital market, NRBs should be encouraged to actively participate in the secondary market by resolving the factors involved in transferring money through the banks.
The issue needs to be addressed immediately. We hope, as soon as the fund transferring problems are resolved, the CSE Internet Trading Module can perform effectively to channelise this money into the Bangladesh capital market.
Abdul Wahab
Qatar
There is a provision laid down in 'Guidelines for Foreign Exchange Transactions, Volume-1' [Chapter 14, Section-I(4)] of Bangladesh Bank for securities transactions by the non-residents through Non-resident Investors Taka Account (NITA). But practically, NRBs could not take the fullest advantage of these provisions due to some operational constraints/ requirements. We strongly believe, simplification of the same will bring significant flow of foreign currency to the country.
To develop our capital market, NRBs should be encouraged to actively participate in the secondary market by resolving the factors involved in transferring money through the banks.
The issue needs to be addressed immediately. We hope, as soon as the fund transferring problems are resolved, the CSE Internet Trading Module can perform effectively to channelise this money into the Bangladesh capital market.
Abdul Wahab
Qatar