BANGLADESH

The administration has declared high alert in Rangamati after two deaths in the hill tracts flared unrest.

"The law enforcement agencies have been asked to be on high alert to avoid unwanted incidents, since the situation in the district has become somewhat sensitive," Rangamati superintendent of police Masud-ul Hasan said on Wednesday night.

He said the alert may last two to three days.

Earlier, the administration imposed Section 144 in Baghaichharhi, banning all sorts of gathering, following tension between the ethnic minorities and the Bengali settlers.

A woman of ethnic minority origin was killed in Khagrachharhi's Dighinala in the morning reportedly by Bengali settlers agitated at the 'murder' of a Bengali motorcyclist.

The body of Abdus Sattar, 27, the motorcyclist, was found in Rangamati's Baghaichharhi area.

The settlers in Dighinala took out a procession protesting the killing of Sattar, who was from Kabakhali's Muslimpara area.

At one stage of demonstration, they hurled brickbats on a jeep carrying passengers from ethnic minorities, police told 

Chigon Mila, 43, who was injured in the attack, died in Khagrachharhi Sadar Hospital around 10:30am, they said.

The two political groups in the hill tracts have blamed each other for the incidents in separate statements.

Trade deficit in the first four months of the fiscal year has nearly doubled the deficit of the same period last year.

The export-import gap in July-October period was $ 3.103 billion, a figure that was $1.825 billion in the same period last year.

The deficit shot up in September and October as import costs jumped, with little growth in exports.

Experts say the current fiscal's deficit may exceed the previous fiscal year's deficit.

"Basically the rise in fuel oil import increased the trade gap," former advisor to the caretaker government A B Mirza Azizul Islam said.

More furnace oil and diesel were needed for the power plants, he said. "So, the import costs grew."

The rise in import cost has also created pressure on the forex reserve leading to devaluation of taka against US dollar, Azizul said.

"Now a dollar costs over Tk 80. So the cost of imported products has also risen. The heightening inflation has further escalated," he added.

According to Bangladesh Bank, the country's import cost in the first four months of the current fiscal year was $ 11.283 billion while the export earning was $ 8.18 billion.

In the same period last financial year, the country imported products worth $ 8.562 billion and exported products worth $ 6.737 billion.

In 2011-12 fiscal year, the trade deficit was $ 7.328 billion, a record high.

"Import costs look unlikely to fall in the near future. But the export earning bodes a negative trend.

"In this situation, Bangladesh will face a trade deficit, which is higher than the previous year's," said Mostafizur Rahman, executive director of the independent think tank Centre for Policy Dialogue.

"The government is compulsively increasing prices of fuel oil to cut subsidies as fuel oil import cost costs rose," he said.

In the first two months (July-August) of the current fiscal year, the trade deficit was $ 409 million, which is $ 375 million lower than that of the same period in the previous fiscal.

But in September-October, the trade deficit rose to $ 2.7 billion, nearly seven times higher than the deficit in July-August.

The import costs rose 31.78 percent in the first four months of the current fiscal year while the export earnings rose 21.42 percent.

According to the central bank, the rate of opening Letters of Credit (LC) to import fuel increased by 116 percent in July-October while the rate of clearing LCs increased by 82.53 percent.

In the same period last year, the rate of opening LCs to import fuel oil fell by 11.79 percent, but the rate of clearing increased by 78.41 percent.

The export earning and import cost increased at almost the same rate in 2010-11 fiscal year. The import cost increased by 41.79 percent and the export earnings increased by 41.47 percent that year.

The CPD researcher said readymade garments, the major export product of Bangladesh, were exported at higher prices last year as prices of cotton and yarn was high.

"The country earned more through export that year."

"But prices of cotton and yarn have since then fallen to one third. Prices of garments decreased, too. The growth of export earning therefore appears unlikely to be as high," he said, adding that it will not harm the exporters.

Note: The prices of traded products shown in the Trade Balance Chart of the Bangladesh Bank exclude charges like insurance. The charges were added to the service sector.

–Impress Telefilm, a leading TV production house in Bangladesh, did not deduct tax at source during 2006-07 fiscal, leading to loss of Tk 61.19 million for the government, a CAG report has revealed.

The comptroller and auditor general's (CAG) office, after screening the documents at the Large Taxpayers' Unit of National Board of Revenue (NBR) for 2006-07, found that the company did not properly deduct tax at source during that financial year.

The CAG has recommended the tax office to recover the money.

The report noted that as per VAT Act, 1991, after receiving service clients must deduct tax at source and submit the money to the exchequer, no matter how the products are purchased.

"(But) in this case the company did not deduct tax at source properly and submit it to the exchequer," the report said.

The report detailed that in 2006-07 fiscal the company enjoyed services such as motorcar workshop, printing, consultancy, security, and repair and maintenance but did not deduct tax at source.

'PENDING WITH NBR'

Finance director of Impress Zahiruddin Mahmud Mamun told  that the issue is pending with the appellate court of the NBR.

He said it is not practical to collect VAT from all service providers. "They are saying I did not deduct VAT for repairing cars at workshop. But how can I collect VAT chalaan from the workshop?" he asked.

"VAT is applicable when a person buys a pack of cigarette from retail store but no one pays the Value Added Tax," he said. "I want to pay tax – as a matter of fact, my company pays Tk 8 million to Tk 10 million tax per month -- but there must be a taxpayer-friendly system in place," he added.

Impress Telefilm is engaged in a wide range of activities, including production of drama and drama serials, music videos, variety shows, magazine programme, musical programme, documentaries and TV commercials.