Photo: Collected
Benapole port in Bangladesh has seen a considerable decline in imports due to the global recession and the ensuing difficulties in opening Letters of Credit (LCs) amidst a dollar crisis. This has resulted in a shortfall in revenue collection for the current fiscal year 2023-24, with the actual collection amounting to Tk 5,213.11 crore, falling short of the targeted 5,281 crore by Tk 67.89 crore.
The port, which is a major gateway for goods imported from India, has experienced a noticeable decrease in the volume of imports. In the first 10 months of the financial year 2022-23, 17.553 lakh metric tons of goods were imported, whereas in the same period this year, the figure dropped to 14.042 lakh metric tons, marking a decrease of 2.57 lakh metric tons.
Traders and importers have attributed the decline to the inability to secure LCs due to the dollar crisis and the subsequent rise in prices, which remain unchecked. They warn that if the crisis persists, the import volume could further plummet, leading to a larger revenue deficit by the end of the fiscal year.
Customs sources have revealed that despite the National Board of Revenue (NBR) setting monthly revenue targets based on imported goods, the Benapole Customs has struggled to meet these targets in recent years due to the declining import trend.
Sultan Mahmud Vipul, the International Affairs Secretary of the Benapole C&F Agent Association, highlighted the reduction in LCs by commercial banks in response to the rising dollar prices and the resulting impact on revenue collection. However, he expressed optimism that the business situation would normalize by the end of the financial year once the crisis is addressed.
Aminul Haque, Vice President of the Benapole Import-Export Association, pointed out that banks have irrationally increased dollar prices, citing the global recession as the reason for the dollar crisis, making it impossible for importers to open LCs. He also noted that despite government-fixed dollar rates, banks are currently charging between Tk 125 to 128 for every $100, leading to fears of production disruptions in industries and uncontrolled price increases for imported goods.
Ejaz Uddin Tipu, Chairman of Ripon Autos and a major importer of motorcycle parts in Jessore, echoed these concerns, stating that the increased dollar exchange rate is hindering product imports, with banks reluctant to process LCs, affecting importers of motor and motorcycle parts.
Mizanur Rahman Khan, former president of the Jessore Chamber of Commerce, emphasized that importers are the hardest hit by the dollar crisis, with high exchange rates making products more expensive and leading to reduced imports and government revenue.
Joint Commissioner of Benapole Customs, Safayet Hossain, confirmed that traders are unable to open LCs for goods due to the current challenges, which has directly impacted import volumes and, consequently, revenue collection.
As the situation unfolds, stakeholders are closely monitoring the developments and hoping for a resolution to the crisis to restore normalcy in trade operations and revenue generation.
Messenger/Fameema
