Exports slump as Delhi continues to put non-tariff, para-tariff barriers
The country’s trade gap with India swelled to US$ 2.59 billion in the first half of the current fiscal year and could hit US$ 5-billion in the year-end due to falling exports amid continuous non-tariff and para-tariff barriers imposed by New Delhi, officials said. Bangladesh’s exports to India slumped to US$ 182.48 million in July-December of the current FY 2013-14 whereas imports soared to US$ 2.78 billion during the period.
Trade gap with India in July-December in FY 2012-13 was US$ 2.05 billion with an export figure of US$ 267.26 million and import of US$ 2.31 billion.
Officials and economists blamed non-tariff barriers due to protectionist attitude by India for the rising trade gap amid slumping exports from Bangladesh.
They said with the current trend, the annual trade gap, which came down to US$ 4.17 billion in FY 2012-13 from US$ 4.24 billion in FY 2011-12, would cross a record US$ 5 billion this fiscal year.
Available government data showed that although exports of readymade garments to India increased during the first half of the current fiscal year, exports of other products like jute and fruits reduced drastically.
Former finance adviser to interim government Mirza Azizul Islam said that India’s protectionist attitude to shield their jute sector resulted in slump in jute exports to India.
He said Bangladesh exports to India was also affected because domestic production hampered amid political unrest.
The country exported jute and jute items worth only US$ 28 million and fish products worth US$ 9 million to India in July-December against US$ 63 million and US$ 26 million respectively during the same period in last fiscal year.
He said non-tariff and para-tarrif barriers imposed by India had been pending issues for long as the Indian bureaucrats were reluctant to address the problem.
Mirza said imports from India rose because of higher inflow of industrial raw materials and capital machineries and food items.
He said that rise in garment exports to India was also helping their consumers and entrepreneurs who had set up a huge number of garment factories in Bangladesh.
‘Indian consumers are getting cheaper clothes and their entrepreneurs who have set up garment units here are making huge profits,’ he said.
RMG exports to India stood at $ 53 million in July-December against US$ 34 million during the same period last year.
Businessmen said harsh testing requirement, complex customs system, inadequate infrastructure are among major non-tariff barriers that Indian authorities imposed to hinder Bangladeshi exports.
Federation of Bangladesh Chambers of Commerce and Industry president Kazi Akramuddin Ahmed said India had provided duty-free and quota-free market access to Bangladeshi products, but the local businesses were yet to reap the benefits mainly due to non-tariff and para-tariff barriers.
Commerce secretary Mahbub Ahmed said they always asked authorities in India to remove tariff and para-tariff on Bangladeshi products.
‘They have been assuring us of looking into the matter,’ he said.
The World Bank in a report on the trade between Bangladesh and India revealed that Bangladeshi exports to India received tariff concessions under South Asian Free Trade Area, but those account for less than 1 per cent of total Indian imports.
-With New Age input
