The import of capital machinery and industrial raw materials plummeted in the first five months of the current fiscal year, raising fears for the state of the country’s industrial sector and its overall growth.
The settlement of letters of credit or actual import payment for capital machinery in July- November posted a negative growth of 28.02 per cent and industrial raw materials a negative 6.31 per cent compared with that of 82.90 per cent and 56.07 per cent growth in July-November in the FY 2011-2012.
Executive director of local think-tank Centre for Policy Dialogue Mustafizur Rahman told New Age on Thursday that the negative import growth in capital machinery and industrial raw materials had already hit the export earning in the last few months.
He said that the negative trend had already affected the local investment and would hamper the expected GDP growth rate for the FY 2012-13.
The government has set a target to achieve 7.2 per cent GDP growth in the current fiscal year.
‘The negative import growth in the two vital products – capital machinery and industrial raw materials– does not match with the expected GDP growth rate,’ he said.
Bangladesh Institute of Development Studies research director Zaid Bakht said the import of industrial raw materials and capital machinery had declined due to an unfriendly environment for investment.
The prevailing political turmoil has made a negative business climate in the country, he said.
He said, ‘A number of businessmen were reluctant to import the two items as the existing industries were facing a severe power crisis. Businessmen are now reluctant to expand their investment. So, the growth in import of industrial raw materials and capital machinery continues to decline.’
According to the Bangladesh Bank data released on Wednesday, the settlement of LCs for the capital machinery totalled only $803.12 million in July-November against $1,115.75 million in the first five months of the FY 2011-12.
LC opening for the capital machinery in the first five months of the FY 2012-13, however, registered a 2.49-per cent growth compared with that of a negative growth of 17.58 per cent in the corresponding period of the FY 2011-12.
LC settlements in the first five months of the current financial year for the industrial raw materials were $5.38 billion against $5.74 billion in the corresponding period of the FY 2011-12.
LC opening for the industrial raw materials in the first five months of the FY 2012-13 also registered a negative growth of 5.24 per cent compared with that of 17.96 per cent growth in the same period of the FY 2011-12.