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Bangladesh Bank Governor Md Mostaqur Rahman on Monday underscored the need for a stronger and more dynamic capital market to drive long-term economic growth, saying a deeper stock market is essential to boost private sector investment and reduce excessive dependence on bank financing.
He made the remarks during a meeting with a delegation from Chittagong Stock Exchange (CSE) PLC, led by its Chairman AKM Habibur Rahman, at the Bangladesh Bank headquarters in Dhaka, according to a press release.
The governor said Bangladesh needs to gradually raise private sector credit and investment to around 10 percent to sustain higher economic growth and support the country’s long-term development goals.
He noted that while the banking sector will continue to play a vital role in financing the economy, a vibrant capital market is equally important in providing entrepreneurs with access to long-term equity financing.
“A strong capital market can complement the banking sector by reducing excessive reliance on bank loans and creating alternative sources of financing for private sector expansion,” he said.
Roadmap for market expansion
To strengthen the country’s capital market, the Bangladesh Bank governor outlined a phased roadmap to increase market capitalisation over the next three fiscal years.
Under the plan, the target has been set at Tk 20,000 crore in FY2026-27, Tk 25,000 crore in FY2027-28 and Tk 30,000 crore in FY2028-29.
He said achieving these milestones would help transform the capital market into a major source of long-term financing for businesses, easing pressure on the banking sector while supporting sustainable economic growth.
Reforms to attract foreign investors
The governor also highlighted recent regulatory reforms aimed at making Bangladesh’s capital market more attractive to foreign portfolio investors.
He said Bangladesh Bank revised the rules governing Non-resident Investor’s Taka Accounts (NITA) through FEID Circular No. 02, issued on May 20, 2026.
Under the revised regulations, proceeds from the sale of shares and securities can now be credited directly to NITA accounts, simplifying transactions for overseas investors.
The new framework also authorises designated dealer banks to deduct and deposit capital gains tax directly into the government treasury, making fund repatriation faster and more efficient.
The governor said the reforms are expected to improve investor confidence, facilitate cross-border investment and enhance Bangladesh’s appeal as an emerging capital market destination.
The CSE delegation included Managing Director M Saifur Rahman Mazumdar and General Managers Mortuza Alam and Mohammad Monirul Huq. Senior officials of Bangladesh Bank also attended the meeting.
