Prices of shelled cashew nuts are likely to increase as the government has proposed increasing import duty and regulatory duty for the item in the national budget for fiscal year 2024-25.

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Finance Minister Abul Hassan Mahmood Ali today proposed imposing a 5 percent import duty and a 10 percent regulatory duty on shelled cashew nuts.

At present, importers have to pay 3 percent import duty on the import of cashew nuts in line with the SAFTA Agreement, according to which Bangladesh offers zero-duty benefits on the import of some products and minimal duty for some others.

The agreement came into force in 2006, succeeding the 1993 SAARC Preferential Trading Arrangement. SAFTA signatory countries are Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.

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Cashew nuts are produced in hilly areas of Bangladesh and factories have been set up to process them in recent years. Therefore, in FY24, 15 percent import duty was imposed on the import of shelled cashew nuts.

However, in his budget speech today, the finance minister said only 3 percent import duty is applicable on the import of the product as per the SAFTA agreement.

As a result, the local industry is suffering from huge losses as the product is being imported from SAFTA countries at low duty, he said.

Therefore, 5 percent import duty and 10 percent regulatory duty can be imposed on the import of shelled cashew nuts, he added.

Bangladesh annually imports around 8 lakh tonnes of cashew nuts, according to businesspeople.