Import letters of credits (IXs). valued 1,788.70 US dollars. were opened in first eight months of the current fiscal year up to February, according to the latest available figures from Bangladesh Bank.

In terms of LC openings. Imports declined by 417.67 million dollars in July-February (1990-91) from 2.206.37 million dollars recorded in the corresponding period of the last fiscal year. Figures for both years excluded imports under back-to-back LCs. ,

The outstanding import LCs on February 28. 1991 valued 1226.03 million dollars compared with 1748.71 million dollars on February 28. 1990.

The import pipeline al the close of first eight months of current fiscal year stood lower than what it was at 1528.72 million dollars at the beginning of the year.

The sluggish Import activities in 1990-91 reflected a depressed demand situation in the overall economy. The central baqk lowered the cash margin requirement for opening LCs for different categories of Imports recently tn an effort to boost import activities. But traders said that the depressed demand situation was still continuing and no major upturn tn Import activities was likely for the rest of the year.

The economy is in a reces-

sionary state tn Its organised sectors, the traders said. The Gulf war. lower volume of investments in both public and private sectors, production shortfalls in most industrial sectors, slow disbursements of credits, and. above ail. wait-and-see game on the part of broad economic operators have caused the recession to deepen Itself, they said.

While imports have slowed down, its Impact will be adversely felt on revenue collections of the government in the coming months, the knowledgeable circles said. The government is still dependent for about 50 per cent of its recurring revenue receipts on im-

port-related customs duty and sales tax.

So far. a major shortfall In revenue collections could be avoided because of a stronger import pipeline position at the beginning of the year. Such imports arrived In subsequent months and helped to avoid major disruptions to revenue collections.

But the pipeline position is now much lower than what it was at the beginning of the year. This will affect revenue collections for third and fourth quarters of the year if the situation docs not show any marked Improvement, the same circles said.

Meanwhile, imports of

Petroleum. Oil and Lubricant* (POL) In terms of LC openings in July-February period of 1990-91 totalled 320.10 million US dollars. Food imports were valued 30 million dollars, and non-POL and non-food imports amounted to 1465.22 million dollars. The above figures excluded imports under back-to-back letter of credits.