Capital machinery LC settlement 12% negative in FY21
In FY21, LC opening was $5,702 million and settlement was $3,741 million
Low investment in Bangladesh caused a 12.39% negative settlement of letter of credit (LC) in capital machinery in the last fiscal year (2020-21).
According to the Bangladesh Bank's latest data, in the last fiscal year, LC opening was $5,702 million and settlement was $3,741 million.
LC opening was 15.5% higher than that in the previous year but settlement was 12.39% negative.
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Industry insiders said the import of capital machinery, industrial raw materials, and intermediate goods are yet to get momentum despite the pickup in economic activity because of the persisting coronavirus pandemic.
The trend indicates that business people are yet to get back their confidence to set up new industrial units or expand their existing ones, they said.
The central bank's latest data shows the total value of import LCs opened by authorised dealer banks during the last fiscal year was $67,037 million, which was 19.5% higher than that in the previous year.
The value of LCs settled during the last fiscal year was $57,256 million, which was 7.52% higher than that in the previous year.
The permission to import rice to meet domestic demand was reflected in the significant increase in LC opening for rice.
The settlement of LCs for wheat, onion, fresh and dry fruits, edible oil, and drugs and medicines was also higher than the previous fiscal year.
On the other hand, LC opening for sugar decreased (-10.67%).
