Trade deficit in the first six months (July-December, 2014) of the current fiscal year of 2014-'15 widened against that of the same period last year.
The gap between the export and import during the period rose to 59 per cent from below 30 per cent earlier. The trade deficit in the service sector was 26 per cent.
Trade deficit is an economic measure of a negative balance of trade in which a country's imports exceed its exports.
The trade gap in the service and industrial sectors are going to create a negative impact in the balance of payments (BoP).
Dr. Atiur Rahman, Governor of Bangladesh Bank (BB), said that fuel and foodstuff prices decreased in the international market. This has led to a fall in export from the country.
During the period country's import was $2,004.90 crore and total export was $1473.50 crore. The deficit stood at $531.40 crore. This information is gathered on the basis of Freight on Board (FoB).
Under the FoB, the seller pays for transportation of goods to the port of shipment, plus loading costs. The trade deficit in the service sector was $156.40 crore against expenditures worth of $407crore. So trade deficit was $250.60 crore.
This time of the number of total projects registered with the Board of Investment was 467. Among these 57 were Foreign Direct Investment (FDI) projects and 609 were internal projects. The total project investment was $5197.073 million that created 99125 jobs.
Experts told this correspondent that import during the period was more than the export during the period.
However, concerned people attributed the increase in trade deficit to a sense of uncertainty that prevailed among the business people and investors since the January 5 elections in 2014. The ongoing non-stop blockade and hartals also triggered the gap in January of 2015.
Amid the situation the import of capital machinery declined by almost fifty per cent in January this year from that of the end month of 2014 due to political standoff. The BNP-led 20-party alliance enforced the non-stop countrywide blockade and hartals since January 6, 2015.
The capital machinery import in December last was $240 million. It dropped to $130 million in January 2015, said officials of Bangladesh Bank, the central bank of the country.
Mahfuzur Rahman, Executive Director of Bangladesh Bank said, "There has been negative impact on trade on export and capital machinery import due to the political unrest. Political unrest is a problem. If the current political violence is stopped, then economy will rebound," he said.
The flow of foreign FDI in Bangladesh rose in 2014 although the political unrest over the January 5 elections marked the beginning of the year. In 2014, the number of internal projects was 1,432 and foreign projects 123, totalling 1555 for proposed investment. The investment proposal involved Tk 536347.194 million. Of these, internal proposals were worth of Tk 647960.579 million and foreign investment Tk 73406.615 million. A total of 2,50866 jobs were created during the period.