Central Bank relaxes controls to make it easier to pay electricity import bills

Staff Correspondent

Payment for electricity imports will no longer require separate approval from Bangladesh Bank. From now on, commercial banks will be able to pay bills directly under government-approved cross-border power purchase agreements. The central bank issued a notification in this regard on Tuesday.

Bangladesh Bank says the decision aims to simplify the payment process for imported electricity—especially for electricity purchased through the national grid. It is expected that this will speed up the remittance of money to foreign suppliers under bilateral electricity agreements.

However, experts say that while lifting the approval process will reduce administrative complexity, it could also raise questions about transparency and control over financial transactions. Because without direct approval from the central bank, oversight of sending money to foreign suppliers could be weak—especially if it is a large state-level contract.

The notification states that banks will have to strictly comply with all regulations related to foreign exchange transactions, customer verification (KYC), and policies related to prevention of money laundering and terrorist financing while making payments. In addition, there is an obligation to submit regular reports to Bangladesh Bank.

In addition, where customs formalities apply to the import of electricity, payment will have to be made through the conventional import process.

Economic analysts say Bangladesh’s participation in the South Asian regional power trade is growing—power import agreements with India, Nepal, and Bhutan are also becoming more multifaceted. In such a context, easing central bank approvals could help reduce bureaucratic red tape, but a strong monitoring framework is essential to maintain transparency.

A policy-making official at Bangladesh Bank, speaking on condition of anonymity, said that the rules have been simplified, but if monitoring is not strengthened, the transparency of state finances could be questioned.