Department of Business Administration
Assignment on Import performance and procedure in Bangladesh
Course title: International Financial Management
Course Code: FIN-5504
Submitted To:
Rizwan Hassan ACMA
Associate Professor
Department of Business Administration
International Islamic University Chittagong
Submitted By:
Masuma Akther
ID: R212425
Program: MBA
Semester: 5th Spring22
E-mail: masumamasuma555@gmail.com
Mobile no.:01732095333
Date of submission: 3rd June’22
1.0-Introduction
Bangladesh is a developing country. It has huge natural resources. But due to lack of capital
and technology, proper utilization of our natural resources is not possible. As a result, we have
to depend on foreign trade for importing industrial goods and exporting raw materials.
International trade is the basic activity by which a country establishes its economic relationship
with other countries. Trade is an integral part of the total national development and growth of
an economy. This is in fact a crucial instrument for industrialization while access to foreign
exchange is essential for sustained economic development. Trade policy works by inducing
substitution effects in the production and consumption of goods and services through changes
in price. Export and import are potential weapons of developing the Bangladesh economy and
can play an important role in achieving the country's socioeconomic objectives including
poverty reduction goals. In a capital-poor country like Bangladesh, export and import can
emerge as a significant factor to build up physical capital, create employment opportunities,
develop productive capacity and help integrate the domestic economy with the global economy.
In Bangladesh, the value of import has always been greater than the value of export. For this
reason the balance of trade is not favorable of Bangladesh. This has resulted in sustained fall
in the external value of our currency, which means a steady increase in exchange rate over the
whole period.
1.1-Objectives of the Study
The main objective of this study is to investigate the impact of import on economic growth in
Bangladesh. To achieve these, specific objectives of this study are:
⇒ Find out the relative importance of the determinants of import.
⇒ Estimate an idea of the nature and relative importance of determinants of import.
⇒ Examine the import-growth nexus.
⇒ Investigate into the relationship between import and GDP growth.
1.2-Balance of Trade
Balance of trade is the largest component of a country's balance of payments Trade. Trade
balance is the difference between export and Important.
Balance of trade is, BT=X-M where BT=Balance of trade, x=export and m=import.
By balance of trade is meant balance of visible trade.
Balance of trade may be three types
1. Equilibrium balance of trade; BT=X-M=0
2. Favorable balance of trade; Bt=X-M>0
3. Unfavorable balance of trade; BT=X-M
Bangladesh Trade Balance
Year
Billions of US $
% of GDP
$0.00B
-0.92%
$0.00B
0.69%
2020
$-20.76B
-6.40%
2019
$-18.50B
-6.11%
2018
$-23.69B
-8.64%
2017
$-13.06B
-5.23%
2016
$-10.31B
-4.65%
Source: http://www.macrotrends.net/
1.3-Performance of Imports of Bangladesh
No country is economically self-reliance in modern economy. Because every country sells its
excess products to other countries and import necessary products from other countries.
Bangladesh is a poor industrial but agriculture dependent country. For this reasons, Bangladesh
has to import foods and other necessary commodities.
The imports of Bangladesh and other countries are calculated as the total amount of goods and
services produced abroad and sold at home. Imports are often reported as percent of GDP so
that we can evaluate their magnitude relative to the size of the economy.
