Monetary policy does not reflect growth-oriented fiscal measures: Dhaka Chamber

The Dhaka Chamber of Commerce and Industry (DCCI) today said the growth-oriented fiscal measures announced by the government are not reflected in the new monetary policy unveiled by the central bank.

The leading trade body said the government has offered various tax and duty incentives for fiscal year 2026-27 aimed at expanding businesses, encouraging private investment and accelerating industrialisation.

However, these growth-oriented fiscal measures are not reflected in the new monetary policy, indicating a clear lack of coordination between fiscal and monetary policies, the DCCI said in its reaction to the monetary policy for July-December 2026.

The Bangladesh Bank (BB) unveiled the policy at a press conference at its headquarters today, keeping the policy rate unchanged at 10 percent to tame persistent inflation, which has remained above 8 percent on average for four years since fiscal year 2022-23.

The DCCI said that despite private sector credit growth falling to 5 percent in May 2026, the decision to keep the policy rate unchanged is "highly disappointing for the business community".

It said maintaining a high policy rate continues to limit the scope for reducing the cost of borrowing for businesses.

The chamber said inflation has not been brought down to the desired level even though the authorities have been pursuing a contractionary monetary policy.

The DCCI, however, welcomed the Tk 60,000 crore refinancing and incentive package announced by the BB to revive business activities.

"However, drawing lessons from past experience, it is imperative to ensure the transparent, efficient and effective implementation of this fund," it said.

The trade body said cottage, micro, small and medium enterprises, export-oriented industries and other productive enterprises that have already been severely affected and are struggling to survive should be able to access this facility through simplified eligibility criteria, minimal documentation requirements and a faster approval process.

The chamber also expressed "serious concern" over the government's increasing reliance on bank borrowing.

It said credit to the public sector is estimated to grow by nearly 26 percent in June 2026, well above the BB's target. This shows that a significant share of the banking sector's limited liquidity is being absorbed by the government, leaving insufficient credit available for the private sector.

"Regardless of how attractive the fiscal incentives announced in the national budget are, their intended impact will remain limited without adequate and affordable access to financing," the DCCI said, suggesting closer coordination between monetary and fiscal initiatives.