Both LC opening and settlement maintained a steady rise during the July-April period of the current fiscal (FY21) indicating a recovery of economic activities from the Covid-19 fallouts.
The total value of import LCs opened by Authorized Dealer (AD) banks during July-April of FY21 was US$ 52,961.84 million, 14.56 per cent higher than that in the same period of the previous fiscal (Fy20) of US$ 46,231.52 million, according to the latest data of Bangladesh Bank (BB) on the opening and settlement of letters of credit (LCs).
Value of LCs settled during July-April of FY21 totaled US$ 45,737.26 million, 3.84 per cent higher than that in the same period of the previous year's US$ 44,197.34 million.
LC settlement is considered to be the payment against imports.
"In the first 10 months (July-April) of the current fiscal year, imports soared 14.56 per cent compared to the same period a year ago, which indicates that economic activities are bouncing back," said a BB official.
As per the central bank report, the domestic demand will continue to grow as remittance inflow was high amid the pandemic.
The report mentioned that as the private sector is turning around, imports will increase in the coming days and the economy will turn around amid the second wave of Covid-19.
The central bank data showed that LCs opened for the import of raw cotton and synthetic fibre was US$ 2699.86 million during the July-April of FY21, which was US$ 1867.65 million during the same period of FY20. LC opening for the import of textile fabrics and accessories for garments increased by US$ 185.91 million to US$ 7446.12 million in July-April period of FY21 which was US$ 7260.21 million in FY20.
LC opening for pharmaceutical raw materials increased by US$ 94.97 million to US$930,13 million in July-April of FY21, which was US$ 835.16 million during the same period of FY20.
During the July-April period of FY21, LC opening for chemicals and chemical products increased by US$ 358.73 million to US$ 2630.35 million against the same period of last fiscal's US$ 2271.62 million.
However, for the import of capital machinery, LCs involving US$ 3796.69 were opened during the July-April period of FY21, down by US$ 651.31million from the same period of FY20's US$ 4248 million.
Import of consumer goods increased significantly during the period of FY21. LC opening for rice significantly increased by US$ 873.19 million in July-April of FY21 over that of the same period of FY20.
Rice import went up as the government gave permission to import rice to meet up internal demand. Wheat import increased 8.48 percent while onion 13.80 percent. Fresh fruits and dry fruits increased 40.54 per cent while edible oil 27.10.
Import of drugs and medicines increased 16.12 per cent to US$92.79 million during July-April period of FY21 which was US$79.92 million during the same period of FY20.
