Bangladesh Bank (BB) has relaxed import regulations to ensure the adequate availability of essential food items during the upcoming Ramadan.
The holy month is set to begin at the end of February next year, and the central bank’s move is intended to stabilize the domestic market ahead of the anticipated surge in demand.
In a circular issued today, BB instructed banks to facilitate the opening of letters of credit (LCs) for importing crucial commodities such as rice, wheat, onion, pulse, edible oil, sugar, eggs, chickpeas, spices, and dates.
Banks are advised to do so based on their established relationships with clients, emphasizing keeping the minimum margins or advance payments on import values as low as possible for these specific Ramadan-related imports.
Additionally, the central bank has mandated that banks prioritize the settlement of LCs for these essential food items, ensuring that the supply chain remains robust. However, BB has maintained stricter rules for other imports.
Importers of non-essential items, including cars, electrical appliances, home appliances, and fruits, are still required to pay the LC value upfront fully.
This easing of regulations shifts from the more stringent LC opening measures introduced in 2022. The previous restrictions aimed to curb overall imports and stabilize the country’s under-pressure foreign exchange reserves.
Bangladesh’s foreign exchange reserves reached an all-time high of $48 billion in August 2021 but have since declined, standing at $25.44 billion at the end of last month, as reported by BB.
