$42bn LC opened during last FY

There has been a huge spurt in opening of Letters of Credit (LC) for imports during the last fiscal year ending June 30.

According to data released by Bangladesh Bank on Thursday, Bangladesh businesses opened LCs worth $41.82 billion in 2013-14 FY, which is 16.21 percent higher than the previous year’s $35.94 billion.

It shows LCs for rice imports rose by 1075 percent, for importing onions went up by 62.29 percent, those for importing edible oil rose by 54.30 percent and for capital machinery by 36 percent.

A media statement of Bangladesh Bank said: “The 36 percent growth in import of capital machinery is a record.”

According to the release, LCs worth $3.88 billion were opened for machinery imports, $366.4 million for rice, $1.54 billion for edible oil, and $187.20 million for onion in 2013-14.

In the previous FY, the figures were $2.8 billion, $31.18 million, $1.5 billion and $115.3 million respectively.

LCs worth $37.03 billion were opened import from various countries in the 2009-10 fiscal. The figure stood at $35.98 billion at FY 2010-11.

“The first few months of the past fiscal witnessed a slump in imports like the year before it, said Zaid Bakht, research director at Bangladesh Institute of Development Studies (BIDS).

“But businesspersons have regained confidence when political stability returned following the election on January 5. So imports of capital machinery and rice have increased.”