Here’s a piece of good news for all Bangladeshi exporters. The country’s overall exports to its neighbour India increased significantly in 2018-19 fiscal to cross the US $ 1 billion mark for the first time ever!
India, after Poland, became the second country to join the billion-dollar club this year, while USA, Germany, United Kingdom, Spain, France, Italy, Canada, Japan and Netherlands are already importing more than a billion-dollar-worth goods from Bangladesh.
According to figures released by Bangladesh’s Export Promotion Bureau (EPB), the country’s exports to India stood at US $ 1.25 billion, up by 42.91 per cent, which was US $ 873.27 million in the previous fiscal. What’s more of the total amount, the apparel sector contributed US $ 499.09 million (in 2018-19 fiscal), which is 79.09 per cent higher compared to US $ 278.67 million in the previous year.
Knitwear exports earned US $ 369.43 million while woven items fetched US $ 129.66 million.
As per experts, there are a slew of reasons behind this spurt in exports, primary amongst which are the so-called ease of non-trade barriers, duty-free market access to India, incentives for non-traditional markets (as provided by Bangladesh), rise in production cost in India due to implementation of Goods and Services Tax (GST), and the ever-increasing presence of global retailers in the neighbouring country, which all have contributed to this sharp rise.
“India is a growing market for Bangladesh, where non-tariff barriers were hindering exports. In recent times, these barriers are relaxed to some extent,” explained World Bank Lead Economist in Bangladesh Zahid Hussain speaking to the media, while former Vice-President of BGMEA Shahidullah Azim on his part maintained, “Bangladesh offers apparel goods at reasonable prices, while global retailers are opening more outlets in India, who buy products from here. Production costs in India also increased due to implementation of the GST.”
Zahid further advocated trade negotiations between the two neighbours to remove the remaining non-tariff barriers while launching a joint initiative to develop harmonised standard of goods.
Bangladesh, however, is yet to fulfil the full potential and the current achievement is just an indication of what’s lined up for the future, felt many experts.
“India has become a billion-dollar export market for Bangladesh. It is a good sign, which indicates that regional market is becoming more exciting and highly potential,” underlined Research Director of Centre for Policy Dialogue (CPD) Khondaker Golam Moazzem while highlighting that population-wise India is the second largest country after China and that too with better purchasing power.
So, there is a huge scope for Bangladesh to grow its exports further, feels Khondaker. But to do, the research director’s advice to Bangladesh is to look beyond just apparel export and concentrate on consumers goods as well.