US tariff: 3rd round talks to be held on issues under non-disclosure agreement 

Commerce Adviser Sheikh Bashir Uddin has said that  the interim government is preparing for a third round of talks with Washington, with hopes of reaching a consensus before the 1 August deadline. 

"We are preparing for the next round of negotiation, and we hope to secure a meeting with the US next week," Bashir informed reporters in a briefing at his secretariat office yesterday. 

During the briefing, the Commerce Adviser did not answer some questions, citing a non-disclosure agreement (NDA) with the United States on the issues.

None saw it coming: What went wrong in Bangladesh’s tariff negotiation with US

The adviser had returned earlier from the US after leading a team for official negotiation from 9 to 11 July with the US government.

He mentioned that the US has raised several matters involving the National Board of Revenue (NBR) and other ministries, necessitating internal discussions to gather their perspectives.

"Not sure about [tariff] reduction"

When asked whether Bangladesh expects a reduction in the 35% additional tariff imposed by the Trump administration, Bashir was non-committal. "I am not sure about the reduction," he said.

Earlier, business leaders had expressed interest in meeting the Chief Adviser, but no such meeting has taken place yet. Monday's 90-minute discussion with the commerce adviser was held shortly after his return from the US.

US focusing on security 

The Business Standard spoke with at least half a dozen exporters and economists who were present at the meeting. While none were briefed on the specifics, many walked away with the impression that the scope of the negotiations has widened.

"Overall, it seems that geopolitical issues will carry significant weight. The United States has many non-tariff concerns related to its security," said Dr Muhammad Abdur Razzaque, chairman of the Research and Policy Integration for Development (RAPID).

"The government did not give any specific answers, so there's no way to fully understand what's going on," he said. "However, it seemed the government wanted to signal that it understands public concern and is taking the matter seriously."

Anwar-ul-Alam Chowdhury Parvez, president of the Bangladesh Chamber of Industries, echoed a similar view. "We're assuming the commerce ministry is negotiating with the country's interest in mind," he said, adding that the ministry is optimistic about a possible tariff reduction.

Razeeb Haider, Director of the Bangladesh Textile Mills Association (BTMA), who attended the meeting, told TBS that the government did not share details of the ongoing discussions due to a NDA with the US on the draft agreement.

"We conveyed our concerns, and the government gave us assurances. We remain optimistic," he said.

A business leader, who attended Monday's meeting with Commerce Adviser Sheikh Bashir Uddin, said the ongoing negotiations with the US appear to be shaped more by political considerations than trade policy alone.

Speaking to TBS on condition of anonymity, the exporter said, "The political issues seem to be bigger than the tariff itself. It appears that the US is using the tariff as leverage to extract broader concessions."

Among the key non-trade issues reportedly raised by the US side are calls for Bangladesh to reduce its reliance on Chinese imports, avoid Chinese investment, and align with Washington's sanctions on third countries, he said.

At the same time, the US is also pressing for effective steps to reduce the existing bilateral trade imbalance, he noted.

"We're hopeful that the tariff will eventually be reduced. But the final decision rests with Trump, so it's difficult to draw any conclusion for now," he said, adding that the outcome of the negotiations may not be finalised by the 1 August deadline and could be delayed by a month or two.

The business leader said industry representatives have conveyed their concerns to the government about the potential impact on Bangladesh's export sector if the 35% tariff takes effect.

He pointed out that, aside from the UK, no other country has secured a tariff agreement under the Trump administration so far.

"India and Vietnam are now our main competitors. If the tariff gap between us and them becomes too wide — if we're made to pay higher duties in the US market — we will lose ground. But if our rates are aligned with theirs, then there isn't much cause for alarm," he said.

Selim Raihan, Executive Director of the South Asian Network on Economic Modeling (SANEM), has cautioned that the United States is using the ongoing tariff negotiations to engage in wider strategic discussions that extend beyond the scope of trade.

"The US is leveraging the tariff issue to open up broader conversations, including strategic and geopolitical matters," he told The Business Standard.

Proceed with caution

Against this backdrop, Raihan said Bangladesh should tread carefully. "If any unreasonable political or geopolitical demands are placed, the government must proceed with caution," he said.

Calling the situation "complex and uncertain," he advised against rushing into decisions. "The government should take a measured approach, consulting all relevant stakeholders before making any move," he added.

Earlier on Sunday, Power and Energy Adviser Fouzul Kabir Khan said the United States initially wants a framework agreement with Bangladesh, which includes various issues, including their security concerns.

"There has been significant progress in the discussions between the US and Bangladesh regarding this matter over the past few days. After this, discussions will be held on tariff and non-tariff issues," he said at a press conference organised by the committee formed to make business, trade, industry, ports, and revenue more dynamic at the Secretariat on 13 July.

When asked about what sorts of security concerns the US has, the energy adviser said Commerce Adviser Sheikh Bashir Uddin can say it better when he returns.

Commerce Secretary Mahbubur Rahman, who has been involved in the negotiation process since the beginning and was present at the adviser's briefing, dismissed suggestions that the US had demanded 40% local value addition for products labeled 'Made in Bangladesh'.

"I have never heard of such a requirement for Bangladeshi goods," he said.