Record oil import in Q1

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Siddique Islam The country's overall import payments grew by over 23 per cent in the first quarter (Q1) of the current fiscal year (FY), mainly due to more than 100 per cent increase in oil import bill, officials said. "The overall imports payment marked a significant growth as fuel import bill almost hit the roof in the first quarter," a senior official of the Bangladesh Bank (BB) told the FE Saturday. Letters of credit (LCs) against imports worth US$8.53 billion were settled during July-September period of FY'12 compared with those valued at $6.92 billion of the corresponding period of last fiscal, according to the central bank statistics. Bangladesh Taka (BDT) depreciated by 7.03 per cent against the US dollar during the period under review following increased demand for the latter to settle import payments by the commercial banks. The exchange rate of US dollar against BDT rose to Tk 74.57 in the Q1 of FY' 12 from Tk 69.67 in the same period of the previous fiscal, the BB data showed. The BB official also said the rising trend in petroleum products import is likely to continue in the coming months to meet the growing demand from the oil-based power plants across the country. The cost of petroleum products import stood US$1.19 billion during the period -- a record quarterly amount the government has so far spent on fuel oil imports -- up from $592.08 million over the same period of the previous fiscal. "The actual import of other essential items including industrial raw materials, intermediate goods and capital machinery also increased significantly during the period to meet the domestic demand," he noted. He also said fresh opening of LCs for capital machinery import decreased during the period as placing of import orders for different types of capital machinery including rental plants have declined recently. "Substantial import orders for capital machinery were placed in the last one year. So there will be no problem in the near future," he said without elaborating. The import orders for capital machinery declined by over 37 per cent to $501.80 million in the Q1 of FY'12 from $799.69 million in the corresponding period of the pervious fiscal, the BB data showed. "We're watching the latest situation of opening fresh LCs for capital machinery. It will take time to know the actual impact of lower import orders for capital machinery," another BB official said. Food import declined during the period under review as the country has built enough stock for the main staple rice after a bumper Boro crops in May this year, the central banker said, adding that it's a good sign for the economy. The BB figures show that import of food grains such as rice and wheat fell by 3.19 per cent to $341.07 million in the first quarter over the same period last fiscal. He also said stock of food grains (including transit stock) with the government stood higher at 1.36 million tonnes at the end of August, 2011 compared to 777000 tonnes at the end of August, 2010. Actual import of capital machinery -- industrial equipment used for production --- rose by 29.30 per cent to $597.44 million during the period against $462.05 million of the corresponding period of FY '11. Industrial raw material import increased by 15.64 per cent to $3.12 billion during the period under review from $2.70 billion of the corresponding period of the pervious fiscal. During the period, the import of machinery for miscellaneous industries witnessed a 26.27 per cent growth to $776.13 million compared with that of $614.65 million in the same period of the previous fiscal. However, import of intermediate goods like coal, hard coke, clinker and scrap vessels increased by 84.88 per cent to $704.54 million during the period from $381.08 million of the corresponding period of the previous fiscal.