Framework agreement: What experts say about US 'security concerns' regarding Bangladesh

During the recently concluded second round of tariff negotiations with Bangladesh, the United States expressed interest in establishing an initial framework agreement that would address a range of issues, including its security concerns.

Sharing the development with the media today (13 July), Energy Adviser Fouzul Kabir Khan said Commerce Adviser Sheikh Bashir Uddin, who led the Bangladesh delegation during the tariff talks in Washington DC last week, will elaborate on the issue when he returns home.

According to experts, China is bound to be a big factor in the US security concerns regarding Bangladesh.

US wants a framework agreement with Bangladesh that includes their security concerns: Fouzul

Speaking to The Business Standard, they said Washington may seek Dhaka's alignment with its Indo-Pacific Strategy, a comprehensive US strategy aimed at strengthening economic and security cooperation across the region to counterbalance Beijing.

During the tariff talks, the US has raised concerns over the rising volume of Chinese investment in Bangladesh and the increasing transfer of ownership of local companies to Chinese entities.

A senior commerce ministry official, requesting anonymity, told TBS last Friday, "A key focus of the tariff talks is the Rules of Origin, requiring 40% local value addition to access the US market. This stems from Washington's concern over Bangladesh's reliance on Chinese inputs, reflecting its broader strategy to counter China's economic influence."

'US wants to ensure Bangladesh doesn't tilt excessively towards China'

Sketch: TBS

M Humayun Kabir, former Bangladesh ambassador to the US and current president of the Bangladesh Enterprise Institute (BEI), told TBS that the US is keen to ensure that Bangladesh does not lean too heavily towards China in its geopolitical and economic engagements.

Referring to recent talks with US officials, he said, "The adviser [Fouzul] has mentioned that the US is seeking a framework agreement with Bangladesh that includes security issues. This suggests they want to ensure that, alongside trade relations, we do not excessively tilt towards China. They also want us to align with their Indo-Pacific Strategy. So, I believe the US wants to engage with Bangladesh on these broader issues."

He added, "From the adviser's statement, it seems that our talks with the US are not limited to trade negotiations. They want a deeper engagement with us in a wider strategic context."

Humayun said it is important that Bangladesh assess its own needs clearly in these discussions. "Since the US is a global power, it will naturally have many expectations. But we need to conduct a comprehensive internal assessment to identify our own priorities and then cooperate with the US where feasible. We may not be able to accommodate everything they want."

Explaining the economic intricacies, the former diplomat said, "China is one of our largest trading partners. We import raw materials from them, add value, and export the finished products to the US. If that supply chain is disrupted, it will become dangerous for our trade. So, we need to cooperate with the US where possible but also clearly communicate our limitations and secure our own economic interests."

He added that we have to make the US understand that we do not have the capacity to completely avoid China. "For example, if the US wants, perhaps we can agree not to pursue deep military cooperation with China [hypothetically], but on the trade front, we cannot cut ties."

Stressing the need for a long-term national strategy, Humayun said, "We must develop a comprehensive national position through deep consultations. Considering the growing US-China rivalry and the weakening role of the WTO, we need to craft policies that balance our relationships based on our own national interests."

'US wants security provisions in deal, but Bangladesh's preparation weak'

Sketch: TBS

Security and defense expert Major General (retd) ANM Muniruzzaman, the president of Bangladesh Institute of Peace and Security Studies (BIPSS), told TBS that unless the government clearly states what specific elements the US wants to include in the proposed framework agreement with Bangladesh, it is not possible to comment in detail on the nature of the security provisions.

When asked whether US concerns regarding any possible Bangladesh-China-Pakistan trilateral axis might be addressed in the agreement, he said, "No, this is much deeper than that. But I don't want to speculate at this point."

Asked about the broader US security concerns with Bangladesh, he said, "The US' primary issue in its global strategic outlook right now is China. Their broad strategic concerns are all China-related. As for specific issues concerning Bangladesh, I believe it would be maritime security. That's where they may want to bring something specific."

On the implications of Bangladesh rejecting US security demands, he warned, "If Bangladesh refuses what the US wants in terms of security cooperation, the US is unlikely to offer any tariff concessions."

Muniruzzaman also criticised the way the negotiations have been handled. "The type of negotiation team that should've been sent was not sent. The private sector should've been fully embedded in this because they understand these issues. Look at Vietnam – they hired powerful trade lobbyists who knew the full path of negotiation. We did nothing of that sort."

Highlighting institutional shortcomings, he added, "The first round of negotiations was held without proper representation from the commerce ministry. The national security adviser was negotiating – and he is not the right person to negotiate trade deals. We've made a series of missteps, and now, at the last moment, our hands are tied."

When asked whether Bangladesh could avoid engaging with China if the US explicitly demanded so, the security expert said, "That would be very difficult – almost impossible. China is our largest trading partner and also the biggest source of our defense procurements. These are areas where comprehensive studies should've been done well in advance."

Regarding the overall negotiation status with the US, he said, "Negotiations haven't been handled properly. That's why now we're negotiating from a point of weakness, making it easier for the US to impose terms.

"Vietnam already finalised their negotiation one and a half to two months ago. They negotiated a 20% tariff. Vietnam is our direct competitor in ready-made garments. If they get a 20% rate and we get higher than that, our market [in the US] is gone."

He added, "India is also likely to negotiate 20% or even lower. If so, our main competitors will be negotiating far better tariff rates than us."