Written by The Banking Post
Bangladesh Bank has relaxed import rules for liquefied petroleum gas (LPG) to help ease the ongoing supply crisis and stabilise the domestic market amid rising prices and shortages.
Under a new market intervention, the central bank has allowed LPG imports under suppliers’ or buyers’ credit, giving importers greater flexibility through deferred payment arrangements. The move is aimed at reducing financing pressure and ensuring smoother availability of bottled gas for households and businesses.
In a circular issued on Monday, the regulator said LPG imports would now be eligible for usance terms of up to 270 days. The decision comes as both pipeline gas and LPG supplies remain constrained, disrupting cooking needs and commercial activities across the country.
LPG cylinder prices have surged in recent months, varying by size, as limited availability continues to squeeze consumers and enterprises.
Bangladesh Bank noted that LPG is imported in bulk and later bottled for domestic use, a process that involves storage, bottling and distribution, requiring additional time and working capital. Considering these operational realities, the central bank said LPG would be treated as an industrial raw material for trade credit purposes.
Under existing foreign exchange regulations, imports of industrial raw materials can be financed through suppliers’ or buyers’ credit for up to 270 days, or the importer’s cash conversion cycle, whichever is shorter.
In addition to supplier credit, banks have been advised to arrange buyers’ credit facilities from overseas banks and financial institutions. Lenders may also facilitate bill discounting through offshore banking units of scheduled banks, subject to compliance with foreign exchange regulations and prudential credit norms.
The central bank expects the relaxed rules to improve import flows, ease supply bottlenecks and help stabilise LPG prices in the domestic market.
