Debtors, money launderers must be speared

Bangladesh's foreign exchange reserves have been falling since quite a long time. One of reasons for this decline is trade manipulation. Money is being smuggled abroad through manipulative trading practices which is a matter of discussions everywhere. According to the Bangladesh Economic Association, a total of eight lakh crore taka have been smuggled abroad since the independence.

Manipulative trading practices is one among the multiple ways to launder money abroad. Hundi is another financial instrument to take money out of country. Trade manipulation is a type of trade abuse where there is a deliberate attempt to import low-priced goods at a show-off higher price. As a result, a large amount of cash goes out of the country. This is called over invoicing. Sometimes money is laundered through under-invoicing by showing low prices of high-priced products. In this way, the government is deprived of its duties in the case of import and export, on the other hand, the money of the country goes abroad.

Again, many times there is an announcement of import-export of goods but in reality empty containers come and go. In order to bring back this money, the government has given the opportunity to turn the black money white many times. But not much benefit came.

The cost of importing capital equipment in the country is increasing day by day. Delayed repayment of old letters of credit (LC) and increase in equipment prices are being blamed as the reasons behind this. But economists say that such a big jump in the import cost of capital equipment cannot be justified by these two factors alone. They suspect that a huge amount of money has been laundered through over invoicing. At the same time, they raised questions about the inaction of the commercial and financial sector regulatory bodies in this regard.

Bangladesh Bank itself has said that there has been massive over-invoicing in import credit. The central bank suspected over-invoicing of at least 20 to a maximum of 200 percent in last year's loan notes. Such trend is still ongoing. Therefore, economic analysts say, Bangladesh Bank and NBR need to look into the matter very carefully. Because most of the capital equipment is imported at zero duty. So there is a big chances of over invoicing. It is necessary to be clear about the issues by carrying out an inquiry program on where the imports are and at what prices.

Again, it has been seen that some big industrial groups have profit-making industries, but they default on bank loans. One of the reasons for this is the illegal transfer of profits abroad.

Money laundering and defaulted loans are largely blamed for the crisis in the country's economy. Yet it is not clear why the government is pursuing a lenient policy against defaulters and money launderers. In most cases, money launderers and defaulters are politically and socially influential. As a result, the stakeholders feel that there is a lack of effective action by the government to recover these defaulted loans and bring money back from abroad.

Every stimulus of the economy is deeply interrelated with each other. Due to which money laundering of defaulted loans has increased in the country and the legal income of expatriates is also decreasing. Along with this, the demand for dollars in the open market is increasing. For which the reserve is rapidly decreasing. Therefore, there is a danger of extreme economic crisis in the country if effective and strict measures are not taken immediately against defaulted loans, corruption and hundi system.