Bangladesh is also feeling the heat of latest cash crunch in India. The revenue earnings of the Banglabandha port have come down to half in the past one month compared to the previous months.
Only 130 to 150 trucks now enter Bangladesh from India through the land port a day whereas the number was over 300, leading to the fall of the revenue earnings. The port is used primarily for importing stone from India.
Banglabandha Clearing and Forwarding Association president Rezaul Karim said Bangladeshi businessmen are not willing to open new bond or Letter of Credit (LC) in the wake of the cash crisis in India caused of Indian government’s clamp down on black money.
Banglabandha land port customs, importers and representatives of C&F agents said India is currently facing a cash crisis after the government banned all Rs 500 and Rs 1,000 notes.
Following the ban, the pace of trade and commerce has slowed down in India which also affected the stone import through the port.
Acting revenue officer of Banglabandha port Rownakul Islam said Bangladesh’s import from India has decreased whereas export of Bangladeshi goods to Nepal and Bhutan through the port has remained usual.
“There has been almost no new LCs since November. Our revenue income has fallen sharply with the decrease of number of trucks entering Bangladesh from some 300 to as low as 130 per day. We hope the trade at Banglabandha port will increase with the monetary condition getting normal in India,” he added.
Asked whether black money is the reason behind the fall of trading at the port, Rownakul Islam said, “It is really hard, and sometimes impossible, for us to trace when traders of both the countries resort to evading revenue. If any amount of money is traded beyond the LC, then it is called the black money.”
Talking to Prothom Alo, a Panchagarh stone trader, Babul Khan, said he did not open any LC in last one month.
The stone trader admitted that they often resort to under-invoicing to evade custom duties. “If the price of every cubic feet stone is US$ 13 dollars, we show US$ 10 dollars in the invoice. Look, we used to get Rs 83 in exchange for Tk 100 just before the cash crunch whereas it is now Tk 72 to 73.”
He said they get almost Tk 12,000 less in every Tk 100,000, which he said discouraged them from trading.
A number of truckers from India said the India’s Border Security Force (BSF) bars them from carrying liquid money and their owners are not also giving them the money for the cash crunch.
They said they are paying their daily expenses by lending money from their Bangladeshi counterpart.
Bangladeshi stone trader Asharful Islam said, “We are paying the Indian truckers about Tk 500 a day which we will deduct from the price of the stone later.”
A number of traders oftentimes resort to the fraudulent measure of under-invoicing to evade the revenue. Sometimes, they also do over invoicing to send black money across the border and the excessive money is laundered through hundi (illegal money transfer).
Stone trading between India and Bangladesh has fallen drastically as the traders from both the countries are unable to pay using black money.
The article originally published in Prothom Alo print edition is written in English by Saimul Huda