In the first three months of the current fiscal year, Bangladesh's export earnings rose by 7 percent to $11.85 billion, while import spending rose by 15 percent to $19.33 billion. As a result, the trade deficit stood at $7.48 billion.

A major reason behind the rise in import spending is the increase in fuel costs. In July-September of the current fiscal year, this spending was $4.22 billion, which doubled compared with the same period last year.

In this regard, Dr. Mahfuz Kabir, research director at BIISS, said there are two reasons behind the rise in import spending—first, fuel prices have increased; second, shipping costs and insurance costs for transporting fuel have also risen. A somewhat larger quantity of fuel is being imported and at the same time the price is higher, so spending in this sector has increased.

Remittances sent by expatriates help cover the trade deficit. Although $8.59 billion came in July-September, it did not cover this deficit, because Bangladesh's net foreign aid and new loan receipts declined in those three months. As a result, the overall balance of external transactions had a deficit of $1.16 billion, which was covered from reserves. This reduced reserves and raised the dollar price, which is now Tk124.34.

Dr. Mahfuz Kabir further said that although the taka had appeared to strengthen against the dollar in the interim, dollars now have to be bought at Tk128 to Tk129 per dollar on the open market. This means the supply of dollars in the market is low. Although export earnings have remained fairly stable, remittance flows have declined somewhat because instability in the Middle East and the war situation have not ended.

According to Bangladesh Bank data, reserves at the end of September were $31.19 billion, enough to cover five months of import spending. But by November 5, it had fallen further to $29.98 billion.