Exporters want daily dollar rate
To repatriate export earnings sooner
Zarif Mahmud: There is a dollar crisis in the country for a long time. To deal with this crisis, Bangladesh Bank has emphasized on bringing export income to the country on time. For this reason, if the traders delay in bringing the export earnings to the country, they have been instructed to pay the price at the dollar rate of the scheduled date of repatriation instead of the current exchange rate. Many traders in the export sector are expressing fear of financial loss after such instructions of Bangladesh Bank. In the meantime, several organizations have sent letters to the central bank. Instead of repatriation on the specified date in these letters, they have applied for the dollar rate (current exchange rate) of the day of repatriation.
According to the policy of Bangladesh Bank, after the export of goods from the port, it has to be reported on the Dash Board of Bangladesh Bank. There is a rule to repatriate the export value within 120 days of reporting. It is alleged that many businessmen are not repatriating their export earnings following this rule. According to the information, the export income of about 9 billion dollars has not arrived in the country even after the stipulated time has passed. The central bank has recently given several instructions to the banks to bring this income to the country quickly. Among them, an instruction issued on March 6 said that if the price of export goods is delayed in the country, traders will get the price at the dollar rate on the date of repatriation instead of the current rate on the date of repatriation. The difference between the current exchange rate and the exchange rate on the actual date of repatriation should be taken into account separately.
It is known that Bangladesh Jute Goods Exporters Association (BJGEA) sent a letter to Central Bank Governor Abdur Rauf Talukdar on October 11, demanding the daily rate of repatriation of export earnings. In that letter, it is said that due to sanctions in Iran, the main country of jute exports, no bank there can make the payment. As a result, no LC can be issued in our favour. That is why we have to export the goods against normal contract and get payment through a third country. It is similar to a consignment sale, where the goods are sold and paid for. Jute products are being exported in the same process with other countries except two countries. Due to which repatriation of jute export value is very difficult and often delayed.
In this regard, BJGEA Chairman S Ahmed Majumder said, none of us who are businessmen would want to take the income after the sale of the goods. But there is nothing we can do if the buyers make late payments. Moreover, jute is 100% fresh export product. There is no issue of back to back LCs. So, there is no issue of money laundering here.
He also said, “Even if we receive export earnings late, we buy products from mills on advance payment.” Apart from this, we also pay the workers’ availability and transportation costs on time. Then export income is delayed, why do not get the current exchange rate? That is why we have requested the governor to take this matter into consideration.
In this regard, an official of Bangladesh Bank said that due to the rising dollar rate, many businessmen are not bringing the export income on time. So, we have asked the banks to rate the dollar on the date of repatriation within 120 days. Any day that comes after 120 days will get the same rate as in 120 days. A lot of export earnings are stuck outside of us now. Therefore, it is not possible to accept their demand due to the dollar crisis.
BJGEA’s letter also said that during the third wave of Covid-19, the price of jute products abroad fell significantly. As a result, foreign buyers were reluctant to release the goods and many of our payments were delayed. In this case, since the importer’s bank is not involved, the buyer has to communicate and negotiate with the buyer to realize the payment. As a result, payment is not realized within 120 days of completion of export in most cases. But according to the central bank’s new decision, the payment for the exported goods will be converted at the current exchange rate of the dollar when realized. However, the customer will receive the payment at the rate prevailing on the day of 120 days of shipment and the excess amount will have to be deposited as sundry of the concerned AD branch, which will be reported to Bangladesh Bank in tabular form. There is nothing clear about what will happen to the money deposited in this Sundar or when the customer will get the refund. Due to this we exporters of jute goods are suffering financially. Because we have paid 30 to 50 percent of the price in advance from some mills, bought jute products and invested the workers’ dues, transportation costs in advance. But we didn’t get the payment on time, which we could have reinvested. On the other hand, the payment we get will also be at the previous rate, then we are suffering from both sides.
Earlier, Bangladesh Frozen Foods Exports Association also sent a letter to the Governor of Bangladesh Bank making the same demand. In that letter, it is said that the exporters complete the export through LC and TT. However, in many cases, foreign buyers (importers) send the export price late on various pretexts. In this case, for the delayed period, the exporters have to pay interest on the loan taken against the goods at various rates as per the conditions of the concerned bank. As a result, additional interest on bank loans is added to the cost of production of exported products, increasing the cost of exporting companies. Since the exporters complete the export process through bank loans, the loan is adjusted with interest in receiving dollars. Due to this, the financial losses of the exporters increase. Hence exporters will suffer financial loss if the export bill is not cashed at the dollar value of the date of repatriation (banking rate) of the value of exported goods to adjust interest on delayed bank loans.
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