Exchange rate volatility

Almost every day there is coverage on country's FX situation, many banks have stopped opening LCs. No one is sure about future courses of actions. In his article also I found nothing new. It was a reiteration of rehearsed words since last 7-8 months -- who does not know that we have to reduce unnecessary imports? And it is very easy to state but can you please suggest, which items should we detect as unnecessary?

Despite all FX crises, July-Nov 05 import grew by 23 percent. What we import? The correct answer should be what we don't. Country's total import runs for around $13b of which around $2b for food grains/consumer items (rice, wheat, sugar, onion, spices items etc.), $5b capital/miscellaneous machinery/chemical items, $1.5b petroleum items, $2b for import of raw materials for textiles. Can we stop importing those items? We cannot stop importing food grains as these are necessities. We can't stop importing capital machinery for the shake of industrialization, which is very much growing. What about petroleum?

Even in this condition, there is no restriction on import but banks are currently unable to establish LCs for import of food grains/consumer goods and see the reactions in commodity market. There is demand-supply gap and price level has gone high. It is natural.

We are paying the extra amount for inelastic items. Now would anyone tell us, how we will make payment of $1b throughout the year? LCs established @ Tk. 67.00 per dollar now stood to Tk.70. If we want to settle $1b, how will we do that for additional Tk.

3b that occurred for devaluation? How long will we go for devaluation? Why do we forget that we are an import-oriented country and we spend $13b a year? Do we really think of it? The way we are devaluating our Taka against Dollar is more a debacle than correction. Despite having so many experts (in seminars/discussions/articles), we are lost everywhere. Why?