The prevailing dollar crunch, coupled with the recently increased regulatory duty, has stood in the way of importing many types of fresh fruits in recent times.
Even after providing 100-per cent LC (letters of credit) margin, fruit importers cannot open LCs as desired due to dollar crunch in the banking sector.
They have sounded an alarm of possible price hike of fresh fruits during the upcoming holy month of Ramadan.
It would be tough to control fruit market during Ramadan if the government fails to provide necessary LC-related aid to the importers concerned.
To avert such fluid situation, the traders have requested the government for urgent measures for importing fresh fruits for Ramadan.
Locally produced fruits become pricier for commoners after price hike of imported fruits amid duty imposition last year and 100-per cent cash margin on LC opening due to dollar crisis.
Such contractionary measures by the government to save foreign currency caused lower import of fruits like apple, orange, malta and grape, increasing 30/40 per cent in prices of imported ones.
Amid such a situation, fruit importers and sellers said, consumers preferred locally produced fruits like mango, banana, pineapple, papaya and green coconut, leading to a rise in their prices too.
Apart from cash LC margin and regulatory duty, ballooning dollar rate and increased freight charge also caused overall fruit price surge, they added.
Many importers do not have the ability to open LCs on 100-per cent margin while the government’s move to consider fruits as luxury items is quite misleading.
The overall tax burden on imported fruits now stands at about 109 per cent.
On 24 May 2022, the revenue board slapped a 20-per cent duty on import of 130 products like fruits, cosmetics, flowers and furniture, terming them luxury items.
On July 04, the Bangladesh Bank issued a notification imposing 100-per cent cash LC margin on import of different luxury products, including fruits.
Bangladesh Fresh Fruits Importers Association president Sirajul Islam said the government is currently discouraging import of fresh fruits for dollar crisis defining such fruits as luxury items.
He hoped that fruit market would be stable during Ramadan if the government takes necessary measures.
Dhaka Mahanagar Fruit Import-Export and Merchants Multiple Cooperative Society Ltd has recently sought government’s intervention aiming to smooth supply of fresh fruits during Ramadan.
It called for steps in favour of opening LCs by genuine fruit importers.
Currently, traders import fruits like apple, orange, malta, pomegranate and dates from India, China, Brazil, South Africa and Egypt.
When contacted, general secretary Sheikh Abdul Karim of the cooperative society said only a few banks are now opening LCs on import of fruits.
“Earlier, we could open LCs with providing a 20-per cent margin. But now we have to pay 100-per cent margin. Yet, we can’t open LCs as expected.”
The central bank has recently asked some banks to open LCs on fruit imports.
“We’ll sit with the government authorities regarding the LC issue and they have assured us of meeting the prevailing problem,” Mr Karim said.
Former president of the importers’ association, Salimul Haque Essa, said: “LC opening for fruit import halted in the last couple of months for a dearth of dollar.”
He suggested that the government take steps as early as possible in this regard. Otherwise, the prices of fruits are likely to increase during Ramadan.
Currently, 40-per cent local fruits and 60-per cent imported ones are meeting the country’s demand.