Bangladesh Bank on Sunday relaxed settlement policy of foreign letters of credit for the importers of unrefined edible oil, oil seeds, crude sugar and unground wheat.
The BB issued a circular to the authorised dealer branches of all scheduled banks saying that refiners and millers will not have to settle payment against foreign LCs on quarterly basis for importing unrefined edible oil and oil seeds, crude sugar and unground wheat if the tenure of the loans does not cross six months.
The central bank had earlier asked banks to settle payment against foreign LCs on quarterly basis if the import value of products is $1 million or more.
The BB’s move came as late payment for external imports has been increasing in recent quarters and the trend may cause a sudden large foreign exchange payment.
The local market will face an outflow pressure of foreign exchange at any time, if a number of companies settle their foreign LCs at a time, a BB official told New Age on Sunday.
Under the circumstances, the central bank had taken the previous step (payment in quarterly basis) to avoid such risk and to keep stable the country’s foreign exchange market, he said.
The central bank, however, relaxed the rule for unrefined edible oil, oil seeds, crude sugar and unground wheat considering demand of the businesspeople, he added.
-With New Age input
