Bangladesh Bank has fixed the lending rate ceiling for onion imports at 12 percent.
The decision came on Monday, a day after the commerce ministry appealed to help cool the runaway price of the vegetable.
Onion prices have doubled to Tk 80-90 a kg in one month and traders are blaming a supply shortage for the price spiral.
Traders said a 100 percent margin against the opening of letter of credit (LC) and further 18 to 20 percent interest on the LC amount discouraged onion imports.
As a result the import of this essential commodity dropped significantly.
In a letter sent to the commercial banks Monday, the central bank has directed to them to charge a maximum of 12 percent interest on LCs for onion import.
The decision will remain effective till Dec 31.
On Sunday, the commerce ministry sent a letter to the Governor of the Bangladesh Bank to fix the rate at 10 percent.
Earlier, on March 2011, the central bank had set the lending rate at 12 percent on imports of essential commodities, a ceiling that was lifted in January 2012.-bdnews24.com
