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2022 data: Air passengers brought gold worth 45 thousand crore taka
This amount of gold has arrived through two airports in a legal way. There is no 'demand' for so much gold in the country.Masood Milad
Chittagong
Published: 30 April 2023, 01:39
The arrival of gold in the hands of passengers coming to Bangladesh from abroad is increasing. In 2022, about 54 tons of gold came through the two airports, the current market value of which is more than 45 thousand crore rupees. Compared to 2021, gold arrivals increased by 53 percent last year in terms of quantity.
Air passengers have brought these gold in a legal way, under passenger (non-passenger) baggage rules. However, due to the large increase in gold import, it is affecting the foreign exchange coming into the country. The concerned persons say that if the repatriates brought foreign currency instead of gold, it would have been added to the country's banking system. This currency would have played a role in overcoming the current crisis.
There is also the question whether there is a demand for this huge amount of gold in the country or not. According to the Gold Policy (2018), the new gold demand in the country is 18 to 36 tonnes annually. According to the Bangladesh Jewelers Association (BAJUS), 18 to 20 tonnes of new gold is required annually.
Mostafizur Rahman is a special fellow at the Center for Policy Dialogue (CPD), a non-governmental research organization.
When asked what happens after so much gold comes to the country, Bajus Vice President Anwar Hossain told Prothom Alo that most of this gold is smuggled. It is unusual for so much gold to come into the country in one year. Because, there is not so much demand for gold in the country.
Among the three international airports in Bangladesh, the account of bringing gold through Dhaka's Hazrat Shahjalal International Airport and Chittagong Shah Amanat International Airport was found.
Sylhet's Osmani International Airport was not accounted for. However, the data analysis of six months of 2021 shows that not much gold comes from Sylhet.
How and why gold is brought
As per passenger (non-travelling) baggage rules, a passenger can bring 234 grams or 20 gold bars duty-paid while coming from abroad. 2000 taka to be paid for each shipment. Usually both bars weigh around 234 grams.Passengers can bring gold jewelery up to 100 grams or eight and a half loads duty-free. This jewelery account does not register with customs. In 2022, the 45 thousand crores of gold that came in, this jewelry is not included.
Why is it increasing?
Analyzing the data, it can be seen that gold imports are increasing after the reduction of duty in the fiscal year 2019-20. In that financial year, in the case of bringing gold under passenger (non-travel) baggage rules, the duty was reduced by 1000 taka to 2000 taka per bag.According to the data of the two airports, 5 and a half tons of gold arrived in 2020, 35 tons in 2021 and about 54 tons in 2022. It should be noted that 54 tons are filled with about 46 lakhs.
In 2020, however, due to Corona, the passenger transport in airplanes was reduced. That year 23 thousand 674 people, in 2021 1 lakh 51 thousand 917 people and in 2022 about 2 lakh 32 thousand passengers brought gold. Bangladesh Bank now has 14 tons of gold stock.
It appears that much more gold is passing through the hands of passengers.
The World Gold Council, a UK-based organization, mentioned in a report on India's gold market in 2017 that after the Indian government took steps to control gold imports, illegal gold smuggling has been on the rise since 2013. About 100 tons of gold is smuggled into India every year. Its origin is Bangladesh, Myanmar and China. In the 2021 report as well, the organization mentioned the smuggling of gold from Bangladesh to India as well as Myanmar and China.
Institutional import is negligible
Gold is also imported institutionally in Bangladesh. Bangladesh Bank has given license to 19 institutions as gold import dealers.Although their import volume is less.
According to National Board of Revenue (NBR) data, seven companies have imported gold bars weighing 139 kg 640 grams since 2020, spending about $8.2 million so far after obtaining the license. 12 companies did not import despite getting license. A total of 24 kg of gold was imported in 2022, which was 93 kg in the previous year.
The concerned persons say that the reason for the low institutional import is that the customs duty is high in this case. Passengers can bring gold by paying a duty of two thousand rupees. Traders have to pay about five thousand rupees.
Mostafizur Rahman, Special Fellow of the private research organization Center for Policy Dialogue (CPD), thinks that the issue needs to be investigated as the import of gold bars is more than the demand. He told Prothom Alo that gold is coming from abroad through passengers due to good prices in the country. If the price is high in the neighboring country, there may be smuggling.
He said that it is possible to prevent gold smuggling by harmonizing the tariff rates with neighboring countries, as well as reducing the amount of gold brought per passenger. Even if reduced, there will be opportunities for expatriates. But the trend of gold smuggling will decrease.
Mostafizur Rahman said, these measures can now be used to increase the supply of foreign currency.
