We all know that, according to the relevant regulations of the Central Bank of Bangladesh on foreign exchange management, except for special circumstances, foreign payments for import and export must generally be made by bank letter of credit.

The latest news on February 8th, the Bangladesh Congress approved the new "Import Policy Regulations (2021-24)" in principle. The regulation stipulates that Bangladeshi retailers importing goods not exceeding US$500,000 will be exempted from issuing letters of credit and will be settled in accordance with contracts and wire transfers.

The secretary of the Congress said at a press conference that after the implementation of the new policy, the development of Bangladesh's import trade will be more in line with the needs of the times and more competitive.

The new policy stipulates that exporting products or importing machinery should be completed within 24 months from the date of signing the contract, replacing the original 17 months. Under the new policy, individuals without an import registration can import products up to $10,000, and if the value of the goods exceeds $10,000, a permit is required.

In addition, in the bonded warehouse system part of the new policy, Bangladesh's 100% export-oriented enterprises import raw materials and goods required for six months without any back-to-back letters of credit, and the original import quota is four months of inventory preparation.

Another notable update is that Bangladesh central bank has instructed the country’s banks to check the validity of the Import Registration Certificate (IRC) and whether it is forged or not when issuing a Letter of Credit (LC). "Authorised dealer banks must ensure that the original and current IRC is used when opening a business's letter of credit," it said in the notice.