7,132 US products to get duty-free access; Bangladesh restricted with 2,500 items under reciprocal deal
All but 326 US products will enjoy duty-free treatment
Highlights:
- 7,132 US products to get duty-free access in Bangladesh
- 2,500 Bangladeshi products to receive duty-free access in US market
- Products made with US cotton, man-made fiber inputs to get US duty-free access
- 4,922 US products became duty-free in Bangladesh on the day of signing
- Bangladesh will shift sourcing of certain imports to US
- Bangladesh will purchase Boeing aircraft, LNG, LPG, soybeans, wheat, cotton, and military equipment from US
Under a recent reciprocal trade deal signed with US, Bangladesh will grant duty-free access to 7,132 American products, while 2,500 Bangladeshi products will get the same privilege into the world's largest economy.
Chief Adviser Muhammad Yunus disclosed the details in a Facebook post today (15 February), saying that Bangladesh's duty-free list includes a wide range of items such as pharmaceuticals, agricultural goods, plastics, timber, and wood-based products. Bangladesh has a total of 7,458 tariff lines.
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Under the agreement, all but 326 US products will enjoy duty-free treatment. Prior to the signing of the agreement on 9 February, only 441 US products received duty-free access in Bangladesh.
Of the 7,132 US products, Bangladesh made 4,922 tariff lines effective immediately on the day of signing. The remaining items will see a phased reduction in tariffs.
For 1,538 products, tariffs will be reduced to zero over five years. In the first year, duties will be cut by 50%, with the remaining 50% reduced proportionately over the following four years.
Another 672 products will see tariffs phased out over ten years, with an initial 50% reduction in the first year and the rest gradually eliminated over the subsequent nine years.
The chief adviser said that Bangladesh has committed to purchasing certain products from the US that it already imports from other countries. As the US remains the main destination for Bangladesh's RMG exports, the shift in sourcing is aimed at preserving market access without incurring additional costs.
He emphasised that the move involves changing the source of imports rather than increasing overall spending.
According to Yunus, US has signed reciprocal tariff agreements with around 15 countries, including Malaysia, UK, Switzerland, and Bangladesh. Among the publicly available agreements, Bangladesh's "Agreement on BD-US Reciprocal Trade (ART)" shares certain similarities with deals signed with Malaysia and Cambodia.
However, Bangladesh has secured some comparatively favourable terms. For example, in agreements with Malaysia and Cambodia, those countries must consult the US before signing any digital trade agreement with a third party. No such provision exists in the finalised draft of the Bangladesh-US ART.
The chief adviser, however, did not mention any clause restricting Bangladesh from entering trade agreements with non-market economies such as China or Russia.
On rules of origin, Yunus noted that the agreement text does not specify a fixed threshold for foreign or domestic value addition. This flexibility is expected to make it easier for Bangladeshi exports to qualify for duty-free benefits.
The deal also creates opportunities for products manufactured using US-origin cotton and man-made fiber textile inputs to receive duty-free market access in the US.
Key areas covered under the ART include support for paperless trade, intellectual property rights enforcement, a permanent moratorium on customs duties on e-commerce transmissions, reduction of non-tariff barriers and technical barriers to trade, trade facilitation, conformity assessment certification, good governance measures, and procurement of nuclear reactors, fuel rods, or enriched uranium. Bangladesh has also agreed in principle to accede to nine international IPR-related conventions.
The agreement endorses a permanent moratorium on e-commerce duties and allows the import of US medical devices and pharmaceuticals without prior market authorisation, provided they carry certification from the US Food and Drug Administration.
It also commits Bangladesh not to impose restrictions on remanufactured goods and to recognise US sanitary and phytosanitary measures for food and agricultural imports. US certification will be accepted for dairy, meat, and poultry products.
Provisions also include completing agricultural biotechnology registration processes within specified timelines and recognising related food and agricultural products, provided they do not contain living modified organisms.
Bangladesh will follow international standards for live poultry imports, recognise maximum residue limits, and complete market access procedures for plant and plant products within 24 months.
The deal further calls for liberalising equity caps for US investment in insurance, oil, gas, and telecommunications sectors; enforcing anti-corruption regulations; accepting the WTO Agreement on Fisheries Subsidies; refraining from subsidies linked to Illegal, Unreported and Unregulated fishing; and updating Bangladesh's labor laws in line with international labor standards.
In digital trade and technology, the agreement recognises frameworks such as Cross-Border Privacy Rules, Privacy Recognition for Processors, and Personal Data Protection Office standards.
It also includes commitments to safeguard US economic and national security interests and to explore increased imports from the US, including Boeing aircraft, LNG, LPG, soybeans, wheat, cotton, and military equipment.
"Overall, the Agreement on BD-US Reciprocal Trade will help Bangladesh maintain competitiveness in the US market, expand trade globally, attract investment, and deliver economic benefits," Yunus said.
