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Dhaka to extend trade agreement with India
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India and Bangladesh have signed the Protocol on Inland Water Transit and Trade in 1980. It is not allowed to lapse whoever is in power in Dhaka. In fact, the protocol is regularly given a three-year extension, which shows that there is across the board national consensus on the validity of the trade pact.
The Bangladesh government will extend existing bilateral trade agreements with India for another three years. The decision was taken during an inter-ministerial meeting on November 15 at the Commerce Ministry, with Additional Secretary Murtaza Reza Chowdhury in the chair.
The trade act originally was signed in 1980 as the parent agreement for the Protocol on Inland Water Transit and Trade (PIWTT). It will expire on 30 March 2012.
Protocol on Inland Water Transit and Trade was also extended by the two countries on February 13 this year for a further year.
Hasina government after coming to power in March 2009 extended these agreements for three years. Its predecessor, the four-party led BNP government extended it in March 2006. Thus there is national consensus on the validity of these trade pacts.
The agreement is a framework to bolster and facilitate trade and commerce between the two countries, according to Bangladesh Commerce Minister Faruk Khan. He said both countries have the option of incorporating new issues, including charges into the agreement. For the present the issue is not being addressed as the Bangladesh’s national core committee on transit and transhipments has not yet completed its exercise. ‘The government cannot do much. We will have to wait for the core committee report for revisiting the issue’.
The Treaty has twin objectives. One allow India to transport goods to north-eastern states through Bangladesh; two let Bangladesh transport its goods to Nepal and Bhutan to pass through India. While the first objective has been achieved, the second is yet to be realized.
According to Article 8 of the trade pact, the two countries agreed to mutually beneficial arrangements for the use of waterways, roads and railways for commerce and the passage of goods through each other’s territory. It grants merchant vessels to enter, put off and anchor at its ports. It is the most-favoured-nation treatment accorded by their respective laws, rules and regulations to the vessels under the flag of any third country. According to the article, the two governments agree that expanding mutual trade will make an important contribution towards development.
A recent World Bank report said Bangladesh and India would greatly benefit from cooperating in other areas, without necessarily implementing an FTA.
The report said, “Improvements in transport, storage and administrative infrastructure at land borders would yield substantial benefits. Greater harmonization and cooperation in customs administration and banking relationships would also be highly beneficial.”
Progress could also be made in tackling illegal trade, which by some estimates, could be as high as three quarters of legitimate trade.
The trade act originally was signed in 1980 as the parent agreement for the Protocol on Inland Water Transit and Trade (PIWTT). It will expire on 30 March 2012.
Protocol on Inland Water Transit and Trade was also extended by the two countries on February 13 this year for a further year.
Hasina government after coming to power in March 2009 extended these agreements for three years. Its predecessor, the four-party led BNP government extended it in March 2006. Thus there is national consensus on the validity of these trade pacts.
The agreement is a framework to bolster and facilitate trade and commerce between the two countries, according to Bangladesh Commerce Minister Faruk Khan. He said both countries have the option of incorporating new issues, including charges into the agreement. For the present the issue is not being addressed as the Bangladesh’s national core committee on transit and transhipments has not yet completed its exercise. ‘The government cannot do much. We will have to wait for the core committee report for revisiting the issue’.
The Treaty has twin objectives. One allow India to transport goods to north-eastern states through Bangladesh; two let Bangladesh transport its goods to Nepal and Bhutan to pass through India. While the first objective has been achieved, the second is yet to be realized.
According to Article 8 of the trade pact, the two countries agreed to mutually beneficial arrangements for the use of waterways, roads and railways for commerce and the passage of goods through each other’s territory. It grants merchant vessels to enter, put off and anchor at its ports. It is the most-favoured-nation treatment accorded by their respective laws, rules and regulations to the vessels under the flag of any third country. According to the article, the two governments agree that expanding mutual trade will make an important contribution towards development.
A recent World Bank report said Bangladesh and India would greatly benefit from cooperating in other areas, without necessarily implementing an FTA.
The report said, “Improvements in transport, storage and administrative infrastructure at land borders would yield substantial benefits. Greater harmonization and cooperation in customs administration and banking relationships would also be highly beneficial.”
Progress could also be made in tackling illegal trade, which by some estimates, could be as high as three quarters of legitimate trade.
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