Imports drop sharply in Jan due to turmoil

The country's overall imports fell substantially in this January, mainly due to the ongoing political unrest, officials said on Monday.
Opening of letters of credit (LCs) against imports, generally known as import orders, decreased by more than 7.0 per cent to US$ 3.20 billion in January, from $3.45 billion in the corresponding month of the previous calendar year.
On the other hand, the settlement of LCs, generally known as actual imports, dropped by 7.54 per cent to $3.04 billion during the period under review, from $3.29 billion in the same period in the previous year.
"The overall imports may fall further in the coming months, if the ongoing political turmoil continues," a senior official of the Bangladesh Bank (BB) told the FE.
He also said import order of different items, including scrap vessels, raw cotton and petroleum products, decreased during the period under review.
Import orders for scrap vessels came down to $64.41 million in January, from $105.98 million in the corresponding month of 2014. Raw cotton import orders fell to $158.88 million from $249.68 million, the BB data showed.
Besides, import orders for fuel oils fell to $125.19 million during the period under review, from $257.07 million in the same period of 2014.
The central banker said lower prices of petroleum products in the global market have contributed to cut the import orders in terms of value.
He also said back-to-back import orders for ready-made garment (RMG) products, including fabrics and accessories along with capital machinery, increased in January despite the political turmoil.
During the period, back-to-back import orders for RMG products, including fabrics and accessories, rose to $619.82 million, from $597.04 million in January 2014.
Import orders for capital machinery also rose to $311.04 million in January, from $218.36 million in the corresponding month of the previous year.
"Most of the importers are maintaining a wait-and-see policy to avoid financial risk due to the political turmoil," said a senior official of a leading private commercial bank.
He also said the supply chain of essentials has been severely affected, following the countrywide blockade and shutdowns, enforced by the BNP-Jamaat-led 20-Party Alliance since January 5.
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