Bangladesh Proposes Sweeping Import Policy Revisions, Enhancing Trade Flexibility

The Bangladesh government is currently drafting a new Import Policy Order for 2026-2029, which includes significant proposed changes poised to reshape the nation’s trade finance landscape. These revisions aim to provide greater flexibility for businesses engaged in international commerce, particularly concerning the use and application of Letters of Credit (LCs).

Among the key proposals is the elimination of fixed time limits for shipment after opening Letters of Credit. Currently, these limits stand at 24 months for machinery and nine months for other goods. This proposed change could offer businesses more operational leeway and adaptability in managing their supply chains and logistics.

Additionally, the draft order suggests removing the existing $500,000 ceiling on imports under sales or purchase contracts that do not require the opening of Letters of Credit. This move is expected to further expand flexibility for businesses, allowing for higher-value transactions without the immediate need for an LC. Letters of Credit are widely recognized as bank-backed promises that ensure a seller receives payment once all required documents are provided, thereby reducing risk for both buyers and suppliers in international trade.

The policy also aims to increase minimum value-addition requirements for garment exports, signaling a broader strategy to enhance the economic impact of Bangladesh’s crucial textile sector. These proposed changes, once implemented, could significantly streamline trade processes and foster a more dynamic environment for importers and exporters in Bangladesh.