Dhaka hesitant to sign FTA with neighbours
The Financial Express
Dhaka hesitant to sign FTA with neighbours
Sunday April 03 2005
Bangladesh is hesitant to take any practical move to sign free trade agreement (FTA) as it has been sitting on several proposals from many neighbouring countries that have done so among themselves for their own benefits.
Analysts say the FTA aims to bolster bilateral economic cooperation and encourages investment flows. It will open doors to greater market access and lower prices on both sides.
Senior diplomats in Dhaka and chamber leaders believe that Bangladesh should not waste any more time and rather go ahead to seal such deals to raise regional exports and attract investment.
"We showed interest in signing the Free Trade Agreement with Bangladesh and I made the proposal to the government last year," said Akmal Ghani, the Ambassador of Afghanistan to Bangladesh.
He alleged that many of the Afghan products were being sold in Bangladesh with Indian or Pakistani brand levels. "It is clear that our products are popular in Bangladesh. So why don’t we sign an FTA and offer better prices to the Bangladeshi customers?" asked the Ambassador.
A top Sri Lankan diplomat said recently that his country was interested to go for an FTA with Bangladesh and an official proposal was sent to the government in 2003. A visiting Pakistani business delegation also expressed their strong willingness to reach the deal with Bangladesh to multiply bilateral trade and investment.
The Sri Lankan diplomat said his country was receiving good results after signing FTA with India and trade between these two nations increased significantly after the arrangement was done. Seeing the benefits, the island nation recently signed another FTA with Pakistan.
A landlocked country Bhutan also sent a proposal to Bangladesh years ago showing interest in FTA deal.
"If Bangladesh signs FTA with us, it could export her products to India with which we have another FTA," said a top Bhutan diplomat recently.
Bangladesh is the only country in the region that does not have any FTA deal with any country and nonchalant officials do not want to talk about the fate of the proposals.
An official of the Ministry of Commerce, who studies the proposals, said many countries in the region have proposed for FTAs but the government is "studying the pros and cons of the proposals." He could not explain why the study was taking such a long time, more than two years, in some cases.
Rashed Maksud Khan, a former chief of Dhaka Chamber of Commerce and Industry, said he believed the respective government officials do not understand well about the outcome of an FTA. It looks like the political leaders lack vision.
"It is like leaders swallowing pills to get cured of a pain rather than searching for the actual reason of the ache," Khan said criticising the fear of the government regarding signing of FTA that ’such agreements might be detrimental to the economy.’
Commerce Ministry adviser Barkat Ullah Bulu said: "We never know the exact outcome of an FTA. We need to study thoroughly before signing such pact."
He said the government was studying the proposals and wanted to make sure that FTA does not harm local industries.
The commerce adviser said Bangladesh might make decision about signing FTAs with the neighbouring states this year. He said Pakistani delegates are interested in setting up textile mills that might benefit Bangladeshi garment exporters.