If imports are about 15 percent or less of GDP the economy is considered relatively closed.
That, for example, applies to the U.S. In contrast, many small European countries import over
40 percent of the products they consume. They are considered more open to international trade.
Imports of goods and services represent the value of all goods and other market services
received from the rest of the world. They include the value of merchandise, freight, insurance,
transport, travel, royalties, license fees, and other services, such as communication,
construction, financial, information, business, personal, and government services. They
exclude compensation of employees and investment income (formerly called factor services)
and transfer payments.
The average value for Bangladesh during that period was 16.22 percent with a minimum of 8.1
percent in 1975 and a maximum of 27.95 percent in 2012. The latest value from 2020 is 18.53
percent. For comparison, the world average in 2020 based on 158 countries is 43.98 percent.
1.4-GDP Growth and Import
The Gross Domestic Product (GDP) in Bangladesh expanded 7.11 percent in 2016 from the
previous year. This indicator has been discontinued and replaced by Bangladesh GDP Annual
Growth Rate. Source: Bangladesh Bank
Imports in Bangladesh is expected to be 480.00 BDT Billion by the end of this quarter,
according to Trading Economics global macro models and analysts’ expectations. In the longterm, the Bangladesh Imports is projected to trend around 500.00 BDT Billion in 2023,
according to our econometric models.
Imports in Bangladesh decreased to 558.28 BDT Billion in February from 590.01 BDT Billion
in January of 2022. Source: Bangladesh Bank
Imports in Bangladesh is expected to be 480.00 BDT Billion by the end of this quarter,
according to Trading Economics global macro models and analysts’ expectations. In the longterm, the Bangladesh Imports is projected to trend around 500.00 BDT Billion in 2023,
according to our econometric models.
Imports in Bangladesh increased to 656.59 BDT Billion in March from 558.28 BDT Billion in
February of 2022. Source: Bangladesh Bank
1.5-Major import item in Bangladesh
Bangladesh’s top 10 imports are cotton, machinery, mineral fuels & oils, electrical machinery
& electronics, iron & steel, plastics, vehicles, man-made staple fibers, animal or vegetable fats
& oils and cereals. According to Bangladesh import data, Bangladesh imported an estimated
US$ 50 billion worth of commodities from the world in 2019. Analyze Bangladesh import
statistics of Bangladesh imports and Bangladesh import partners.
According to the Economic Complexity Index (ECI), Bangladesh is the 127th most complex
economy. It rank 50 in total global imports. Given Bangladesh’s population of 166.6 million
people, its value of total imports translates to roughly US$ 300 in yearly product demand from
every person in the South Asian country.
In 2020, Bangladesh was the world's biggest importer of Heavy Pure Woven
Cotton ($975M), Heavy
Mixed
Woven
Cotton ($692M), Light
Pure
Woven
Cotton ($615M), Non-Retail Synthetic Staple Fibers Yarn ($306M), and Woven Fabric of
Synthetic Staple Fibers ($194M)
Annual import growth of
major items
20% 0% 20%
20%
20%
Bangladesh Imports By
Category Value
Heavy Pure Woven
Cotton $975M
20%
Heavy Mixed Woven
Cotton $692M
1.6-Major apparel importer in Bangladesh
Bangladesh’s top import partners are China, India, Singapore, Hong Kong, Indonesia, Japan,
South Korea, Malaysia, Brazil and Kuwait. According to Bangladesh customs data, these
countries shared 64% to overall value of shipments in 2020.
Country
China
India
Singapore
Hong Kong
Indonesia
Japan
South Korea
Malaysia
Brazil
Kuwait
Value USD %
21
12
9
5
4
3
3
3
2
2
1.7-Import growth in Bangladesh (Monthly)
Key information about Bangladesh Total Imports Growth:

