The double-digit inflation, after a gap of one month, in October has prompted the interim government to withdraw the single borrower exposure limit for imports of essential items such as edible oils, sugar and gram until the month of Ramadan.
In an emergency meeting on the price hike of essential commodities at the Ministry of Finance on Thursday, the government also decided that banks would not impose any margin against letters of credit for importing essential goods.
Inflation that has been prevailing at a decade-high since 2023 had hit double digits in July and was also sustained in the following month when the interim government assumed power after the fall of the Awami League regime.
In September, the general inflation eased to 9.92 per cent.聽聽聽
Bangladesh Bank governor Ahsan H Mansur who briefed reporters after Thursday鈥檚 meeting said that the high inflation was not surprising since the present government did not indulge in data manipulation like that of the immediate past AL regime.
Measures taken by the central bank in the past three months to bring down inflation at a tolerable level would take 12 to 18 months to deliver, he said.
鈥榃e have to be patient,鈥� said the Bangladesh Bank governor while blaming the AL regime for their wrong monetary and exchange rate policy for the prolonged inflation.
He said that relaxing the single borrower exposure limit would be made temporarily and would remain valid till the month of Ramadan, the month of fasting in the Muslim-majority country.
Through the latest decisions, the interim government made it clear that they wanted the local refineries to increase the import of edible oil and sugar and their supply in the market.
The food inflation recorded at 12.66 per cent by the Bangladesh Bureau of Statistics mainly pushed up the general inflation to 10.87 per cent in October.
The food inflation in the urban area has been recorded at 12.50 per cent and 12.75 per cent in rural areas in the past month.
The non-food inflation has eased to 9.34 per cent throughout the country.
The interim government has already cut duties on rice, onion, sugar and edible oils to tackle the price hike of essential food items, said finance secretary Khairuzzaman Mozumder while attending the briefing.
Besides, the meeting decided to enhance market monitoring and remove the supply side constraints.
While commenting on the observation that small聽 traders should be involved in imports, the central bank governor, however, warned of illogical market intervention.
He said that only a few companies were importing sugar and edible oils and also enjoying natural monopoly in the market with some of them maintaining 32 cargo ships and making annual turnover of Tk 60,000 crore to Tk 70,000 crore.
He, referring to the experience of the military-backed caretaker government in 2008-09, added that the illogical market intervention would not bring any good result.
The meeting presided over by finance and commerce adviser Salehuddin Ahmed was attended, among others, by planning and education adviser Wahiduddin Ahmed.
The central bank governor said that decisions were also taken to increase the amount of rice in the open market sale programme and the sales of essentials by the Trading Corporation of Bangladesh at subsidised rates for one crore family card holders.
The amount will be double to 10 kilograms of rice from the existing amount of 5 kgs, said the governor.
The governor said that private importers were reluctant to import rice despite cutting import duty on the item.
The private importers calculate that the imported rice cannot be sold at a price higher than the current staple price that increased over the past couple of months, but still remain below the last year鈥檚 level, he said.