B Mirror Report: Bangladesh’s import-bill settlement declined slightly during the first seven months of the current fiscal year despite a modest rise in import orders, reflecting subdued industrial activity and shifting foreign-exchange dynamics.

According to Bangladesh Bank data, letters of credit (LCs) worth $42.78 billion were opened during the July–January period of FY26, up 2.41 percent from $41.76 billion in the same period last year, but actual LC settlements fell by 1.21 percent to $40.03 billion from $40.52 billion. Economists say the gap between LC openings and settlements indicates that while businesses are placing more import orders, actual payments remain constrained due to slower industrial activity and cautious spending.

Imports of key industrial goods, petroleum products, and raw materials continued to decline, signaling weaker investment and production, although imports of capital machinery saw a slight increase, suggesting an early sign of economic recovery. Strong remittance inflows have also affected the foreign exchange market, reducing demand for US dollars while boosting supply, prompting Bangladesh Bank to step up dollar purchases to prevent excessive appreciation of the taka and protect export competitiveness.

The central bank has bought around $5.38 billion since July 13 last year, raising gross foreign exchange reserves to $34.86 billion from $33.18 billion at the end of January. Experts, including Dr Md Ezazul Islam of BIBM and Dr M Masrur Reaz of Policy Exchange Bangladesh, said that increased capital machinery imports reflect improving business sentiment and that import volumes are expected to rise in the final quarter of FY26 following the peaceful political transition.

They added that central bank interventions in the forex market would help manage future international payment obligations and support a gradual economic rebound, with early signs of recovery visible in machinery imports and stable forex reserves.