Traders seek special quota for importing essential commodities ahead of Ramadan

Amid the ongoing dollar crunch, traders have sought a special quota for the import of essential commodities to ensure regular supply ahead of Ramadan.

The proposal, prompted by the fears of the essential commodity market turning volatile in the forthcoming Ramadan was made during a meeting of the task force committee on commodity price review at the commerce ministry Wednesday (4 January).

Noting an increasing difficulty in opening letters of credit (LCs) for essential goods, which has declined due to various conditions imposed on the import of products to preserve the country's dollar reserves, traders put forward their demand in the presence of Commerce Minister Tipu Munshi, Commerce Secretary Tapan Kanti Ghosh and Prime Minister's Private Industry and Investment Adviser Salman F Rahman.

Tipu Munshi assured concerned traders and importers that the proposal will be reviewed and discussed with the central bank.

During the press conference following the meeting today, the minister hoped that the problem with opening LCs for daily commodities will be solved soon.

He said, "Arrangements will be made to stock six food essentials - edible oil, chickpeas, lentils, onion, sugar and dates - so that there is no supply crunch in Ramadan."

Mentioning that the price of sugar is slightly higher than other products, he said, "We have decided to send an official request to reduce the duty on sugar."

In order to keep the commodity prices in check during Ramadan, Tipu Munshi said it will be determined based on the average price of number of goods bought by traders. Moreover, markets will be monitored to ensure the fixed rates are applied.

"A monitoring cell will check the retail market to determine prices in coordination with the import and supply of goods," he added.

The minister urged consumers not to stockpile an entire month's worth of groceries during Ramadan to keep the prices under control.

The relaxation of the cash margin rate against the opening of import LCs is important to keep prices of daily essentials at a tolerable level and the supply adequate during the forthcoming Ramadan.

The central bank fixed the opening margin rate for LC settlement at 75% to 100% in a bid to limit imports to save the depleting foreign currency reserves in the country.

Earlier, the central bank approved a 90-day deferral to pay import bills for eight essential commodities - edible oil, chickpeas, lentils, peas, onion, spices, sugar and dates- and allowed opening letters of credit with a minimum margin for these products based on the bank-client relationship.

The privilege will be eligible for the date of initiation of imports till 31 March next year.