The import payment for the capital machinery increased by 24.92 per cent to $1.14 billion in four months of the current financial year compared with that in the same period a year ago, strengthening suspicion of money laundering as the growth came amid dull business and investment situation in the country. The latest Bangladesh Bank data released on Thursday, however, showed that the import of industrial raw materials posted a negative growth in the July-October period of the FY16 compared with that of the same period in the FY15. Experts and BB officials said that some businessmen were now laundering money abroad in the form of import of capital machinery when the country’s business was facing a dull situation due to the ongoing political uncertainty. The BB data showed that the import payment for capital machinery had grown by 28.20 per cent in the July-October period of the last financial year. Capital machinery worth $917 million were imported in the period last financial year. The growth in import payment for industrial raw materials posted a negative growth at 0.61 per cent in the July-October period of this financial year compared with that of 4.13 per cent in the same period last year. The settlement of letters of credit for the industrial raw materials decreased to $4.92 billion in July-October of the FY16 from $4.95 billion during the same period a year ago. A BB official told New Age on Thursday that it was a mismatch that the import of industrial raw materials maintained a negative growth while the import of capital machinery jumped significantly. The country’s business is now facing a stagnant situation, and so the rising import of capital machinery raises a suspicion that money laundering might be occurring behind the scene, he said. Policy Research Institute executive director Ahsan H Mansur told New Age on Thursday that some persons had conducted capital flight in the form of import of capital machinery. They have done it through over-invoicing in the letters of credit form (LCF), he said. Mansur said that the country’s economy now was not so strong that the jump in the import of capital machinery could be explained, he said. He, however, said that the decreased global commodity prices might result in lower import cost of the industrial raw materials. A Bangladesh Institute of Bank Management research paper, which was placed before its annual conference last week, said that the mismatch between the increased import of capital machinery and the sluggish investment situation was a signal of trade misinvoicing. The paper said the settlement of LCs for capital machinery in the first few months of the FY16 increased despite a sluggish business trend, which raised suspicion that money laundering was occurred. In the first quarter of the FY13, when the investment climate was more favourable, LC settlement for the capital machinery stood at $492.61 million, a drop of 17.55 per cent from the same period a financial year ago, according to the research paper. The BB data showed that the overall LC settlement, generally known as actual imports, also posted a lower growth of 1.96 per cent in July-October of the FY16 compared with that of 11.10 per cent growth during the same period of the FY15. The country’s import payment stood at $13.19 billion in the July-October of the FY16 against $12.94 billion in the same period of the FY15.
