The central bank suggested the government should take special credit from oil exporting countries to buy fuel to reduce mounting pressure on the country's foreign exchange, a top official said yesterday.

“We've already conveyed the message to the government for the special credit for Bangladesh Petroleum Corporation (BPC),” the official said, asking not to be named.

However, BPC Chairman Abu Bakar Siddique said he was not aware of any new move.

Siddique said BPC received special credit from the Islamic Development Bank and a syndicate of three foreign banks operating here. “I have no further information.”

Bangladesh Bank is in trouble trying to maintain a benchmark reserve of foreign exchange.

The local currency has been depreciating fast and reached nearly Tk 83 for the dollar Sunday from around Tk 70 a year ago.

The BB said the government may initiate talks to Qatar, Kuwait and other oil exporting countries to give it a credit line or a deferred facility to support its oil imports.

This kind of credit facility is not new. Many countries take such credit when in need. Sri Lanka got interest-free credit in 2009 and 2010 for crude oil import from Iran.

The pressure on the economy now stems from oil imports to feed rental power plants. The import of fuel oils rose by 92.44 percent to $2.20 billion in the first five months of the current fiscal year from $1.15 billion in the same period the previous year, according to BB data.

The oil import bill would cross $6 billion at the end of this fiscal year compared to less than $3.5 billion last year.

“We fear if the oil prices go up due to the Iran issue, things will worsen further,” said the BB official.

Iran has threatened last month to shut the Strait of Hormuz, a transit point for a fifth of oil traded worldwide, if sanctions are imposed on its crude exports. The BB fears the fiasco may fuel oil prices and pile pressure on its reserve.

Bangladesh raised fuel prices last month, which was the fourth such hike since May in a bid to reduce subsidy burden, ignoring that it would add to the rising inflation.

The Daily Star/Bangladesh/ 10th Jan 2012