Imports posted only a slight increase in the first seven months of the current fiscal year as businesses remained cautious amid political uncertainty, weak domestic demand and persistent stress in the banking sector.
Data from Bangladesh Bank showed that the opening of letters of credit rose by 2.41 per cent to $42.77 billion in July–January of FY26, up from $41.76 billion in the same period a year earlier.
Bankers said that the modest growth reflects a cautious approach by importers as political activities intensified ahead of the national election held on February 12.
Although economic conditions have improved somewhat from last year’s disruptions, the recovery remains fragile.
Businesses continued to face tight bank liquidity, elevated borrowing costs and uncertainty over policy direction.
Stability in the foreign exchange market has improved slightly but has yet to restore confidence for a stronger rebound in import demand.
Import activity had plunged in mid-2024 during the student-led movement that ended with the fall of the Sheikh Hasina government in August.
The unrest disrupted supply chains, delayed payments and worsened dollar shortages, forcing many firms to suspend procurement.
Analysts said that the current increase largely reflects a normalisation from that low base rather than a broad recovery.
LC openings for industrial raw materials fell by 2.28 per cent to $14.69 billion in July–January, indicating continued caution among manufacturers.
Many factories are operating below capacity as domestic demand remains weak and access to working capital is limited.
LC openings for intermediate goods also declined by 2.93 per cent to $2.48 billion, signalling subdued production activity.
In contrast, LC openings for capital machinery rose by 14.55 per cent to $1.21 billion from $1 billion a year earlier.
Economists said some firms have resumed delayed investment, particularly for replacement and energy-efficient equipment, though this does not yet signal a sustained investment cycle.
Actual import payments paint a weaker picture.
LC settlements fell by 1.21 per cent to $40 billion during the period from $40.52 billion a year earlier, suggesting many importers are still delaying shipments or renegotiating delivery schedules.
Foreign exchange reserves have improved, reaching $29.56 billion on March 11 under the IMF’s BPM6 methodology, or $34.3 billion under the conventional calculation.
However, the higher cost of imports continues to weigh on business decisions.
The interbank exchange rate has remained around Tk 122.5 per dollar since early 2025, compared with Tk 106 in early 2024.
Bankers also warned that the latest tensions in the Middle East could push up global energy prices and disrupt supply routes, potentially increasing Bangladesh’s import bill, particularly for petroleum products, in the coming months.
