India Bangladesh Trade
India Bangladesh Trade Agreement
Last updated: Mar, 2024
Introduction
India and Bangladesh share bonds of history, language, culture, and a multitude of other commonalities. The relationship between the two nations goes far beyond a strategic partnership. India was one of the first countries to recognize Bangladesh and establish diplomatic relations immediately after its independence in December 1971. The excellent bilateral ties reflect a strong partnership based on equality, trust, sovereignty, and understanding.
India-Bangladesh Trade
- Bangladesh is India’s biggest trading partner in the subcontinent and India is the second biggest export partner accounting for 12% of the total exports to Bangladesh.
- The total trade turnover in FY23 touched US$ 14.22 billion.
Major exported items from India to Bangladesh with amount & quantity
- India exported 6,052 commodities to Bangladesh in FY23.
- India’s export to Bangladesh stood at US$ 12.20 billion in FY23 and US$ 16.15 billion in FY22.
- Major principal commodities exported from India to Bangladesh include other commodities (US$ 1.17 billion), followed by cotton yarn (US$ 1.02 billion), petroleum products (US$ 816 million), other cereals (US$ 556 million), and cotton fabrics, made-ups, etc. (US$ 541 million), among others in FY23.
- Exports to Bangladesh during April-November 2023 stood at US$ 6.98 billion.
- Major principal commodities exported from India to Bangladesh include engineering goods (US$ 1.48 billion), followed by other commodities (US$ 1.42 billion), cotton yarn, fabrics, made-ups, handloom products etc. (US$ 1.20 billion), petroleum products (US$ 675 million), and organic and inorganic chemicals (US$ 430 million), among others in April-November 2023.
Major imported items by India from Bangladesh with amount & quantity
- India imported 1,154 commodities from Bangladesh in FY23.
- India’s imports from Bangladesh stood at US$ 2.02 billion in FY23 and US$ 1.97 billion in FY22.
- Major principal commodities imported by India from Bangladesh include RMG cotton (US$ 510 million), followed by cotton fabrics, made-ups, etc. (US$ 153 million), RMG man-made fibers (US$ 142 million), spices (US$ 125 million), and jute (US$ 103 million) in FY23.
- Imports from Bangladesh during April-November 2023 stood at US$ 1.29 billion.
- Major principal commodities imported by India from Bangladesh include articles of apparel and clothing accessories, not knitted or crocheted (US$ 274 million), followed by aircraft, spacecraft, and parts thereof (US$ 172 million), articles of apparel and clothing accessories, knitted or crocheted (US$ 152 million), other vegetable textile fibers (US$ 149 million), and other made-up textile articles (US$ 92 million) in April-November 2023.
Economic Relations and Investments
- The 15th meeting of the Joint Working Group on Trade (JWG) between India and Bangladesh took place on September 26th and 27th, 2023, in Dhaka, Bangladesh. The discussions covered a range of bilateral issues, including the elimination of port restrictions, preparations for the initiation of the Comprehensive Economic Partnership Agreement (CEPA), standard harmonization, mutual recognition of standards, the supply of essential commodities to Bangladesh, the enhancement of road and rail infrastructure, regional connectivity through multi-modal transportation, and the establishment/strengthening of infrastructure in Land Customs Stations/Integrated Check Posts, border haats, etc. On the trade front, India and Bangladesh have agreed to start the Comprehensive Economic Partnership Agreement (CEPA) at an early date. CEPA would provide a sound basis for substantial enhancement of trade and commercial partnership between the two countries, and it would also create new jobs, raise living standards, and provide wider social and economic opportunities in India and Bangladesh. The productive bilateral meeting concluded with both nations reiterating their commitment to deeper economic engagement, regional cooperation, and sustainable development.
- In April 2023, Bangladesh and India agreed to settle a part of the bilateral trade transactions in their own currencies-Rupee and Taka, to ease pressure on dollar holdings.
- NTPC marked it first overseas capacity addition by adding Unit-1 of the 1320 MW (2x660) Maitree Super Thermal Power Plant (MSTPP) located in Rampal, Mongla, Bagerhat, Bangladesh. The project was executed in collaboration with the Bangladesh-India Friendship Power Company Pvt Ltd. (BIFPCL), a foreign joint venture company of NTPC Ltd.
