Import letters of credit (L/Cs) opened in Bangladesh during the 2003-04 fiscal year increased by 23.53 per cent over the previous year according to the central bank.

Bangladesh Bank said importers opened L/Cs worth around US$12.3 billion in the last fiscal year ending June 2004 compared with the equivalent of about US$9.95 billion in the previous year.

Increases

Import categories that made significant contributions to import L/C growth in the year included intermediate goods, which increased by 25.84 per cent, industrial raw materials, which rose by 24.19 per cent, and capital equipment, which was up by 20.68 per cent.

The largest increase however was in the opening of import L/Cs for petroleum and petroleum products, which were up by 44.66 per cent in the last financial year compared with the previous one.

Industrialisation boost

According to president of Dhaka Chambers of Commerce and Industry (DCCI), Fazle R M Hassan, the figures are generally encouraging for the country's economy because so many of the imported items were purchased for industrial processing and ultimately formed part of finished goods for export.

"It is a positive sign and would help increase export volume," he said and added that most of the L/Cs opened would ultimately help the country's industrialisation.

Privatisation call

Hassan was not happy however with increases in import L/C openings for consumer goods such as sugar.

The DCCI president said domestic firms could meet demand for this commodity if the government privatised Bangladesh's state-owned sugar mills.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.