Bangladesh Bank has revised its foreign exchange policy to ease local borrowing for foreign-owned or foreign-controlled companies operating in the country.
In a circular issued by the Foreign Exchange Policy Department on Wednesday, the central bank announced an increase in the allowable debt-equity ratio for such companies from 50:50 to 60:40.
The move is aimed at facilitating access to Taka term loans for capacity expansion or BMRE (Balancing, Modernisation, Rehabilitation and Expansion) purposes.
The updated provision applies to foreign-owned or controlled companies engaged in manufacturing or service output activities in Bangladesh for at least three years.
Bangladesh received $2.7 billion remittances in 29 days of June
These entities are now eligible to secure term loans from the domestic market irrespective of the local content in their equity, as long as they comply with applicable credit norms and prudential regulations, including the single borrower exposure limit.
“All other instructions in this regard shall remain unchanged,” said the circular, signed by Monoar Uddin Ahmed, Director of the Foreign Exchange Policy Department.
The updated policy is part of broader efforts to attract and retain foreign investment by offering more flexible financing options.