Economy
Due to LC Opening Crisis Fruits, Dates price likely to hike amid Ramadan Ahead
Presently, the consumers will have to spend more money than usual in case of purchasing dates and other fruits—two essential items in iftar during Ramadan, due to importers’ difficulty in opening letters of credit (LCs) on time.
Price hike is a most common phenomenon ahead of the month of Ramadan in Bangladesh, and this year even more due to the LC opening crisis.
Already, the price of dates has doubled in the wholesale and retail markets and it will be more expensive ahead of Ramadan, said some businessmen.
The price of all types of dates has hiked in the local markets ranging from Tk 40 to Tk 160 per kg while different fruits range from Tk 30 to Tk 100 per kg.
Some traders said the prices of these essential iftar items will increase further during the month of Ramadan as they are facing difficulties in opening LCs which will push up the prices of dates and fruits.
According to the sources at Trading Corporation of Bangladesh (TCB), the price of dates increased by 20 percent compared to the last year.
Milton, a shop owner in the Baridhara area, said “The price of dates went more expensive in the past month ahead of Ramadan and I was able to purchase a limited amount of dates due to the soaring price of it.
He also feared that the price of dates would be soared further in the month of Ramadan.
Habibur Rahman, a fruit trader said the price of every fruit has increased.
Whatsoever, ajwa variety of dates is being sold at Tk 750-800 which was available at Tk 600-700 last year. Mariam variety of dates is being sold at Tk 800-850 while the premium variety of dates is being sold at Tk 1000-1200 per kg.
According to the statistics of Bangladesh Bank, the import of dates has fallen by almost half compared to the demands of it but during Ramadan the demand for dates is about 50,000 tonnes.
In the past three months, only 22,000 tonnes of dates were imported which is 46 percent less than the last year. However, the authorities concerned related to import dates have opened LC of 29,000 tonnes dates in January, said sources at Bangladesh Bank.
Sirajul Islam, president of Bangladesh Fresh Fruits Importers Association, said the demand for dates increases three to four times during the month of Ramadan. Besides, there is a demand of 50,000-70,000 dates in the country in a year while 40,000-50,000 is needed in Ramadan alone, he said.
Referring to the opening of LC, Sirajul said “This year the traders faced difficulties in opening LCs in time as they had to open it by paying 100% cash margin while it was 5 percent. The small traders are the worst sufferers in opening LCs.”
The dates are being imported from the Middle East and Africa and dates were being stocked five-six months before the Ramadan, he added.
He also said that the price of dates may increase 30 percent in Ramadan due to the dollar crisis and transport cost caused by the fuel price hike.
If the government will take steps in unloading dates in ports on a priority basis, then there will be no instability in the market, said Sirajul.
Contacted, Commerce Minister Tipu Munshi, said “We’ll take necessary steps so that the consumers can purchase dates, the most essential items in iftar, at a tolerable price.”
He also assured of keeping monitoring the market to prevent volatile price hikes of dates.
Issuing a warning, the minister also said strict action will be taken against those involved in increasing the price of dates after creating an artificial crisis.
During the eleventh month of the current fiscal year, the country’s foreign currency reserves have fallen below $19 billion for the first time. After paying off some import bills, the reserves have now stood at $18.26 billion on Sunday.
According to the International Monetary Fund (IMF), as of May 8, the total foreign currency reserves of the country were $19.82 billion.
Mohammad Mezbauul Haque, the spokesperson of Bangladesh Bank, informed that through the Asian Clearing Union (ACU), the central bank has paid off import bills totaling $1.63 billion over the past two months.
However, Bangladesh Bank maintains that after paying off the import bills, the foreign currency reserves now stand at $23.71 billion.
According to the Central Bank’s accounts, the reserves were $25.27 billion on May 8.
The Dhaka Stock Exchange (DSE) and the DSE Brokers Association (DBA) have expressed gratitude towards Prime Minister Sheikh Hasina for her directive to list government companies in the capital market, a move hailed as timely and positive.
The directive was issued during the recent meeting of the Executive Committee of the National Economic Council (Ecnec) last Thursday.
Dr. Hafiz Muhammad Hasan Babu, Chairman of DSE, described the directive as a significant step towards enhancing the dynamics of the capital market. He emphasized that besides invigorating the capital market, this move would also attract foreign investment and promote sustainable development.
Despite previous efforts, government institutions had not been listed in the stock exchange, according to a notification issued by the DSE. The Prime Minister’s directive is seen as a pivotal step towards revitalizing and expanding the economy.
Dr. Babu further remarked, “The listing of reputable companies in the capital market, as directed by the Prime Minister, will greatly benefit the country’s economy. It will also enhance investor confidence.”
Similarly, the DBA released a notification applauding the Prime Minister’s directive, terming it as positive and timely for the capital market.
Saiful Islam, President of DBA, expressed optimism about the directive’s potential to accelerate the country’s capital market and overall economy. He pledged support to relevant government departments and regulatory bodies in implementing the directive, ensuring its positive impact on the economy, including the capital market.
India has expressed interest in financing Bangladesh’s Teesta project, announced Foreign Minister Hasan Mahmud. Speaking to reporters after a meeting with Indian Foreign Secretary Vinay Mohan Kwatra, Mahmud stressed the importance of aligning the project with Bangladesh’s needs. He confirmed discussions on the Teesta issue during the meeting. Mahmud also affirmed Prime Minister Sheikh Hasina’s upcoming visit to New Delhi, indicating that the finalization of the date would depend on the formation of the new Indian government following ongoing elections.
Meanwhile, the IMF has approved a $1.15 billion staff-level loan for Bangladesh in its third tranche. Mahmud noted the ongoing elections in India and the subsequent formation of the new government as factors influencing the scheduling of PM Hasina’s visit.
When asked about the sequence of visits to India and China, Mahmud suggested Delhi’s geographical proximity to Bangladesh. Diplomatic sources suggest PM Hasina’s visit to India is planned for early July, following India’s elections.
Pre-election surveys indicate strong prospects for Indian Prime Minister Narendra Modi’s re-election. Modi previously congratulated PM Hasina on her electoral victory in January, expressing optimism about strengthening ties between the two nations.
The last bilateral engagement between the prime ministers occurred during the G-20 Leaders Summit in September 2023. Modi is expected to invite South Asian and BIMSTEC leaders to his swearing-in ceremony, fostering regional cooperation.
Addressing border killings, Mahmud emphasized the government’s commitment to ending such incidents and promoting the use of non-lethal weapons by border forces. Discussions also covered enhancing physical and people-to-people connectivity, including cooperation with India to import hydropower from Nepal and Bhutan through India. Mahmud highlighted the need to further ease visa restrictions to strengthen people-to-people relations.
