Bangladesh allows LPG imports on credit to ease supply crisis

LPG importers will be allowed to bring in supplies on buyers’ or suppliers’ credit from offshore banking units of local banks

Bangladesh Bank has announced measures to ease the import of liquefied petroleum gas (LPG) in an effort to address a prolonged supply shortage that has disrupted household and business activity across the country.

In a notice issued on Monday, the central bank said LPG importers would be allowed to bring in supplies on buyers’ or suppliers’ credit from offshore banking units of local banks, as well as from foreign banks and financial institutions. LPG imported under such arrangements will be treated as an industrial raw material.

The decision comes amid an LPG shortage that has persisted for more than a month, pushing up cylinder prices by between Tk 350 and Tk 1,000, depending on size. Although the government sets LPG prices, consumers say cylinders are often unavailable at the official rates.

The shortage has affected cooking in homes as well as in hotels and restaurants, adding to public frustration.

Bangladesh Bank said LPG is usually imported in bulk and later bottled into cylinders for domestic use, a process that takes time after shipments arrive. To stabilise supply, the central bank said LPG would now qualify for import under buyers’ or suppliers’ credit, with a maximum credit period of 270 days.

Last month, Bangladesh Bank had extended a 270-day usance period for the import of industrial raw materials. The latest notice means LPG importers will also be able to access the same facility.