A growing number of imported food products, including nutritious items for babies and the elderly, are disappearing from shelves as importers struggle to open Letters of Credit (L/Cs) under the Bangladesh Bank’s stringent cash margin requirements.

Importers report severe difficulties importing food items like baby formula, cereals, chocolates, nuts, and juices, primarily due to limited working capital, which makes it unaffordable to meet the high margins required for opening Letters of Credit.

In response, the Financial Institutions Division (FID) of the Ministry of Finance wrote to the Bangladesh Bank on 24 June 2025, urging it to allow traders to open L/Cs for foodstuffs with margins of only 10 to 15 percent.

The appeal followed a Bangladesh Bank circular issued on 5 September 2024, which imposed a 100 percent cash margin on the import of 14 product categories, including vehicles, electronics, gold, garments, leather, furniture, cosmetics, processed and canned foods, chocolates, juices, biscuits, coffee, and soft drinks.

Although some items have since been excluded, the high margin requirement remains unchanged for food imports.

Importers say the central bank’s inaction on the FID request over the past four months has disrupted the supply of essential food items that have no domestic alternatives.

He also cited additional obstacles such as port delays, high tariffs, and prolonged testing procedures at the Bangladesh Council of Scientific and Industrial Research (BCSIR).

Bangladeshi importers source a wide range of food items from the United States, Canada, the UAE, Africa, Australia, and Asia-Pacific countries.