The Bangladesh Bank (BB) has facilitated the process of importing raw materials and capital machinery to improve the business situation and ensure the supply of essential consumer goods to the local market.
The central bank announced in a circular that the decision was taken because of an improvement in foreign exchange reserves.
Going forward, bank-client connections will determine the margin level when opening letters of credit (LCs) against imported products.
However, importers will still need to pay in full to acquire letters of credit for a number of luxury items and import alternatives.
In 2022, the BB had asked banks to take up to 100 per cent of the payment in advance from businesses while opening LCs for luxury and non-essential items in an effort to keep forex reserves stable.
These included motor cars (sedans, SUVs, and MPVs), electrical and electronics, home appliances, gold and jewellery, valuable assets and pearls, ready-made garments, leather goods, jute products, toiletries, furniture, fruits and flowers, non-cereal food, processed food, alcohol, and tobacco.
Importers were instructed to pay 75 per cent of the import prices for all other goods upfront.
Later, the central bank relaxed rules regarding financing availed by commercial importers to cater to cottage, micro, small, and medium enterprises, aiming to accelerate the growth of industries and jobs.
