By The Bengali Roots Desk
A Surprising Turn in Bangladesh’s Dollar Story
For months, “dollar crisis” dominated headlines. Banks struggled, importers worried, and foreign debts piled up.
But now, in a striking shift, Ahsan H. Mansur, Governor of Bangladesh Bank, says the narrative has changed.
Bangladesh, he insists, is no longer facing a dollar shortage.
Instead, the country is witnessing a stabilisation of foreign currency supply and a determined push to clear outstanding foreign debts within the next two months.
From Shortage to Surplus
While liquidity in cash remains tight across banks, the supply of US dollars in the interbank market has improved significantly.
According to Dr Mansur:
- Banks are now holding dollar surpluses.
- Remittances from expatriates are flowing in.
- Export earnings are being deposited regularly.
- Demand for holding dollars has declined.
- The local currency is offering higher interest returns.
These changes, combined with measures to curb money laundering and reduce corruption, have boosted dollar availability in the interbank market.
Over the past two months alone, Bangladesh has repaid $1.5 billion in foreign dues without dipping into foreign exchange reserves.
Instead, the dollars were sourced directly from commercial banks.
How the System Worked
Traditionally, the Bangladesh Bank would supply dollars from its reserves when banks faced shortages.
But this time, the mechanism was different.
Dr Mansur explained that some banks, including Islamic Bank, experienced a surge in remittance inflows, creating dollar surpluses but cash shortages. The central bank instructed Sonali and Rupali Banks to exchange local-currency cash for the excess dollars.
Those dollars were then used to settle fertiliser-related foreign debts.
In short:
The interbank market financed repayments, not the national reserves.
Clearing the Debt Burden
Under the previous administration, Bangladesh accumulated more than $2.25 billion in unpaid dues to major international companies, including:
- Adani Group
- KAFCO
- Chevron
- Bangladesh Petroleum Corporation
Within just two months, most of this debt has been cleared.
Only $400 million remains outstanding, a figure the governor expects to eliminate by December.
Quote Box
“Substantial payments have been made for fertiliser, electricity, and to companies like Adani and Chevron. Our goal is to eliminate this debt within the next two months, which will boost liquidity in the market.”
Dr Ahsan H Mansur
Why the Dollar Market Improved
Dr Mansur attributes the turnaround to:
- Stronger enforcement against money laundering
- Reduced corruption
- Stabilising inflation
- Lower speculative demand for dollars
- Reduced uncertainty over imports of oil, gas, and fertiliser
Bangladesh spent approximately $9 billion last fiscal year importing petroleum products, including oil, gas, and coal. The country also relies heavily on imported electricity and fertilisers, making dollar stability critical.
With external dues shrinking from $2.5 billion to $400 million, financial strain is easing.
What Comes Next?
The Governor struck a cautious but optimistic tone.
He urged patience, signalling that this is not yet the time to aggressively focus on expansion or investment. Stabilisation comes first.
At the same time, the government is preparing to secure an additional $10 billion in loans from international partners.
Dr Mansur indicated that:
- $2–3 billion from the IMF
- $2 billion from the World Bank
could significantly accelerate economic activity once secured.
If current trends continue, he believes the economy will move onto a more positive trajectory by year-end.
A Shift in Confidence
For a country that only recently battled severe dollar stress, this development marks a meaningful psychological and structural shift.
The question now is not whether dollars are available but whether Bangladesh can sustain this momentum while strengthening institutional discipline.
The next two months may determine whether this stabilisation becomes a lasting recovery.
Editor’s Note
Bangladesh’s economic narrative is evolving. While structural vulnerabilities remain particularly important, and global market pressures, the recent improvement in dollar liquidity signals a potentially pivotal moment.
If debt clearance proceeds as planned and reforms continue, the country may enter 2026 with renewed financial credibility.
At The Bengali Roots, we will continue to track how policy decisions today shape Bangladesh’s economic future.