- Indian railways, under grant assistance from the Government of India, handed over 20 Broad Gauge (BG) diesel locomotives to Bangladesh, fulfilling an important commitment made during the visit of Hon’ble Prime Minister of Bangladesh Sheikh Hasina to India, in September 2022.
- India and Bangladesh engaged in discussions on various bilateral matters including the exploration of new land customs stations, streamlining port restrictions, advancing road and rail infrastructure, facilitating pre-arrival exchange of customs data, and deliberating on a bilateral agreement for customs cooperation during the 14th Joint Group of Customs (JGC) meeting in August 2023 in New Delhi.
Recent Trends & developments
Ms. H.E. Sheikh Hasina, Prime Minister of the Government of the People’s Republic of Bangladesh, paid a state visit to India from September 5-8, 2022, at the invitation of the Prime Minister of India Mr. Narendra Modi. The following MoUs and Agreements were signed and exchanged during the visit:
- MoU between the Ministry of Jal Shakti, Government of India, and Ministry of Water Resources, Government of Bangladesh on the withdrawal of water by India and Bangladesh from Common Border River Kushiyara.
- MoU between the Ministry of Railways, Government of India, and the Ministry of Railways, Government of Bangladesh on the training of Bangladesh railway personnel in India.
- MoU between the Ministry of Railways, Government of India, and the Ministry of Railways, Government of Bangladesh on collaboration in IT systems such as FOIS and other IT applications for Bangladesh Railway.
- MoU on scientific and technological cooperation between the Council for Scientific & Industrial Research (CSIR), India, and the Council of Scientific & Industrial Research (BCSIR), Bangladesh.
- MoU on cooperation in the areas of space technology between NewSpace India Limited and Bangladesh Satellite Company Limited.
- MoU between Prasar Bharti and Bangladesh Television (BTV) on cooperation in broadcasting.
- MoU between the National Judicial Academy, India, and the Supreme Court of Bangladesh on Training and Capacity Building Program for Bangladesh Judicial Officers in India.
Prime Minister Mr. Narendra Modi had a bilateral meeting with Prime Minister of People's Republic of Bangladesh Ms. H.E. Sheikh Hasina, on the eve of the G-20 Leaders’ Summit from September 9-10, 2023. The two leaders discussed bilateral cooperation including political and security cooperation, border management, trade and connectivity, water resources, power and energy, development cooperation, cultural and people to people ties. The two leaders welcomed the exchange of following MoUs during the meeting for strengthening the bilateral cooperation:
- Memorandum of Understanding on Cooperation in Digital Payment mechanisms between National Payments Corporation of India (NPCI) and Bangladesh Bank.
- Memorandum of Understanding on renewal of the Cultural Exchange Program (CEP) between India and Bangladesh for 2023-2025.
- Memorandum of Understanding between Indian Council of Agricultural Research (ICAR) and Bangladesh Agriculture Research Council (BARC).
Conclusion
The multi-dimensional cooperation between the two countries ranges from traditional tourism, health, and education sectors to frontier technologies of nuclear science, space, and information technology. Bangladesh is the largest source of foreign tourists. The two countries are looking forward to collaborating in new areas of cooperation, such as the environment, climate change, cyber security, ICT, space technology, green energy, and the blue economy.
Contacts
- High Commission India, Bangladesh
Address: Plot No: 1-3, Park Road, Baridhara, Dhaka 1212,
Telephone: +00880-2-55067647
Officials
Mr. Pranay Verma - High Commissioner
Contact: +880-2-55067310
Email: hc.dhaka@mea.gov.in
Dr. Binoy George - Deputy High Commissioner
Contact: +880-2-55067312
Email: dhc.dhaka@mea.gov.in - Embassy of Bangladesh, India
Address: EP-39, S Radhakrishna Marg, Chanakyapuri, New Delhi, Delhi 110021
PABX: +91 11 2412 1391-94
FAX: (91-11)26878953
Email: mission.newdelhi@mofa.gov.bd
Officials
H. E. Mr. Md. Mustafizur Rahman (High Commissioner)
Mr. Md. Nural Islam (Deputy High Commissioner)
Dr. A.K.M. Atiqul Haque (Minister (Commerce)
Partners
