US trade deal can't be cancelled at will; we want to make most of it: Commerce minister

The US-Bangladesh reciprocal trade agreement cannot be cancelled at will, and the government wants to maximise its benefits, Commerce Minister Khandaker Abdul Muktadir has said.

"An agreement between states is not like a private contract that can be revoked at will…We want to utilise it to the fullest to expand trade and investment," he told the media following a meeting with US Assistant Trade Representative for South and Central Asia Brendan Lynch at the commerce ministry today (5 May).

He pointed out that the agreement contains self-correcting elements. "If any provision of the agreement is found to be contrary to Bangladesh's interests, there is scope to amend it within the existing framework."

Various economists and research organisations have called for scrapping the agreement signed with the US during the interim government's tenure, just three days before the national election. They argue that the deal goes against Bangladesh's interests, with some calling for its cancellation.

On these concerns, the minister said there is no need for undue alarm over the trade agreement. "International agreements are built on coordination between the two sides to create a win-win situation," Muktadir said.

He also said the BNP government did not initiate the agreement but inherited it.

A ministry official, on condition of anonymity, told TBS that the USTR officials advised Bangladesh to focus on implementing the agreement. They said the deal would bring benefits for Bangladesh, and compliance would help the country gain economically.

'Dumping allegations baseless'

The US has launched investigations into the manufacturing sectors of 16 economies, including Bangladesh, to assess whether their policies and production practices are contributing to global overcapacity that could harm US manufacturing.

On the probe, Minister Muktadir said Bangladesh had sought clarification and conveyed its position after reviewing the explanation provided. "We clearly said it would have been more positive if such an investigation had not been initiated within the context of the existing agreement," he said.

He rejected concerns over overcapacity and dumping, saying Bangladesh imports most of its goods and maintains strict compliance in export industries. "Our main export sector, ready-made garments, operates under international standards. There is no scope for labour law violations or child labour."

On 2 April 2025, the US imposed reciprocal tariffs on several countries at varying rates to narrow its trade deficit. The Trump administration initially set a 37% tariff on Bangladeshi goods, later reduced to 20% in August. After nine months of negotiations, both sides signed the Reciprocal Trade Agreement on 9 February, bringing the rate down further to 19%.

Under the deal, Bangladesh's main export, ready-made garments, will face zero reciprocal tariff if produced using US-origin cotton and man-made fibres.

Bangladesh got better deal than others: Khalilur

The USTR delegation also met Foreign Minister Khalilur Rahman today. Khalilur led Bangladesh's negotiations on the agreement during the interim administration in his role as national security adviser.

After the meeting, he told reporters that it was positive that the agreement was being publicly discussed.

"Didn't Bangladesh agree to 'shall' in 131 places? We are not the only country to sign such an agreement. Others have done so as well. Indonesia has used 'shall' in 231 places. If you read Bangladesh's agreement alongside those of Indonesia, Vietnam, Cambodia and others, you will understand it better," he said.

He was referring to a recent media report, noting that in legal drafting, "shall" denotes a binding obligation, while "will" generally indicates intent or discretion. In Bangladesh's US trade agreement, "Bangladesh shall" is used 131 times, while "US shall" appears six times, according to the report.

Replying to another question, he said the debate should be properly contextualised as the US has introduced reciprocal tariffs for all countries. He said other countries also negotiated reductions, with Vietnam at 20% and Bangladesh at 19%.

He added that comparing Bangladesh's deal with others would clarify tariff levels, policy commitments and purchase obligations, saying the full picture emerges only through such a comparison.