India Bangladesh Trade

India Bangladesh Trade:

• India Bangladesh Trade, Bangladesh is the largest trade partner for India in South Asia and the fourth largest destination for India Bangladesh Trade exports worldwide in 2021-22.
• Exports: In India Bangladesh Trade, Exports to Bangladesh rose by more than 66 per cent from $9.69 billion in FY 2020-21 to $16.15 billion in FY 2021-22.
  • In India Bangladesh Trade Main exports to Bangladesh are raw cotton, non-retail pure cotton yarn, and electricity.
• Imports: India Bangladesh Trade, Bangladesh second biggest trade partner, and the largest export market in Asia.
  • Main imports from the country are pure vegetable oils, non-knit men’s suits, and textile scraps.

India Bangladesh Trade: CEPA

• The CEPA will be focusing on trade in goods, services, and investment, with a key objective of reducing the trade gap between the two countries.
• Importance for Bangladesh: Bangladesh will graduate into a developing country by 2026 and will no longer qualify for trade benefits that it currently enjoys as a least-developed country.
  • Having a comprehensive trade agreement with major countries is very critical for its growth.

India Bangladesh Trade: Existing Framework

• Bilateral Trade Agreement: India Bangladesh Trade agreement was renewed in 2015 for a period of five years with a provision for auto renewal.
• South Asian Free Trade Area (SAFTA): India Bangladesh Trade, Bangladesh offers preferential tariffs to Indian exports of products apart from those in ‘sensitive list’ of 993 items.
  • India in 2011 announced duty-free, quota-free access to Bangladesh for all tariff lines except tobacco and alcohol.
• Protocol on Inland Waterways Trade and Transit (PIWTT): It will facilitate trade and transit through inland waterways.
  • The protocol ensures movement of goods by barges/ vessels on eight routes between India and Bangladesh, as well as between points in India through Bangladesh for increasing India Bangladesh Trade .
• Memorandum of Understanding (MoU) on Coastal Shipping: MoUs were signed in 2015 on the use of the Chittagong and Mongla Ports for Movement of Goods to and from India. It concerns direct sea movement of containerized/ bulk/ dry cargo.
  • This reduces the shipping time between India and Bangladesh from 30-40 days to 7-10 days.
• Border Haats: The MoU on Border Haats was renewed in April 2017. Currently, four Border Haats — two each in Meghalaya (Kalaichar and Balat) and Tripura (Srinagar and Kamalasagar) — are functional.
  • There are plans to set up two more haats on the Tripura-Bangladesh border and four on the Meghalaya-Bangladesh border is under way.

India Bangladesh Trade: Important Agreements During Bangladesh’s PM Visit

• River water sharing: India and Bangladesh have signed an interim water sharing agreement for the Kushiyara river. This was first such agreement in last 25 years.
  • The signing of Kushiyara river sharing pact will benefit people in southern Assam and Sylhet in Bangladesh.
• Mujib scholarship: Bangladesh has announced Mujib scholarship for the direct descendants of the Indian soldiers killed or grievously injured in the 1971 Bangladesh Liberation War.

Kushiyara River:

• Kushiyara is a distributory of the Barak river and forms a part of India-Bangladesh border.
• The river is formed when Barak river divides into Kushiyara and Surma.
• Kushiyara rejoins Surma in Bangladesh to form the Meghna river.

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