Bangladesh Bank has extended the payment term for importing agricultural inputs and industrial raw materials in order to guarantee a consistent supply of goods. With effect from December 31 of this year, the new maximum payment time for import bills in this industry is 360 days.

Bangladesh Bank’s Foreign Exchange and Policy Department issued a notice about this adjustment on Monday, August 18. Stakeholders anticipate that this new ruling would help industrialist’s source raw resources.

As per the central bank’s guidelines, the previous maximum payment limit under Supplier and Buyer Credit (SBC) for importing industrial raw materials, including back-to-back imports, agricultural inputs, and chemical fertilizers, was 180 days. The recent decision has extended this period to 360 days. Consequently, businesses will experience some alleviation in the dollar crisis and will have a chance to conserve foreign exchange. However, this provision will not apply to imports financed through Export Development Fund (EDF) loans.

Earlier this year, the Bangladesh Textile Mills Association (BTMA) requested an extension of the credit period for importing raw materials necessary for the industry. On January 20, in a letter addressed to Central Bank Governor Dr. Ahsan H. Mansur, the organization advocated for an extension of the credit period for importing raw materials until December.

BTMA indicated that it comprises 1,850 members, with investments in this sector totaling approximately 22 billion US dollars. The textile and apparel sector accounts for 80-86 percent of the country’s export earnings, with the textile industry contributing 70 percent of that figure. Therefore, this sector is deemed an import-complementing industry. The request for an extension arose as mills were incurring significant losses due to the gas and electricity supply crisis, along with the rising dollar exchange rate.