FEPD Circular Letter No. 24: Providing loan facility under Export Development Fund (EDF) to deemed exporters for Bulk import

Foreign Currency Policy Department Bangladesh Bank Head Office Dhaka. Ref. No. 24 Bhadra 20, 1423 Circular Letter No.-FEPD(Export Policy)220(1)/2016-24 Date: ------------------ September 04, 2016 To All Authorized Dealer Banks Head Office / Principal Office.

Dear Sir,

Subject: Providing loan facility under Export Development Fund (EDF) to deemed exporters for Bulk import of production inputs.

Reference is drawn to FE Circular No. 25 dated December 22, 2009, and all subsequent FE circulars issued on the subject matter.

According to the EDF-related circulars, in addition to loan facilities under the EDF for importing necessary production inputs for specific export activities, there is a provision for deemed exporter institutions affiliated with certain associations to avail the facility of bulk import of production inputs. In providing loan facilities under the EDF for bulk imports, a maximum limit is prescribed per customer. However, this limit shall not exceed the local currency repatriated against local supplies (including direct export earnings, where applicable) by the relevant deemed exporter institution in the past twelve months.

Recently, instances have come to the notice of Bangladesh Bank where loans were provided under the EDF for bulk imports based solely on the maximum limit stated in the circular, without considering the value of local currency repatriated against local supplies. In approving EDF loans for deemed exporters for bulk import of production inputs, caution is advised to ensure that the loan limit per customer does not exceed the prescribed amount as per the instructions mentioned in the relevant circular.

Yours faithfully,

(Md. Zakir Hossain Chowdhury) Deputy General Manager Phone: 9530250