Mukti

সাতকাহন

Seven trashes collected by the senses.

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সাতকাহন

Seven trashes collected by the senses.

(more…)

Comments Off on সাতকাহন

সাতকাহন

Posted in culture, development, economics, macro, micro, politics, society, trade, TV by jrahman on March 16, 2012

Seven trashes collected by the senses.

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How does the Indian slowdown affect Bangladesh?

Posted in macro, trade by jrahman on January 17, 2012

Indian economy may be in a bit of rough spot.  After a spate of bad news, the rupee slumped against the dollar in November.  Then the government officially acknowledged an economic slowdown, while making a case that the fundamentals remain intact.

What does this slowdown mean for Bangladesh?

Not much, directly, as far as the production side of the economy is concerned.  After all, as Bangladeshis never tire of pointing out, Indians don’t buy Bangladesh stuff.  With about 2% of its export going to India, any slowdown there isn’t likely to matter much for Bangladeshi producers.

But there might be good news for the households.  Food prices in India are on the wane.  That’s likely to affect prices in Bangladesh.  Further, as the rupee falls against taka, inflationary pressures should ease.  In fact, rupee had already fallen by over 10 paisa against taka between July and November.  This was accompanied by food price inflation in Bangladesh easing to 10.4% in the year to December, compared with 13.4% in the year to July.  Rice price isn’t likely to fall to 10 taka a kg, but if the rupee falls further, there will be some respite on the prices front (assuming, of course, all else equal — which might not be the case thanks to Messrs Muhith and Ataur Rahman).

There is, however, another channel through which Bangladesh might be affected.  What if the slowdown proves sharper and more prolonged than currently believed?  What if India has a hard landing?  There is no statistics, official or otherwise, about the undocumented Bangladeshis working in India.  But there is no question that if the Indian economy seriously falters, it will have an impact on these folks.  Perhaps the result will be a return of the monga?