The Bangladesh Bank has given traders the opportunity to import eight Ramadan-exclusive items on a 90-day credit and open letters of credit with a minimum margin based on the bank-client relationship.
The central bank allowed the imports of edible oil, chickpea, pulse, pea, onion, spices, sugar and date on usance terms effective for up to 90 days under supplier’s/buyer’s credit, according to a notice issued on Tuesday. The facility will remain applicable until March 31.
The central bank on Sunday issued a circular announcing the decision to allow opening LCs with a minimum margin, according to bdnews24.com.
In July, the national bank imposed a 75-100 per cent cash margin on the import of specific goods while restricting bank loans against these products in an effort to save up dollars.
The July circular did not impose restrictions on importing food and other essential items.
“We instructed the chief executives of banks to open letters of credit for import of essential items in the last bankers’ meeting. The latest circular letter was issued in light of that,” Bangladesh Bank spokesman Mezbaul Haque said.
A 100 per cent cash margin will remain effective for LCs for motor vehicles, electronics, gold and gold ornaments, valuable metals and pearls, garments, leather goods, jute products, cosmetics, furniture and decorative items, fruits and flowers, non-cereal foods, processed foods and drinks, tobacco or its substitutes and other luxury products, according to Mezbaul.
A 75 per cent cash margin will be applicable to LCs for the rest of the goods, barring essential items.
Bangladesh has been trying to reduce pressure on forex reserves by strictly regulating imports since April, causing the monthly LC settlement to fall to $5 billion in November from $8 billion a year earlier. The rate of opening new LCs plunged to $4 billion from $7 billion in the same period.
Bangladesh Bank has said it aims to “bring harmony” to the LC opening and settlement rates by January.