LCs for rice import can be opened sans advance

Staff Correspondent | Published: 23:24, Jun 19,2017 | Updated: 00:13, Jun 20,2017

 
 

Bangladesh Bank on Monday advised commercial banks to open letters of credit for import of rice without taking any advance payment from the importers with a view to control the prices of the essential product on the local market.
The BB issued a circular to managing directors and chief executive officers of all banks asking them to open the LCs for import of rice without keeping any margin based on bank-client relationship.
The banks have to follow the directive till December 31, 2017 as the prices of rice continue to rise on the market for the last few months.
Instability in the
prices of rice is being observed in the market as supply of the product faced hindrance because of flash flood in haor belt in
April and the latest heavy rainfall in different parts of the country, the circular said.
In December 2003, the BB said in a circular that the banks were allowed to open LCs for all imported items with keeping any margin (0 to 100 per cent) based on bank-customer relationship.
The central bank, however, kept the loan disbursement tenure of current credit (hypothecation and pledge) unchanged for the mill owners and rice traders.
The mill owners and rice traders have to
adjust the current credit with the banks within 30 days in line with the previous central bank’s directive.
The prices of rice has abruptly increased since mid-April mainly
because of early rainfall and floods that destroyed boro crops in haor region and Chalan Beel, a BB official told New Age on Monday.
According to food department, the total government food stock reduced to 4.95 lakh tonnes, including 1.91 lakh tonnes of rice and 3.04 lakh tonnes of wheat, as on June 13.
BR 28 rice was sold for Tk 54-56 per kg while Miniket for Tk 58-62 per kg and coarse rice for Tk 46-48 per kg at retail market in last week, according to Trading Corporation of Bangladesh.

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