Bangladesh Total Imports grew 40.2 % YoY in Feb 2022, compared with an increase
of 52.3 % YoY in the previous month;

Bangladesh Total Imports Growth data is updated monthly, available from Jul 1987 to
Feb 2022, with an average rate of 13.0 %;

The data reached an all-time high of 142.7 % in Nov 1988 and a record low of -50.7 %
in Apr 2020;

In the latest reports, Bangladesh Total Imports recorded 6.5 USD bn in Feb 2022;

Total Exports reached 3.7 USD bn in Feb 2022, which registered an increase of 38.8 %
year on year;

Bangladesh Trade Balance recorded a deficit of 2.8 USD bn in Feb 2022.
Bangladesh Total Imports grew 40.2 % YoY in Feb 2022, compared with an increase of 52.3
% YoY in the previous month See the table below for more data.
LAST
PREVIOUS MIN
40.2Feb 52.3Jan
2022
2022
-50.7Apr
2020
MAX
142.7Nov
1988
UNIT FREQUENCY RANGE
%
monthly
Jul 1987 Feb 2022
1.8-Competitive strength of Bangladesh
Bangladesh, one of Asia’s youngest countries, is poised to exploit the long-awaited
“demographic dividend” with a higher share of working-age population. Labor is Bangladesh’s
strongest source of comparative advantage, and Bangladesh’s abundant and growing labor
force is currently underutilized. Absorbing the growing labor force and utilizing better the
existing stock of underemployed people requires expansion of labor-intensive activities.
A new wave of reforms is needed to raise Bangladesh’s growth path. Deepening and
diversifying Bangladesh’s labor-embedded exports can transform the country from a rural,
agro-based economy into an urban, manufacturing economy. McKinsey & Company’s
interview-based survey of chief purchasing officers in European and U.S. apparel companies
in 2011 identified a number of challenges which, if not addressed, could cause Bangladesh to
miss the opportunity of attracting garment buyers moving out of China. These include:

Transport: congested roads, limited inland transport alternatives, absence of a deep-sea
port

