Bangladesh has removed a formal restriction from its import regime. The Import Policy Order 2026–2029, dated August 23 and published in the Gazette on August 24, permits eligible industrial and commercial importers to use purchase or sales contracts for admissible imports without the former annual ceiling of US$500,000. It retains the LC route and remains subject to the order, product-specific conditions and applicable foreign exchange, customs, tax and anti-money-laundering rules.
For a small factory, a delayed input shipment is not a clerical inconvenience. Production schedules slip, delivery commitments become uncertain and working capital is locked into buffer stocks. A more flexible route can lower those costs, but not if an importer must submit the same contract, invoice, payment record and proof of entry separately to a bank, customs and the import-registration authority. Bangladesh should not replace one formal limit with a chain of disconnected checks. The practical question is whether a lawful import can move more predictably while a suspicious transaction becomes easier to identify.
This is not a case for weaker compliance. An LC creates documentary discipline, but does not by itself prove that a price, product description, source of funds or customs entry is sound. A purchase or sales contract is not a loophole by definition. The test is whether the claims in the contract, payment record and customs documents can be matched promptly and responsibly.
The foundations already exist. Bangladesh Bank’s FEPD-1 Circular No. 30, issued on August 13, requires authorised dealer banks, before opening an LC or initiating a permissible import, to obtain the relevant underlying indent, pro forma invoice or purchase or sales contract and report primary import data through the Online Import Monitoring System. It makes product description, market-consistent price and the correct eight-digit HS code central to the review. When an importer submits an authenticated bill of entry or a customs-certified invoice, the authorised dealer must compare it with the earlier IMP form and invoice and report the verification result online. The contract, importer registration, HS code, invoice, payment and customs clearance are records of one transaction, not separate stories.
The weakness lies in fragmentation. When records sit in separate systems and are reconciled late, a compliant firm can be asked repeatedly for evidence it has already supplied. At the same time, a material mismatch in price, classification, country of origin, payment terms or proof of entry can take longer to resolve. That is neither trade facilitation nor effective enforcement.
The commerce ministry should bring together Bangladesh Bank, the National Board of Revenue’s customs wing and the Office of the Chief Controller of Imports and Exports for a 90-day implementation protocol. It should define which existing records one authority may use for a lawful purpose, which agency resolves a discrepancy and how an importer receives a written response within a defined service period.
One practical step would be a single import-reference number when a contract is presented to the authorised dealer bank. It could follow the transaction through the IMP form, payment, customs declaration and bill of entry, with sub-references for several consignments or instalments. The point is to connect records that already describe the same import, not to create another document. Such a reference would not transfer legal authority. Customs would retain responsibility for valuation, classification and duty assessment; banks for foreign exchange compliance and due diligence; and the import-registration authority for its statutory work. It would simply prevent a trader from having to begin again at every desk.
Not every consignment deserves the same scrutiny. Complete and consistent documentation should normally receive swift processing. A material discrepancy in declared price, HS classification, origin, payment maturity or evidence of entry should trigger deeper examination. Repeated document changes, unusually priced transactions and dealings between related parties may also justify closer attention. The detailed risk formula need not be public; making it fully public could help dishonest actors avoid it. The service rules, however, must be public. Businesses should know which documents are required, which authority has raised a question, what the question is, how long a response should take and how an innocent data error can be corrected. If an agency asks again for information already supplied, it should record the reason.
Data-sharing can create a new bottleneck or expose commercially sensitive information. Access must be confined to a defined legal task, with a digital trail of each access. Contract values, suppliers and prices should not become casually available across offices. Otherwise, a reform intended to reduce friction will become a new source of leakage, discretion or delay.
The programme should begin with a three-month pilot involving a small number of authorised dealer banks and one major customs station. It should test the workflow and expose bottlenecks before a wider rollout, rather than start with a new fee, separate portal or discretionary signature. The result should be measured where business feels it. Each quarter, the relevant agencies could publish aggregated data on the average time for contract-based imports, the share matched with bills of entry, the time needed to resolve discrepancies and enforcement outcomes. Company-specific information need not be disclosed. The public should still see whether delays are falling, and risk detection is improving.
The issue matters most for smaller importers. Large groups can retain lawyers, specialised compliance teams and inventory buffers. A modest manufacturer or trader often cannot. If the route works only for firms that can navigate disconnected systems, the reform will deepen market concentration rather than broaden opportunity.
The Import Policy Order should not be judged merely by whether the number of LCs falls. Its real measure will be whether compliant businesses can import predictably and whether suspicious transactions can be detected more quickly and fairly. Bangladesh does not need less compliance. It needs compliance based on usable evidence rather than repeated paperwork.
The writer is a geopolitical and policy analyst. E-mail: [email protected]
