Import volume of 20 revenue- generating products declined in the last fiscal year 2022-23 with resultant fall in government's collection of customs duty and taxes by Tk 5,500 crore.
The country has been experiencing a severe manifestation of the dollar crisis aftermath of both the Covid pandemic and the Ukraine-Russia war. Following the crisis, Bangladesh Bank implemented stringent measures on LC opening.
The revenue collection of the National Board of Revenue (NBR) also decreases against imports. The revenue collection from the 20 products has decreased by Tk 5,558 crore in the recently concluded FY compared to last year. Out of which, the highest revenue decline is from furnace oil used for power generation, Tk 1,544 crore.
Analyzing the import figures of Chittagong Custom House, the country's largest customs station, among the top 20 imported products whose imports have decreased in FY2022-23 compared to FY 2021-22.
Chattogram Custom House (CCH) in FY 2022-23 has lost more than Tk 5.5 crore compared to its FY 2021-22.
Furnace oil, is at the top of the products where import and revenue collection witnessing a decrease in both import volume and revenue collection compared to the previous year. Owing to the prevailing dollar crisis, the import of this commodity witnessed a substantial decline of 1,214,866 metric tons in the fiscal year 2022-23.
Consequently, CCH incurred a revenue loss of Tk 1,544 crore for the outgoing fiscal year compared to the previous fiscal year. Imports of the product fell by 27 per cent from the previous fiscal year.
Insiders say, the Power Development Board (PDB) delayed payment of bills of Furnace oil-fired plants due to financial crunch and insufficient dollars in the last fiscal year. Many power plant owners could not import oil as per demand.
Sugar is witnessing a simultaneous decline in both import quantities and revenue collection. The import volume of this commodity has experienced a substantial contraction of 73 per cent in FY 2022-23 when compared to the FY 2021-22.
Meanwhile, the revenue collection by the CCH has dwindled by Tk 545 crore. The product was brought in through the Chattogram Port, with imports dropping from 417,483 metric tons in the FY 2021-22 to only 112,184 metric tons in the FY2022-23.
The import of crude oil saw a marginal decline of 4 per cent compared with the previous FY.
Despite the slight 4 per cent reduction in imports, the customs revenue registered a significant drop of 46 per cent. This signifies that the dip in import volumes resulted in a revenue collection decrease of Tk 469 crore compared to last FY.
Limestone import has decreased by 69 per cent in FY 2022-23 compared to FY 2021-22. CCH revenue collection has decreased by Tk 354 crore or 66 per cent.
Then betel nut is at number five in the list. The amount of import has decreased by 98 per cent while the CCH revenue has decreased by Tk 288 crore for the food product.
Saifur Rahman, an importer of Khatunganj, the country's largest consumer goods wholesale market, said, "The import of crucial commodities is no longer enjoying the same level of LC benefits as it did in the past, all due to the ongoing dollar crisis.”
The import of Polyvinyl chloride, a product used in the manufacture of plastic pipes, has decreased by 26 per cent in FY 2022-23 compared to FY 2021-22. In this, the collection of import duty has decreased by Tk 281 crore.
Next comes the structural parts i.e. small parts of bridges or large infrastructures. The import of this product has decreased by 100 per cent. Revenue collection from this sector has decreased by Tk 258 crore compared to last year.
Sources said the constructions of many mega structures including the Padma Bridge have already been completed. One lakh 68 thousand 829 metric tons of structural pots were imported in the FY 2021-22. Of which, only 131 metric tons were imported in FY 2022-23.
Another product in this category is bridge section steel. Import of this product has also decreased by 76 per cent. Revenue collection decreased by 71 per cent or Tk 156 crore against the decrease in import of the product. This product is ranked 11th in the list of products with reduced revenue collection.
Hot rolls, used in steel sector, are among the top 20 products with reduced imports. The import of this product has decreased by 12 per cent since the last FY and and revenue income decreased by Tk 213 crore or 17 per cent.
However, the import of two other products in the same sector decreased in FY 2022-23. Among them scrap vessels import decreased by 47 per cent and scrap import decreased by 15 per cent. Revenue collection against import of scrap vessels is decreased by Tk 129 crore and revenue collection against scrap import decreased by Tk 113 crore.
Regarding the drop in hot roll and scrap imports, Tapan Sen Gupta, Deputy Managing Director of BSRM, the country's top steel producer, told Business Post that the volume of LC has witnessed a reduction of approximately 25 to 30 per cent, primarily attributable to the ongoing dollar crisis.
The accurate flow of LC remains pivotal. Even if the international market's product prices plummet, the manufacturers of rods might miss out on exploiting these favorable conditions if they are unable to timely initiate LC transactions.”
The president of Bangladesh Ship Breakers and Recyclers Association (BSBRA) Md. Abu Taher made the same complaint about the import decrease scrap vessel. He told Business Post that due to not being able to do LC as per demand, the import of scrap ships has decreased by 47 per cent. Moreover, our business is in crisis due to the complexity of environmental clearance.
Besides, air-condition parts are also among the top 20 products due to decrease in imports. The import of this product has decreased by 99 per cent. In contrast, the duty collection has decreased by Tk 187 crore compared to last year. Imports of boneless bovine meat fell by 92 per cent while revenue collection saw Tk 156 crore decreases in import.
Moreover, there was a notable 33 percent decline in the imports of reconditioned car, leading to a corresponding reduction in revenue collection by Tk 137 crore. The import of refrigerators, on the other hand, plummeted by a substantial 78 per cent, causing a decline of Tk 131 crore in duty collection. The import of calcium chloride experienced a near-complete decline of almost 100 per cent, resulting in a revenue deficit of Tk 122 crore. During the 2021-22 fiscal year, the product had witnessed an import volume of 31,412 metric tons.
Besides, the import of CNG-powered three-wheeler autorickshaws has decreased by 81 per cent while the duty collection has decreased by Tk 118 crore. Import volumes for motorcycle piston engines have undergone a significant reduction of 51 per cent, directly contributing to a revenue decline of Tk 113 crore. Similarly, the import of the latest double cabin pickups has experienced a steep reduction of 66 per cent, resulting in a considerable drop of Tk 108 crore or 62 per cent in duty collection.
Speaking to The Business Post, Chattogram Customs Commissioner Md. Faizur Rahman said, "The import of 20 commodities, which have yielded reduced revenues, has observed a remarkable decline of 1 crore 6 lakh 17 thousand 39 metric tons. This totals to a decrease of 44 per cent compared to the FY 2021-22. Our revenue collection has incurred a reduction of Tk 5558 crore, signifying a 40 per cent in terms of taka."
Had the import rate and global market prices remained consistent with the previous year, an additional revenue of Tk 4457 crore could have been saved. Our revenue stood at Tk 67 thousand 190 crore, signifying that achieving this scenario would have resulted in a growth rate of 13.57 per cent higher than the previous year, he added.