Utility supply

Compliance with labor and social standards

A productivity gap reflecting skill and technological deficiencies

Soaring risks and long lead times

Political instability and corruption
By tackling these obstacles head-on, Bangladesh can seize the moment of opportunity to move
into the space that China’s transition will open up.
1.9-Comparative Advantage
The most cogent explanation of the competitive strength of the RMG exporters of Bangladesh
would appear to lie in the comparative advantage of the country. It is a labor abundant country
with a large base of unskilled and semi-skilled labor force with very low wages. Over the last
three decades it has developed some skill in garmenting, especially CM (cutting and making).
A fairly rapid population growth has ensured that there is always a substantial pool of
underemployed or unemployed people, which prevents the wage rate from rising. Consequently
the RMG manufacturers of the country can employ workers at a very low wage. Indeed the
average hourly wage rate of Bangladesh RMG workers is among the lowest in the world.
1.10-Import procedure in Bangladesh
Import Policy
The remarkable features of import policy are mentioned below:
i) To liberalize the import policy in the context of globalization and open market economy;
ii) To provide facilities for introducing technological innovation to cope with expanding
modern technology;
iii) Ensuring supply of qualitative and healthy product;
iv) To release the embargo on import goods step by step, to facilitate the availability of raw
materials of industry and to increase the competition and efficiency;
v) To enhance the indigenous exports by facilitating backward linkages for local industries;
vi)To ensure the supply of essential commodities in the national interest for emergency basis.
1.11-Characteristics and trend of Import Trade in Bangladesh
Bangladesh is still now an import dependent country. Bangladesh mainly imports primary
goods, manufactured commodities and capital goods etc.
Characteristics and trend of Import Trade in Bangladesh:
i) Import of consumable items;
ii) Import of capital goods;
iii) Import of Multi-dimensional products;
iv) High import expenditure;
v) Decentralization of import trade;
vi) Introducing of Wage earners scheme;
vii) Relaxation of government control;
viii) Import of essential goods;
ix) Increasing import of other goods except food;
x) Liberal and free import policy;
The trend of import trade of Bangladesh has significantly changed in last few years. As
export earnings has increased, the import expenditure has also increased.
1.12-Procedures for Import
For imported goods into Bangladesh, shipping agents submit their manifest data (containing
description of imported goods by ship) electronically to the Customs authority. In the case of
import by truck (through land customs stations), trucking company/driver submits IGM to the
customs authority. Once the Import General Manifest (IGM) is submitted online (In the case
of import by truck, manually), the nominated C&F Agent (or the importer himself) completes
the goods declaration (popularly known as Bill of Entry or B/E) from their own premises and
submits the goods declaration to Customs systems through ASYCUDA World. The declaration
or B/E has to be made in a specific format, known as Single Administrative Document (SAD).
The Prescribed Bill of Entry and Bill of Export Form Order, 2001 issued by the NBR outlines
the documentary submission requirements. For release of goods from Customs, following
documents need to be submitted along with the declaration for all types of imports:
1. Letter of Credit (L/C).
2. Invoice
3. Bill of Lading/AWB/Truck Receipt/Railway Receipt
4. Packing List
5. “Country of Origin” Certificate (except coal and export oriented garments industries)
6. Insurance policy/cover note
7. VAT/BIN Certificate
Following additional documents are required for different types of goods, such as:
1. BDS standard will be mandatory for clearance of 55 items, and in case where no
certificate from and accredited laboratory from the exporting country is available, a
certificate from the BSTI is necessary, as per Import Policy Order, 2015-2018 Para
26(28).
2. Radioactivity test report from the concerned authority of the exporting country for food
items (Import Policy Order, 2015-2018 Para 16).
3. Clearance certificate(s) from the Bangladesh Atomic Energy Commission for food
items to the effect that the radioactivity level found in the imported food-stuff is within
the acceptable limit (Import Policy Order, 2015-2018 Para 16(9)).
4. Pre-shipment Inspection test report for milk food products and powder milk, coal and
hard coke, Break Acrylic (HS 39.15 and 3915.90), M.S. Billets (7207) and for items
where the value of a single item authorized for import by public sector agencies is Taka
fifty lac or above.
5. Approval letter of the Chief Inspector of Explosives of the Ministry of Power, Energy
& Mineral Resources for import of explosives (Import Policy Order, 2015-2018 Para
26(1)).
6. Copy of intellectual property certificate (by the IPR holder of the exporting country) in
the case of import of branded goods registered under any law related to IP in
Bangladesh [Para 5(6)(c) of Import Policy Order, 2015-18]
Once the duties and taxes are assessed by Customs, the importer (or his C&F agent) pays duties
and taxes. On payment of duties and taxes assessed, Customs issues release order for clearance
and after completion of port formalities, goods are cleared.
Samples valued up to US $100 and weighing up to 5 kg is cleared (through manual system)
same-day (in Dhaka Air freight) if the consignee authorizes duty and tax to be billed to the
shipper on the Air Waybill. Samples valued over US $100 and weighing more than 5 kg will
require formal clearance through ASYCUDA WORLD system.
It is to be noted that for the customs clearance of imported animals, plants and plant products,
quarantine conditions (such as certification from quarantine department, fumigation etc.) shall
have to be observed. As per Import Policy Order, 2015-2018 Para 26(60), fumigation is
mandatory in case of import of raw cotton produced and packed in Western Hemisphere.
If an import consignment is not cleared within 21 days (of the date of unloading at a Customs
airport) or 30 days (of the date of unloading at a customs-port or a land customs station or
customs-inland container depot), or within the extended time as the appropriate officer may
allow, the consignment may be disposed of through auction [Section 82 of the Customs Act
1969].
In cases, where it is not possible immediately to assess customs duty that may be payable on
any imported goods for the reason that the goods require chemical or other test or a further
enquiry for purposes of assessment, or that all the documents or complete documents or full
information pertaining to those goods have not been furnished, Customs authority may assess
the consignment provisionally. In such cases, the importer (except goods entered for
warehousing) needs to furnish unconditional bank guarantee/security deposit of an amount (as
deemed sufficient by Customs) from a scheduled bank for the payment of the excess amount
of duty that may be payable after the final assessment. In this case, the final assessment has to
be completed within a period of 120 working days from the date of provisional assessment.
1.13-Fees and Charges:
There are various types of fees and charges that relate to trade (both import and export)
activities. However, such fees and charges are not imposed or collected by a single agency
(e.g. Customs), as these fall under the jurisdiction of different border agencies / GOB
agencies involved in trade related activities.

