Business leaders and bankers Saturday urged the government to take measures immediately to amend the 64-year-old Foreign Exchange Regulations Act (FERA) to facilitate the countrys foreign trade and investment.

They placed the demand at a dialogue on new foreign exchange regulations to facilitate trade and investment.

The International Chamber of Commerce – Bangladesh (ICCB) organised the programme at Bangabandhu International Conference Centre.

ICCB President Mahbubur chaired Rahman the dialogue.

Commerce Minister Muhammad Faruk Khan assured the business community and bankers that he would place the recommendations of the programme to the highest authority of the country.

“The act will be amended through consultations with the stakeholders, including the business community, to make it user-friendly,” the commerce minister said while speaking as the chief guest of the dialogue.

He also appreciated the role of ICCB in organising the dialogue with a view to updating the act.

In his address of welcome, ICCB President Mahbubur Rahman said in the present context of free market economy, it is essential to update the FERA in such a way that it becomes more user-friendly.

The amended act should contribute to the growth of the economy, without compromising the basic interest of the country, he said.

The Guidelines for Foreign Exchange Transactions (GFET) — 2009, issued by the central bank, still have some grey areas. Such areas require clarifications or specific directions of the Bangladesh Bank (BB), he added.

“Bangladesh has liberalised foreign exchange rules for foreign investment. But, there are various restrictions for the local investors, except banks, having expertise in respective field of operations, to invest in a third country. As a result, we are losing the prospect of earning more foreign exchange,” Mr Rahman noted.

So, provisions should be included in the updated act for allowing Bangladeshi entrepreneurs to invest in a third country by setting up industries, offices or branches for expansion of their businesses, he said.

“There have been a number of restrictions on the use of internet transactions, including use of international credit cards. This has to be simplified and made user-friendly to encourage transparent use of foreign currency,” the ICCB chief added.

The revised FERA should allow the local exporters to sell their short-term account receivables to overseas buyers at competitive rates under contract-based export, said Mamun Rashid, Chairman of ICCB Standing Committee on Banking Technique and Practices.

He presented a keynote paper titled Regeneration of FERA and FX Guideline: The Prime Need of the Hour at the dialogue.

“This is high time we should shift our focus from hoarding foreign currency to facilitating international trade for the sake of the economy,” Mr Mamun said.

The revised act should reflect the business communitys rational expectations, he said.

He also said India repealed its FERA 1973 with Foreign Exchange Management Act (FEMA) – 2000.

Currently, a nine-member committee is working to prepare the draft of the modified act. It is likely to be submitted to the finance ministry by the end of this month.

“We are now preparing the draft with amendments,” a member of the committee told the FE.

SAARC Chamber President Annisul Huq sought a target-bound commitment from the government to update the FERA for facilitating the countrys international trade and investment.

The President of the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI), Major General (Retd) Amjad Khan Chowdhury said the existing FERA is holding back the countrys economy.

Bangladesh is a country with food deficit, he said, adding that the local entrepreneurs should be allowed to invest in agriculture sector in different countries, including Myanmar, to help ensure the countrys food security.

World Bank Senior Economist Zahid Hussain said Bangladesh has achieved notable developments in export and remittance earning during the last three decades despite various limitations in the foreign exchange regulations.

Among others, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Fazlul Haque, former president of the Dhaka Chamber of Commerce and Industry (DCCI) Abul Kashem Khan, former chairman of National Board of Revenue (NBR) M A Mazid, Managing Director of Pubali Bank Limited Helal Ahmed Chowdhury, and Barrister Rafique Ul Huq also spoke on the occasion.

A number of business leaders, along with managing directors, chief executive officers and senior officials of commercial banks, financial institutions and corporate entities, also participated in the programme.