Revamping Bangladesh’s Foreign Exchange Policy: A Pathway to Strengthening Export

Abstract

Bangladesh, a developing country, has witnessed remarkable economic growth and social progress in recent decades. Nevertheless, the country confronts some challenges due to the restrictive and complex foreign exchange regulations and transaction guidelines, which constrain its potential and competitiveness in the global market. This paper intends to analyze the causes, consequences, and solutions of the restrictive foreign exchange regulation and transaction guidelines that affect various sectors of the economy such as freelancing, e-commerce and f-commerce, fintech companies and their customers, and retail investment in global financial markets. With econometrics model, the paper sheds light on the casual relationship of export with Export of IT and IT enabled services, FDI, efficient Macroeconomic policy management and exchange rate. The paper found that flexible exchange rate along with FDI and export of service can enhance the export growth of Bangladesh. The paper further investigates the historical background and rationale of these regulations, as well as their current status and future implications. The paper will recommend to revamp the foreign exchange policies of Bangladesh by adopting a more liberal and flexible approach to foreign exchange regulation and transaction guidelines for IT and IT enabled services like freelancing, e-commerce, f-commerce, fintech sectors to flourish and contribute to export growth and the vision of achieving a smart economy for Bangladesh.