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Imports decline during first half of FY13

DHAKA, Mar 5, 2013 (BSS) - Opening of letters of credit (LCs) against import, generally known as import orders, decreased by over 4.26 percent to US$20.28 billion in the past 7 months (July- January) of the current 2012-13 financial year (FY13).

The amount of opening of LCs was $21.18 billion in the same period of the previous 2011-12 financial year (FY12), according to Bangladesh Bank (BB) data released this week.

The value of LCs settled during July-January also dropped by 11.22 percent to $18.7 billion, which was $21.08 billion in the corresponding period of FY12.

BB officials attributed the lower import to the sound domestic production and the careful monetary policy that discouraged unnecessary imports to help maintain a good balance of payment and strong reserve.

LCs opening for rice import marked a substantial fall by
85.28 percent against the backdrop of bumper rice production.
Importers also opened less LCs for importing consumer goods that
prompted fall in LCs for sugar by 55.17 percent, refined soybean
oil by 52.93 percent, spices by 31.98 percent, dairy products by
13.31 percent and onion by 10.52 percent.

However, there was phenomenal 258.11 percent increase in opening of LCs for salt when the price and demand for the essential item was high in domestic market. LCs opening for pulses also rose substantially by 72.27 percent and wheat by 36.62 percent.

There were also significant increases in opening of LCs for intermediate goods and capital machinery, which were 9.90 percent
and 9.70 percent respectively.