Fees and Charges by Customs:
Various fees and charges imposed by Customs on or in connection with importation or
exportation include a)
Document processing fee (for automated Customs assessment),
b) PSI services charge (in case of goods imported under Pre-shipment Inspection System):
It is imposed under Section 25C of the Customs Act, 1969. The rate for such charge is 1% of
the value of goods.
c)
Merchant overtime charge (in case of overtime duties by Customs officials),
d)
Container scanning charge,
e)
Transshipment fees: It is imposed under Section 125 of the Customs Act, 1969,
f) Customs fee on transshipment under Inland Waterways Protocol between India and
Bangladesh
g)
Fees for supplying copy of document: It is imposed under Section 204 of the Customs
Act, 1969
h) Fees for supplying Customs information: It is imposed under Section 204A of the
Customs Act, 1969
i) Fees for amendment of documents: It is imposed under Section 205 of the Customs Act,
1969
j) Fees for amendment of errors, etc.: It is imposed under Section 206 of the Customs Act,
1969

Fees and Charges by port operators:
There are different port operators working at airports, sea ports and land ports. Biman
Bangladesh Airlines manages/handles the airport cargo operations while Bangladesh Land
Port Authority handles goods movement at the land ports throughout the country. The cargo
operations at Chittagong and Mongla sea ports are handled by Chittagong Port Authority and
Mongla Port Authority respectively.
Types of fees and charges imposed and collected by various government agencies on import,
export and transport are highlighted below.
(a) Biman Bangladesh Airlines: Usually Biman Bangladesh Airlines charges importers and
exporters for using airport warehouse facilities. In addition, Biman charges Forklift fee for
goods weighing more than 100 kgs. It also charges DGR fee, an extra amount ($100) for
storing of Dangerous Goods.
There are two cargo terminal buildings at Hazrat Shahjalal International Airport for import
and export facilities of cargo: Import Terminal and Cargo Village (export). For information
on fees/charges imposed by Biman for imported goods, contact Import Section, Biman Cargo
Complex, Hazrat Shahjalal International Airport, Dhaka [Telephone: +880 2 8901500-19
(import), Ext.-25].
For charges/fees on export goods, please contact Cargo village (export), Hazrat Shahjalal
International Airport, Dhaka [Telephone: +880 2 8901500-19 (Export), Ext.-2507].
(b) Chittagong Port Authority (CPA): The CPA imposes and collects various fees and
charges for services and facilities offered to shipping companies, importers, exporters and
other stakeholders at the Chittagong sea port. Such fees and charges include - landing charge,
port handling charge (for port functions), port demurrage charge (in case of non-clearance
after a certain period), river dues/anchorage charge, pilotage charge etc.
(c) Mongla Port Authority (MPA): The MPA imposes and collects various fees and charges
for services and facilities offered to shipping companies, importers, exporters and other
stakeholders at the Mongla sea port. Such fees and charges include - landing charge, port
handling charge (for port functions), port demurrage charge (in case of non-clearance after a
certain period), river dues/anchorage charge, pilotage charge etc.
(d) Bangladesh Land Port Authority (BLPA): The BLPA imposes and collects various
fees and charges for services and facilities offered to its stakeholders at all the land ports in
the country. Such fees/charges include warehouse and open yard space charges, berthing
charges, water supply charges, river dues, landing charges, other charges.

Fees and Charges by CCI&E:
The Office of the Chief Controller of Imports and Exports (CCI&E) issues registration
certificates to importers, exporters and indentors, export permits, export-cum-import permits,
import permits on returnable basis, import permits and clearance permits and so forth.
Importers, exporters and indentors are subject to initial registration fee and renewal fees for
permits. They are also required to pay surcharge for failing to pay renewal fees within the
time limit. Importers are classified into six categories on the basis of overall annual import
for the purpose of registration and renewal fee. All Exporters and Indentors are to pay same
fees without any categorization.

Fees and Charges by Drugs
The Directorate General of Drug Administration (DGDA) under the Ministry of Health and
Family Welfare administers the import of drugs and raw materials and API (Active
Pharmaceuticals Ingredients) for drugs. The DGDA imposes and collects fees and charges for
such regulatory services. For example, a fee of Tk. 550 is required with the application for
approval of Block List.

