On the occasion of Holy Ramadan, the Central Bank has relaxed the margin preservation conditions for opening letters of credit (LC) for imports of rice, wheat, onions, pulses, edible oil, sugar, eggs, chickpeas, peas, spices and dates. According to the new guidelines, 100% margin will not have to be reserved on the import of these products as before. Margin preservation is provided on the basis of bank-customer relationship.
The Central Bank has announced the immediate implementation of this directive, which will remain in force until March 31 next year.
Bangladesh Bank has issued a notification in this regard today on Wednesday.
According to the instructions, the central bank had ordered to preserve 100% margin on January 17 to deal with the dollar crisis. However, in December 2022, the central bank directed to determine the cash margin rate based on the bank-customer relationship. Mainly through simplification, initiatives have been taken to reduce the cash margin of import credit to keep the required supply normal along with keeping the price at a bearable level.
In this regard, Bangladesh Bank's spokesperson Executive Director Husne Ara Shikha told Ajker Patrika that importers will need less cash due to relaxation of LC margin. It will also reduce import costs. Due to this advantage, the price of these products in the market should be reduced to some extent. The dollar-crisis has recently hampered the opening of LCs for these products. As a result traders are facing problems in opening LCs of various fruits including pulses, edible oil, chickpeas, dates. The overall import of the country has already decreased. This initiative has been taken to ensure adequate supply of essential products during the upcoming fast.
