Dhaka, Bangladesh (BBN)– Bangladesh’s overall imports grew by 15.05 per cent in the first 10 months of this fiscal year (FY), mainly due to higher import of food grains and fuel oils, officials said.
The settlement of letters of credit (LCs), generally known as actual import, in terms of value, rose to nearly US$43 billion during the July-April period in the FY 2017-18 from $37.37 billion in the same period in the FY 17, according to the central bank’s latest statistics.
On the other hand, opening of LCs, generally known as import order, rose by nearly 52 per cent to $60.73 billion including $11.38 billion for Rooppur Nuclear Power Plant (NPP) during the July-April period of this fiscal from $35.67 billion in the same period of the FY 17.
The Bangladesh Atomic Energy Commission (BAEC), the state-run nuclear energy research and regulatory body, had opened the LC through the state-owned Sonali Bank Limited to import different items, including capital machinery, to build the plant.
Talking to the BBN, a senior official of the Bangladesh Bank (BB) said the overall imports increased significantly during the period under review due to higher imports of petroleum products and food grains.
Import of petroleum products jumped by 21.88 per cent to $2.59 billion during the July-April period of FY 18 from $2.12 billion in the same period of the previous fiscal, the BB data showed.
“Upward trend of oil prices in the global market pushed up the overall import of Bangladesh,” the central banker explained.
The average crude oil price stood at $68.8 per barrel in April 2018. It was $63.5 per barrel in February, according to the World Bank’s latest Commodity Markets Outlook, released on May 02.
The BB official also said the ongoing holy Ramadan and the upcoming Eid-ul-Fitr festival have contributed to the rise in overall import.
Food grain imports, particularly of rice and wheat, zoomed up by more than 176 per cent to $2.70 billion in the first 10 months of this fiscal from $976.87 million in the same period of the FY 17.
A large quantity of essential commodities is normally imported to meet the additional demand of consumers during the month of Ramadan, the month of fasting.
Import of consumer goods rose by 57.79 per cent to $6.64 billion during the period under review from $4.21 billion in the same period of the previous fiscal.
However, import of capital machinery may fall slightly in the coming months due to higher demand for the US dollar, a senior private banker said.
The exchange rate of Bangladesh Taka (BDT) depreciated significantly against the US dollar in recent months mainly due to higher demand for the greenback for settling import bills.
The local currency depreciated by BDT 3.10 to BDT 83.70 on Monday in the inter-bank foreign exchange market from BDT 80.60 on July 02, 2017, the first working day of the FY 18.
Import of capital machinery or industrial equipment used for productions increased by nearly 5.0 per cent to $4.40 billion in the 10 months to April of this fiscal year against $4.20 billion during the same period of FY 17.
The banker also hinted that possible political uncertainty centering the next general elections may also push down fresh import of capital machinery.
However, import of intermediate goods like coal, hard coke, clinker and scrap vessels increased by more than 8.0 per cent to $3.42 billion in the first 10 months of this fiscal from $3.16 billion in the same period of the previous fiscal.
During the period, import of machinery for miscellaneous industries witnessed a 7.67 per cent growth to $4.14 billion from $3.85 billion in the same period of the FY 17.
Import of industrial raw materials grew by nearly 11 per cent to $15.09 billion during the period under review from $13.60 billion in the same period of the previous fiscal.