Revised trade deal with India okayed

The cabinet yesterday approved the revised Bangladesh-India bilateral trade agreement under which the two neighbours would use each other's territories for transiting goods to a third country.

The modified deal would enable Bangladesh to use Indian territories for transporting goods to Nepal and Bhutan. Similarly, India would be able to send goods to Myanmar through Bangladesh.

“If Bangladesh wants to trade with Bhutan and Nepal, it will be able to use Indian road, rail and waterways. It's a huge achievement for Bangladesh. It's an idea and initiative of Prime Minister Sheikh Hasina,” Cabinet Secretary M Musharraf Hossain Bhuiyan told reporters after the cabinet meeting at the secretariat.

The two countries had entered the deal on March 28, 1972. Under the previous agreement, which expired on March 31, trade could only be done between the two neighbours. Besides, India could transport goods to its seven northeastern states.

Talking to The Daily Star, Commerce Minister Tofail Ahmed said the revised deal would be signed either during Indian Prime Minister Narendra Modi's visit to Dhaka or Prime Minister Sheikh Hasina's trip to New Delhi.

He termed the modified agreement a milestone in Indo-Bangla relations. Nepal and Bhutan have similar agreements with India, added the minister.  

The deal would be in force for five years instead of the existing tenure of three years.

Regarding fees and charges, the cabinet secretary said the fees would be fixed through discussions between the two countries. “Bangladesh and India would pay the same fees for transporting goods. It's a win-win situation for both sides.” 

The agreement will be renewed in every five years if there is no objection from either side. The extended tenure of the deal would boost the confidence of businessmen, said the cabinet secretary.

It can be amended further through mutual agreement of the parties. In case of cancellation, the interested party would have to send in a notice six months before the expiry of the tenure, mentioned Musharraf.

Cabinet members at the meeting hailed the revised deal saying it would benefit Bangladesh more than India.

Manoj Kumar Roy, additional secretary at the commerce ministry, said the officials of the National Board of Revenue, shipping ministry, and Roads and Highways Department of both the countries would sit soon to fix the transit fees.

Under the revised deal, trucks from Nepal and Bhutan would enter Bangladesh through the Indian corridor. Previously, they were parked at a specific point along the Indian border where goods from Bangladesh were uploaded.

The governments of Bangladesh and India have taken different measures to increase bilateral trade. At present, the trade balance between the two neighbours is heavily tilted in favour of India.

According to experts, India exports goods worth over $5 billion a year to Bangladesh through formal channels. But it is believed that products worth around another $5 billion enter Bangladesh informally.

A minister said Bangladesh would earn a huge amount of revenue from India by allowing it access to Bangladesh territory.