Fees and Charges by BSTI
Bangladesh Standards and Testing Institution (BSTI) has set mandatory certification marking
for 55 items at import stage (Paragraph 26 (28) of the Import Policy Order, 2015-2018).
Importers need to submit certificate from the BSTI to the Customs Authority to clear these
products from Customs, if their consignments do not have certificates from accredited
laboratories from the exporting countries.
For comprehensive information on BSTI certification fees (for Imported Products brought
under mandatory certification before Customs clearance), the following Regulation may be
collected from the BSTI office:
BSTI Regulation 1989 and Amendment SRO- 230-Law/2009 dated 12 October, 2009.

Fees and Charges by Plant Quarantine Wing
The Government from time to time, determine fees and charges for inspection, examination
or treatment of plants or plant products, beneficial organisms or packing materials and may
also determine the procedure of collecting such fees and charges. The Plant Quarantine Wing
of the Department of Agriculture Extension (DAE) under the Ministry of Agriculture collects
such fees/charges.

Fees and Charges by Atomic Energy Commission
Bangladesh Atomic Energy Commission ensures that the relevant imported goods (food for
human consumption) are within the acceptable limits of radioactivity through conducting
radiation test.
1.14-Recommendations
Import expenditure is more than export earnings in Bangladesh. For this reason balance of
trade is not in favorable. To solve the problems, the following measures should be taken.
1.15-Policy Making
Appropriate Policy can play an important role to improve export and import trade in
Bangladesh. Acceleration of production and expansion of trade result in growth of national
wealth. Increased production in export sectors may become the prime mover in the
development cycle in a densely populated country like Bangladesh as this will generate
employment opportunities which in turn will generate savings and investment on consequent
flow of capital. The prime national objective of poverty alleviation will thus be materialized.
As a first step towards reaching this goal Bangladesh need to look at the country's production
infrastructure. Bangladesh’s export trade is featured by the dominance of a few commodities
in a narrow market. Such dependence on limited number of export items targeted at few
limited markets is not desirable for economic development. The country must, therefore, aim
both at product and market diversification or else our export trade will become stagnant in the
near future. In this exercise it is imperative to identify new thrust sectors, reduction of
production cost, increased export of higher value added items, diversify product wise , ensure
products quality, improve packaging, attain efficient productivity, establishment of export
oriented industry, infrastructure development, modernization of small cottage industries, We
should aim at marketing quality products at competitive price at stipulated time.
1.16-Strategies
Well planned strategies are essential for favorable balance of trade in Bangladesh. For these
reasons the following strategies shall be undertaken to attain the objectives of the export and
import policy: Simplifying export procedures and helping the private sector to achieve
efficiency. The Govt. should encourage increased involvement of the private sector while the
govt. will continue to play its facilitating role; Enhancing technological strength and
productivity and facilitating reduction in cost and attain internationally accepted standard of
quality of exportable products and thereby consolidating their competitiveness; Ensuring
maximum use of local raw materials in the production of exported goods and encouraging
establishment Extensive advertisement, Participation in the international trade fairs,
specialized fairs, single country exhibitions abroad and also sending out trade missions, with
a view to consolidating our position in the existing market and creating new markets. Beside
these, the quantity of importable luxury goods like costly perfume, fashionable goods, luxury
vehicle etc. should be reduced. Instead of liberal import policy controlled import policy
should be taken.
1.17-Conclusion
The relationship between imports and economic growth has long been a subject of great
interest in the development literature. The theoretical consensus on export-led growth
emerged in 1970s and 1980s after the successful performance of the East-Asian economies.
Imports affecting economic growth favorably in different countries and regions. This paper
provides updated estimates of the relationship Imports and GDP growth in Bangladesh for the
period of 2016 to 2020. Based on the overall study, in Bangladeshi context the export and
import have the significant positive relationship, and also, both export and import have the
significant impact on the economic growth. The impact of exports on economic growth found
as positive and an opposite scenario is found in the case of import.
References:
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tradingeconomics.com
www.researchgate.net
tcdata360.worldbank.org
www.theglobaleconomy.com
oikosmist.com
www.thedailystar.net
en.wikipedia.org
https://oec.world/en/profile/country/bgd
www.trade.gov
www.bangladeshcustoms.gov.bd