Although imports fell drastically in the 2019-20 fiscal, the government aims to turn things around aiming for average import growth of 8% per year over the next three fiscals, including the current 2020-21.
The last quarter of the 2019-20 fiscal (April-June) coincided with the peak of the economic ravage brought on by the coronavirus pandemic.
The ‘lockdown’ and other measures implemented by governments worldwide, including Bangladesh, in response to the virus had a massive impact on economic activity. Depressed demand, fall in consumption and lower imports all went hand-in-hand.
According to available data from the country’s central bank, Bangladesh’s imports (including both goods and services) during the 2019-20 fiscal stood at $55.6 billion (over Tk 471,000) down from $62.9 billion (over Tk 528,000 crore ) in 2018-19, reflecting a decrease of 11.6%.
Imports of EPZs in the 2019-20 fiscal was Tk 25,631.7 crore, compared to Tk 30,830 crore in 2018-19, a fall of nearly 17 percent, which means EPZ imports fell proportionately more than overall imports.
According to an official document, the import growth projection for the running fiscal has been fixed at 10%, followed by 8% and 7% for 2021-22 and 2022-23 fiscals.
Imports for the 2019-20 fiscal were preliminarily projected to grow 10%, but later it was fixed at negative 10% due to COVID-19 pandemic.
The import growth in 2018-19 fiscal was 1.8%, according to official numbers.
It said that from the first half of the last fiscal the economy showed sluggish trend in import growth. The origination of coronavirus in Wuhan in January and worldwide lockdown added more woe to the scenario.
From July to March 2020 the import amount was USD 43.58 billion which is 4.81% lower than the previous year’s corresponding period.
The growth of overall Letter of Credit or L/Cs opening for July to February 2020 was negative 1.04% while the opening of L/Cs for capital machineries was negative 0.57% and for import of raw materials was negative 1.24%.
The document mentioned that from March 26 the country went under 66 days of general holidays resulting in curtailing of most economic activities. From May 2020 the mills and factories were opened in limited scale.
As per the document, the government for revamping the export sector, which is mainly dependent on imported raw materials and capital machineries, had announced a financial stimulus package as a countercyclical measure.
To put the economic activities on track again, the government had announced stimulus packages worth Tk 121,000 crore, which is equivalent to 4.3 percent of country’s GDP, at the initial stage of the general holidays to minimize the impacts COVID-19 pandemic on business, employment and productivity.
A total of 18 economic sectors, including export-oriented industries; small, medium and cottage industries, agriculture, fish farming, poultry and livestock were brought under these incentive packages.