DHAKA, May 11 (Xinhua) -- The central bank of Bangladesh has tightened the letter of credit (LC) rules, doubling the margin for all imports, saving some essentials, to ease import-payment pressure on the economy.
"We've imposed higher LC margin to discourage the import of unnecessary items as well as luxury goods," Abu Farah Md Nasser, deputy governor of the Bangladesh Bank (BB), was quoted by English newspaper the Financial Express as saying in a report on Wednesday.
Under the latest move, the central bank of Bangladesh imposed a prohibitive 50-percent cash LC margin at the minimum on all non-essential items instead of 25 percent.
According to a notification issued by the BB on Tuesday night, such LC margin for high-end motor vehicles like SUVs and sedan cars along with electrical and electronic products which are being used as home appliances has been fixed at a minimum 75 percent, up from 25 percent.
The products exempted from the LC-margin-restriction inventory are baby foods, essential food and energy products, lifesaving drugs, local and export-oriented industries, government imports for priority projects and agriculture-related imports, according to the notification.
The senior BB official termed the move a temporary measure that will also help improve the country's current-account situation. ■