Raw material imports weak amid persistent low demand

Imports of raw materials for different sectors have remained weak since 5 August last year as businesses continue to wait for policy certainties and socio-political stability.

The government has also remained wary of undertaking big development projects, keeping demand for construction materials low. As a ripple effect, forward-looking businesses are also finding it difficult to import their needed raw materials.

Furnace oil, diesel, cement, clinker, and bitumen are among the items most usually imported for the agricultural, industrial and construction sectors. But the imports have remained low. Over the past year, diesel imports have fallen 20%, furnace oil imports 10%, bitumen imports 22% and stone imports 16%.

The low imports mean less production activities and less revenue collection for the government. In the past fiscal year ending 30 June 2025, revenue collection was 12% less than the target. As a result, the government did not have enough development funds, pushing the Annual Development Programme (ADP) implementation rate to seven-year low last month.

But the government has other routes requiring funds, and in the absence of taxes, it resorts to borrowing. After the ongoing fiscal year, the loans would hit Tk23.42 thousand crore.

The Bangladesh Petroleum Corporation (BPC) imports fuel for government purposes. Officials of the organization declined to comment on the weak imports over the past year. An official from a fuel-related private company said, preferring anonymity, that production activities have weakened since last year’s uprising, leading to a drop in raw material imports.

Policy Exchange Bangladesh Chairman M Masrur Reaz said diesel is needed most in the agricultural, industrial and services sectors. The demand and imports have fallen due to a reduction in overall economic activities, he said.

LND/SAE