CPD urges govt to scrap US trade deal, proposes reforms in 13 sectors
Taking a firm stance on recent international negotiations, the CPD warned that the US trade agreement severely jeopardises Bangladesh’s smooth transition strategy (STS) for LDC graduation
The Centre for Policy Dialogue (CPD) has urged the newly elected government to immediately scrap the reciprocal trade agreement signed with the United States by the previous interim administration, terming it grossly discriminatory and detrimental to Bangladesh's economic sovereignty.
The think tank also called for a complete departure from the traditional business as usual bureaucratic approach, unveiling a comprehensive 13-sector policy roadmap to guide the government's executive and legislative decisions over the first 180 days and the next five years.
The recommendations were presented today (28 February) at a media briefing titled "New government's economic and social sector policy and administrative decisions: 180 days and beyond," held at the CPD office in Dhaka.
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CPD research director Khondaker Golam Moazzem presented the extensive analysis, emphasising that the new administration must adopt knowledge-based decision-making and deeply decentralise power to overcome systemic inefficiencies.
Taking a firm stance on recent international negotiations, the CPD warned that the US trade agreement severely jeopardises Bangladesh's smooth transition strategy (STS) for LDC graduation.
According to the think tank, the agreement's clauses completely restrict Bangladesh's independence in terms of trade and investment with third countries. It forces Bangladesh to comply with US border measures and restricts the imposition of digital service taxes.
The CPD strongly advised the government to withdraw from this agreement before notifications are exchanged and also urged a review of the Economic Partnership Agreement (EPA) with Japan, as it controversially allows duty-free imports of LNG, thereby delaying the country's renewable energy transition.
Beyond trade, the CPD's analysis spanned critical macroeconomic areas, including resource mobilisation, the business environment, and foreign direct investment (FDI). With the country's tax-to-GDP ratio plunging to a South Asian low of 6.8%, the think tank recommended forming a tax ombudsman, consolidating the current eight VAT slabs into a three-tier structure, and eliminating tax incentives for high-emission fossil fuel power producers.
To attract FDI and ease the cost of doing business, CPD proposed enacting a Single Digital Interface Act to legally bind ministries to integrate their databases. They also suggested translating the government's pledges of 48-hour company registration and 30-day profit repatriation into enforceable legal standards, alongside establishing specialised commercial courts for rapid dispute resolution.
Turning to the power and energy sector, the CPD heavily criticised the government's ambitious target to generate 35 GW of electricity by 2030.
"There is no need to fix the BNP's distant target of 35 gigawatts for 2030. Because within that target, we again see an indication of promoting fossil fuels. Therefore, we believe that instead of sticking to the 35-gigawatt target, it would be better to move towards a more realistic goal – as CPD had suggested – that reaching 30 gigawatts by 2040 would be sufficient. We think the new government should proceed with such a target in mind," said Dr Golam Moazzem.
Instead of expanding domestic coal extraction and building new inland LNG terminals, the government was advised to adopt a strict 'no new fossil fuel-based power generation' policy.
The think tank recommended shifting focus toward domestic gas exploration through Bapex, expanding the national rooftop solar programme, and inserting 'No Electricity, No Pay' clauses in all future power purchase agreements to eliminate the heavy burden of unconditional capacity charges.
On the social front, the CPD addressed pressing issues surrounding labor rights, child labour, and international migration.
Addressing the alarming rise in child labour, which currently traps 3.5 million children, Golam Moazzem proposed utilising the newly planned Family Card scheme to provide conditional cash transfers to vulnerable households, strictly tied to withdrawing their children from hazardous work and sending them back to school.
To protect outbound migrant workers from rampant extortion, the government was urged to dismantle entrenched recruitment syndicates, mandate digital financial transactions for all recruitment fees, and transform Technical Training Centres (TTCs) into dedicated overseas placement hubs aligned with global market demands.
Golam Moazzem said true accountability cannot be achieved if the government operates solely on the "one leg" of the executive branch. He strongly advocated for parliamentary reforms.
CPD recommended ensuring that opposition MPs lead key parliamentary standing committees, such as the Public Accounts Committee, and reforming the Prime Minister's Question Time to be ballot-based rather than executive-controlled.
