Even as Bangladesh continues to deal with depleting forex reserves, former Chief Economist of the World Bank’s Dhaka office, Zahid Hussain, raised concerns regarding the mismatch between the actual calculation of foreign exchange entering and leaving the country.

He pointed out that the decline in reserves is attributable to a deficit in the balance of payments or transaction balance, leading to net foreign exchange reserves falling below US $ 18 billion according to BPM-6 standards.

Zahid Hussain shared this information during his address at the annual conference of the International Business Forum of Bangladesh (IBFB) held at a hotel in capital Dhaka recently.

The Indian High Commissioner to Dhaka, Pranay K. Verma, served as the chief guest at the event.

Hussain highlighted that one of the key factors contributing to the overall macroeconomic instability of the country is external, particularly the fluctuating price of the US dollar. In 2021, the exchange rate of the US dollar remained below Taka 100. However, by September 2022, it had risen above Taka 100 and currently stands above Taka 110, despite a slight decrease.

Expressing his concern, Zahid Hussain noted that the discrepancy between the account of foreign currency inflow and outflow does not align with the country’s reserve levels.

He explained that while such calculations can fluctuate between positive and negative, it has been consistently negative for Bangladesh recently, indicating that there may be undisclosed factors at play.