Speaking at a media briefing on Saturday, Sheikh Fazle Fahim, the president of Federation of Bangladesh Chambers of Commerce and Industry or FBCCI, said traders, who have already opened LCs to import products from China, are facing shipping and customs clearance delays.
"The disruption to imports for the last month has created fears of bank payments becoming overdue. Under the circumstances, special measures are required in terms of credit assistance and loan repayment schemes to ensure that trade flow is not hindered in any way."
When an LC is opened for importing goods, banks set a deadline for the repayment of the credit and if the LC holder fails to meet the deadline, the payment becomes overdue. In such cases, banks impose stricter conditions making it difficult to open another LC in future.
Since its outbreak in China's Hubei province in December last year, the novel coronavirus has killed 2,345 people and infected more than 77,000 people in the country. The virus has since spread to over 30 countries around the world with the world's second largest economy, China, taking a big hit.
Bangladesh imported 672,000 tonnes of goods from China in January this year compared to 851,000 tonnes at the same time last year, marking a 21 percent drop, according to the FBCCI.
Fahim urged banks not to impose additional charges or penalty interest if an LC holder informs them that they will not be able to submit the necessary paperwork on time due to shipment delays.
He also called on banks to provide short-term loans to LC holders if they have an opportunity to import materials from alternative sources in case of shipment delay or failure.
