Despite the government’s implementation of import restrictions on luxury items and other policies aimed at alleviating the dollar shortage and economic crisis, the situation has yet to improve. Since April 2022, the Bangladesh Bank has enforced stringent measures, including imposing a 100% margin on the import of non-essential goods such as vehicles and luxury items. Additionally, various other items have been subjected to a 100% cash LC margin. While these actions have curbed overall imports, the scarcity of dollars persists due to factors like spending in the energy sector, exchange rate misalignment, capital flight, and low foreign direct investment. Consequently, businesses struggle to import necessary inputs, with many banks facing negative balances in foreign currency holdings. Despite the Bangladesh Bank’s provision of approximately $26 billion to banks since FY 22 from foreign exchange reserves, severe dollar shortages persist, hindering the importation of essential goods crucial for economic growth.
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