Written by The Banking Post
Bangladesh Bank has relaxed import rules for liquefied petroleum gas (LPG), allowing importers to use credit facilities of up to 270 days in a bid to ease dollar liquidity pressure and ensure uninterrupted domestic supply.
Under the new arrangement, LPG imports will be treated as industrial raw materials, enabling deferred payment through suppliers’ credit or buyers’ credit for a maximum period of 270 days. The decision was communicated to all scheduled banks through a circular issued on Monday.
The central bank said LPG is largely imported in bulk and then bottled and marketed locally, a process that involves multiple stages and extended timelines. Considering this, LPG has been brought under the industrial raw material category, making it eligible for longer usance periods.
Previously, a circular issued on December 29 allowed a 270-day usance period for imports of industrial raw materials. The latest move extends the same facility to LPG importers.
Under the revised framework, importers can also obtain buyers’ credit from foreign banks or financial institutions and access bill discounting facilities through offshore banking units of local banks.
Bangladesh Bank said the extended credit period is intended to support importers’ cash flow and accelerate LPG imports, as storage, bottling and distribution require considerable time after arrival.
The decision comes amid a prolonged LPG supply crunch that has pushed prices sharply higher over the past two weeks. A 12kg cylinder, officially priced at Tk 1,300, has been selling for as much as Tk 2,500 in some areas, while the price of a 35kg cylinder has climbed to around Tk 5,000, well above the regulated Tk 3,200.
Traders blamed the shortage on a lack of vessels, difficulties in opening letters of credit and the temporary shutdown of several LPG plants.
Industry insiders expressed hope that the central bank’s special measures would help normalise LPG imports and stabilise prices in the domestic market in the coming days.
