Dollar crisis hits fresh LC opening

Traders in trouble

Staff Correspondent: There is a dollar crisis in the banks over the country. Due to this, traders are not able to import goods from different destinations. Importers fear that there will be a decline in the import of goods.
Importers say that many are unable to open letters of credit or import letters of credit (LC) due to lack of dollars. Now the products coming from India are through LC opened atleast a month ago.
As new LCs are not being opened, imports will decrease after a month.
However, the central bank is saying that Bangladesh Bank has not banned the opening of commercial LCs. So, there is no problem in opening LC.
An importerMizan has been moving to Agrani Bank Rajshahi branch since last month. He is carrying all kinds of papers required for importing goods from India. But due to the dollar crisis, he could not do any type of LC for the last one month. Not being able to do business, the interest in the bank is increasing. The salaries of the officers and employees are added to this. He is in trouble.
Mizan claims that he is not alone. Many more businessmen like him are running from bank to bank to open LC. Go to the bank and hear that there are no dollars. Due to the dollar crisis, the importers are facing difficulties as they are unable to open LC as per demand. If the crisis is not resolved quickly, the businessmen of this region will be in dire straits. However, Bangladesh Bank officials said that there is no obstacle in opening the LC.
An importer of Sonamsjid land port said LC is not being opened due to dollar crisis. Due to this we are not able to import any product from India. We are in a lot of trouble. Having to sit somehow unemployed. This increases the burden of debt. Small traders like us will sit in the way if there is no opportunity to open LC soon.
Meanwhile, the Sonamsjid land port market remains active with normal import and export. But now the crowd in the whole market has reduced a lot. Those involved in the import-export business say that there is no work. For this reason, zero point (port market) is not to be visited. They are spending time sitting at home or walking around.
Prabhat Kumar Singh, deputy commissioner of Sonamsjid land port customs station said, I have come to know about the complications with the LC. Traders are unable to do LC due to dollar shortage. However, its impact is not very evident right now. Because the goods arrive after some days of LC. The goods that are coming now are the previous LC. This effect may be felt after another 10 to 15 days. Stones and onions are mostly imported through this land port. In addition, fruits, corn, husks and spices come.
Rajshahi Chamber of Commerce and Industry President Masudur Rahman Rinku said, “No bank in Rajshahi has dollars. They are taking all the dollars to Dhaka now. By doing this our LC is open and closed. Businessmen are suffering losses.
The president of the chamber said, “We have given a memorandum to the Prime Minister through the Deputy Commissioner on behalf of the business organization at the beginning of this month. Traders want the opening of LCs to start very soon.
Bangladesh Bank Spokesperson Abul Kamal Azad said, “Bangladesh Bank has no restrictions on commercial LC. Each bank will open LC in their own foreign currency. It will be monitored by Bangladesh Bank as per their policy. In this regard, Bangladesh Bank has been and will continue to provide government assistance in the field of fuel, fertilizer and food.
Bangladesh Bank Executive Director and Spokesperson GM Abul Kalam Azad said that the issue of commercial import letters of credit (LC) being open and closed is not correct.
He said that even though there is a shortage of dollars, Bangladesh Bank has not given any instructions to open and close LCs. Banks are opening commercial letters of credit or LCs every day.
He said these things in a press conference on November 14. Bangladesh Bank Director SayedaKhanom along with Central Bank officials were present in the press conference.
GM Abul Kalam Azad said that banks are opening commercial letters of credit or LCs every day. Banks are opening LCs against products as per capacity. Bangladesh Bank is regularly providing dollar support to meet market demand. I hope it will continue in the future. However, false and misleading information is being spread through social media.
He said that 1 thousand 263 million USD has been opened till November 10 this month. In the same period of last October (first 10 days) which was 1 thousand 232 million dollars. Last October, the total LC opened was 4 thousand 743 million dollars. He said, mainly in view of the Corona epidemic and the Russia-Ukraine war, instability is created outside the economy. Because of this, the world economy is now in turmoil. As a result of this, our foreign exchange market tends to have disruptions in supply and demand.
GM Abul Kalam Azad said Bangladesh Bank has no restrictions on opening commercial LCs. Each bank is opening the loan in consideration of usable foreign exchange funds subject to their remittance income and remittance expenditure, will be opened. In this case, Bangladesh Bank has supervised according to the complete guidelines. A lot of information on over invoicing and under invoicing is available in special monitoring.
He said till date no foreign currency loan has defaulted and Bangladesh Bank will not allow it to happen. If necessary, Bangladesh Bank will provide advice and support.
Regarding remittances, the Bangladesh Bank spokesperson said that up to 10th of November of this year, remittances have arrived at 651 million US dollars; That was $641 million at the same time last year. Accordingly, the growth here is 2.8 percent.
Remittance growth from July last year to November 10 was 2.1 percent compared to the same period last year.