The government is considering converting the existing dollar bonds into multi-currency investment tools to attract more non-resident Bangladeshis (NRBs) to the state-run investment scheme, officials said.
In a recent meeting, the Cash and Debt Management Committee has taken the decision to introduce the instruments, so that the NRBs can invest in the state-owned savings instruments through pound sterling and euro apart from the US dollar, they added.
Currently, the NRBs can only invest in the US Dollar Premium Bond (UDPB) and the US Dollar Investment Bond (USIB) through the US Dollar.
Besides, they are entitled to invest in the existing Wage Earner Development Bond (WEDB) through BDT.
The Finance Division, the Bangladesh Bank (BB) and the Department of National Savings (DNS) are working to convert the existing dollar bonds into multi-currency ones, including pound sterling and Euro.
When contacted, DNS Director General Shamsunnahar Begum said, "We are working on introducing multi-currency investment bonds for the NRBs."
"After developing necessary software in this regard, we will incorporate the decision in the existing policy," she added.
The government introduced three bonds, especially for the NRBs, years ago with an aim of enhancing remittance inflow.
However, the tools were not that much attractive to the NRBs, and could not make a significant headway so far, said an official of the Finance Division.
A large number of the NRBs, staying in the UK and the European Union (EU), a political and economic block of 27 countries, are being deprived of investing in the existing NRB bonds.
The volume of investment in the savings tools will increase manifold, if the government introduces multi-currency bond, he noted.
The government has taken the decision to increase investment in the savings scheme by the NRBs.
The meeting has instructed the Finance Division, the BB and the DNS to take necessary steps in this connection, he added.
Presently, the government is providing a 2.0 per cent incentive on sending remittance.
On the other hand, it is providing interest at 16 per cent against investing in the existing bonds.
The government introduced WEDB in 1981, and UDPB and USIB in 2002. The sale of bonds was stopped from July to December in 2010.
The expatriates have so far invested around Tk 110 billion in three investment bonds. It is contributing to increase the country's foreign exchange reserve.
The government and the central bank have taken various regulatory and institutional measures to boost investment flow through the bonds.
CIP benefits are available by investing in the bonds. Besides, income from the bonds is tax-free.
Moreover, the BB has allowed loan facility of up to 75 per cent of the NRBs' bond holdings. They are also allowed to get housing loans from commercial banks.
