Cabinet approves proposal for Sovereign Wealth Fund

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DHAKA : The cabinet today approved in principle a Finance Division proposal to create Bangladesh Sovereign Wealth Fund aimed at making foreign reserves useful during the time of needs.

The approval was given in the weekly meeting of the cabinet held at Bangladesh Secretariat with Prime Minister Sheikh Hasina in the chair.

Briefing reporters after the meeting Cabinet Secretary M Shafiul Alam said the authorised capital of the Sovereign Fund would be US$ 10 billion and its primary capital would be US$ 2 billion which would be channeled from Bangladesh Bank’s Foreign Exchange Reserve.

“The size of our present foreign exchange reserve is around US$ 30 to 32 billion. So, the reserve will not be affected or our economy will not face any trouble if we take two billion dollars from there to create the sovereign fund,” he said.

Alam said many countries developed identical funds and “we direly need such a fund to support the matching-fund with foreign countries or banks”.

The cabinet secretary said details of the objectives of the initiative was yet to be drawn out but the proposal suggested that it could be invested in multifaceted purposes including infrastructure development, payment of international trade and disaster management.

Alam said the cabinet in today’s meeting also approved five drafts on different laws including Bangladesh Chartered Accountants Act-2017 with a provision for scrapping membership of a fellow of the Institute of Chartered Accountants of Bangladesh (ICAB) for any misconducts or malpractices.

The other drafts which received the cabinet approval were: Trade Organizations Act-2017, Ground Water Management for Agriculture Act-2017 and ratification of two IMO conventions.

The IMO conventions are – International Convention for the Control and Management of Ships’ Ballast Water and Sediments (BWM)-2004, and International Convention on the Control of harmful Anti-fouling Systems on Ships (AFS), 2001.

The cabinet secretary said the draft of the Trade Organizations Act-2017 was basically the Bangla version of the main law title- “The Trade Organizations Ordinance-1961”.

According to Alam the cabinet, however asked the Commerce Ministry to update the law in light of the changes in areas of trade and commerce before final approval.

The Chartered Accountants Act-2017 is also the angla version of Bangladesh Chartered Accountants Order-1972 and subsequent amendments made during the military regimes from August 15, 1975 to April 9, 1979 and March 24, 1982 to November 11, 1986.

The cabinet secretary said the new law was framed in line with the Finance Reporting Act (FRA).

The new law proposed that members of the ICAB will be called ‘Associate Chartered Accountant’ and ‘Fellow Chartered Accountant’ instead of only ‘associate member’ and ‘fellow member’.

The draft also proposed empowering ICAB with the authority to suspend or cancell the membership of a fellow for any misconduct or failure to perform according to the FRA, which is a new feature of the law, the the cabinet secretary said.

Alam said the Ground Water Management of Agriculture-2017 was framed in Bangla which is a revised version of the Ground Water Management Ordinance-1985.

The law proposed for imposing fine of maximum Taka 2,000 or seven day imprisonment or both for installing any tube-well without license and approval of the Upazila Chairman.

Judgment of the offenses under the act can be delivered through summery trial, the law proposed, the cabinet secretary said.

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