Siddique Islam

The country's overall import fell drastically by over 21 per cent in February over that of the previous month of this calendar year because of a falling trend in prices of commodities in the global market.

"The import fell in February due to decline in opening of letters of credit (LCs) for imports in the last two months," a senior official of the Bangladesh Bank (BB) told the FE Saturday.

Import LCs worth US$ 1.405 billion and $1.583 billion were opened in December last and January respectively. But import LCs worth $1.698 billion were executed in February last.

"Most of the importers are now following wait and see strategy for avoiding any financial risk. As a result the opening of fresh LCs against imports dropped recently," he added.

The BB official also said the settlement of LCs against import may increase this month following a rise in opening of LCs in February, 2009.

The LCs against imports worth $1.572 billion were settled in February over that of $ 1.999 billion in January, according to the central bank provisional statistics.

"We'll pursue the commercial banks for taking effective measures to increase the import of the commodities," the BB official said, adding that import of essentials should be strengthened to ensure smooth supply of the items in the local market.

Imports of essentials including rice, wheat, sugar, edible oil and onion fell in terms of both quantity and value in February over that of the previous month of this year.

During the period under review, the import of rice declined by 8,000 tonnes to 72,000 tonnes, wheat by 80,000 tonnes to 0.247 million tonnes, sugar by 9,000 tonnes to 45,000 tonnes, edible oil by 79,000 tonnes to 65,000 tonnes and onion by 3000 tonnes to 31,000 tonnes in term of quantity, the BB's data showed.

On the other hand, the settlement of LCs for imports of rice dropped by $9.52 million to $14.47 million, wheat by $38.60 million to $59.95 million, sugar by $16.25 million to $17.69 million and edible oil by $39.43 million to $67.70 million.

Bankers said the import of essentials may improve this month due to increase in demand for the items in the local market. But they have urged the authorities concerned to ascertain both stock and demand for essentials immediately to avoid shortfall of the items.

"The overall imports may rise this month to meet the growing demand in local market," a senior official of a private commercial bank told the FE.