Bangladesh's central bank cuts cost of credit for onion import

Bangladesh's central bank has directed all banks not to charge over 12 per cent on credit for onion imports from India in an effort to stabilise prices of the vegetable.
The directive, issued yesterday, will remain effective till December 31.
The prices of imported onions soared 270 per cent year-on-year to 90 Taka a kilogram yesterday after bad weather in India, Bangladesh's main source of the vegetable, created a supply crunch.
India hiked its export price to USD 900 a tonne on Saturday, up from USD 250 a month ago, The Daily Star newspaper reported today.
Officials of Bangladesh Bank, the country's central bank, said some banks were charging more than 14 per cent for onion imports.

The local market was destabilised due to a surge in prices in international markets, Bangladesh Bank said.
The central bank's move came a day after the Commerce Minister's request for reducing credit interest and letter of credit margin for onion imports.
The Trading Corporation of Bangladesh (TCB) on Sunday started selling onion at 55 Taka a kilogram in open markets to cool prices. However, consumers cannot buy more than a kilogram at a time from the state-owned TCB, which is selling the vegetable through its dealers via trucks.