Capital machinery imports grew 62 percent and intermediate goods up 59 percent during the period, according to Bangladesh Bank figures released yesterday.

"It indicates production and export growth in the near future," a senior central bank official told the news agency.

He explained that the import trend might have an adverse impact on the balance of payment situation of the country, but would yield benefit for the economy in the long run.

The official said textile and RMG entrepreneurs might have waited to see the consequences of the post-MFA (multi-fibre arrangement) trade regime and now they are coming forward to open letters of credits (L/Cs) for the import of machinery for textiles and apparels industry.

L/Cs worth $986 million were opened for import of capital machinery and $692 million for miscellaneous industrial machinery during the eight-month period.

Major raw material imports included raw cotton and synthetic fibre ($428 million), yarn ($307 million), textile fabrics and accessories ($1,333 million) and pharmaceutical raw materials ($128 million).

Import of petroleum and petroleum products also increased significantly by 40 percent in the first eight months of the current fiscal, which was mainly due to price-hike of the items in the international market.

Authorised dealer banks opened L/Cs worth $1,159 million (equivalent to Tk7,324 crore) in the month of February 2005, showing a 6 percent less import expenditure than that of January 2005.

Import L/Cs opened for food items also increased significantly during the July-February period of FY 2004-05 as compared to the same period of the previous fiscal.

Of them, L/Cs for rice and wheat imports more than doubled to $301 million and $331 million respectively while those for sugar stood at $175 million, onion $63 million, fresh and dry fruits $47 million, pulses $114 million and milk-food $74 million.