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Bangladesh: Deadline extended for opening LCs for rice import.
Aug 02, 2022

The food ministry has extended the deadline for private firms to open letters of credit (LCs) for importing rice until August 21 this year.
 
The move comes as traders have been shy in opening LCs amid the increasing dollar cost and uncertainty whether they would be able to make profit by bringing in the staple grain.
 
By the end of June, the government started allowing private firms to import rice to curb the spiralling domestic prices by increasing supply in local markets.
 
Until now, the food ministry has granted permission for businesses to import around 10 lakh tonnes of rice at reduced duty and they have since received clearance to bring 600,000 tonnes, said a senior official of the food ministry.
 
However, between July 1 and July 27, private traders imported just 5,500 tonnes of rice, according to food ministry data.
 
Officials said a number of firms that are yet to open LCs to import rice had urged the government to the extend the deadline that ended yesterday.
 
'Our objective is to facilitate imports and that would not be possible if we did not extend the deadline,' he added.
 
Chitta Majumder, managing director of Majumder Group of Industries, which operates rice mills and also imports the grain, said banks are not showing interest to open LCs amid the dollar scarcity. In addition, they are asking for a higher rate -- Tk 107 per dollar -- in case of payments above $100,000.
 
'Rice prices are high in India and in this situation, many are not showing interest to import the grain assuming they would not be able to make profit,' he added.
 
Majumder got permission to import 50,000 tonnes of rice and his firm has imported around 2,000 tonnes so far.
 
Over the last one month, rice prices declined for the government move to facilitate imports by slashing import tariff to 25 per cent from 62.5 per cent until October 31.
 
Yesterday, prices of the coarse grain stood at Tk 48 to Tk 50 per kilogramme in Dhaka, down 2 per cent from a month ago, according to the Trading Corporation of Bangladesh.
    
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