Even though there are no legal barriers in importing gold, no gold trader has imported one tola of gold since Bangladesh achieved its independence. There are no gold ores in the country either. Yet, the country has over 20,000 gold shops with more than 1 million artisans working in them.
In cities and in towns, gold jewellery shops are in demand. Gold worth lakhs of taka are sold every day, yet the amount of gold does not seem to diminish.
When asked how such a huge amount of gold is obtained every year without importing it, Bangladesh Jewellers’ Association (Bajus) President Gangacharan Malakar said: “A small amount of gold comes from abroad following baggage rules. The rest is covered by the existing gold in the country.”
However, Gangacharan said that due to complicated legal procedures, gold supply is extremely low, and as a result, its price is often increased.
General Secretary of Bajus Dilip Kumar Agarwal himself confirmed that not one tola of gold has been imported ever since Bangladesh got independent.
“For the last 48 years, we have been demanding legality,” said Agarwal. “For 20 years, we have been demanding policies on gold. But we are yet to see any results.”
Agarwal claimed that Bangladesh Bank is responsible for the lack of gold imports. In a report compiled by Bangladesh Bank, Nation Revenue Board (NBR), Tariff Commission and Ministry of Industries, the government is being deprived of a huge amount of revenue because of gold smuggling from different countries like Dubai and Singapore.
However, according to “Foreign Exchange Regulation Act 1947”, there are provisions for legally importing gold and silver from foreign countries by submitting 4% of Value Added Tax (VAT) while opening an LC in a bank. Other than that, traders can also import gold under baggage rules.
Yet, traders are still taking the illegal route by smuggling gold instead of following the legal steps.
In a discussion meeting between Bajus and NBR last year, Vice President of Bajus Enamul Haque Shamim said: “In the current market, a large amount of gold comes from the black market. Other than that, a small amount comes through personal transactions. Only 35-40% comes from internal markets.”
In a letter sent to Bangladesh Bank Governor Fazle Kabir, Bajus called the procedures needed for importing gold as “discriminatory” and “procrastination”.
However, according to Bangladesh Bank, it does not have any role to play in importing gold. Anyone can import gold following the necessary steps, but no trader has imported gold legally in the last 10 years.
This article was first published on banglatribune.com