Can Bangladesh-Bhutan Trade Diplomacy Ensure A Win-Win For Both Parties? – OpEd

On March 22 Bhutan and Bangladesh inked a transit deal in Thimpu, the capital city of Bhutan to ease further bilateral trades between the two countries. It is good news for many reasons. Bhutan was the first country in the world that recognized Bangladesh as an independent and sovereign country following the Liberation War in 1971.

Bhutan is one third the size of Bangladesh with a population of less than one million. Bangladesh has in many ways assisting Bhutan for a long time. One of the sectors where Bangladesh helps Bhutan immensely is the medical education. Every year many students from Bhutan receive their medical education from Bangladesh. Even Bhutan’s incumbent Prime Minister Dr Lotay Tshering himself received his medical degree from Bangladesh.

Bhutan opened diplomatic relationship with Bangladesh in 1973 but since then the two countries have not been able to draw benefit out of their relationship as they have no direct border. A 30-km strip of Indian territory separates the two countries making it difficult for them to make the best use of their relationship. Being a landlocked country Bhutan’s main source of export is its hydropower from the Himalayan water resources. With this Himalayan water resources Bhutan has energy surplus. It has also large untapped hydropower potential.

This transit deal will now pave the way for energy import from Bhutan. A bilateral Free Trade Agreement (FTA) has already been signed between the two countries. It was signed in 2009 with emphasize on hydropower export from Bhutan to Bangladesh. After the agreement it is going to get momentum. On the other hand, Bhutan will be able to use our air, railways, river ports, land ports and sea ports since Bhutan is a landlocked country it has no river and seaports of their own.

Some 100 Bangladeshi goods like garment items, fruit juices, particle boards, potatoes, cement, biscuits, cosmetics, sugar, jute or coconut fibre carpets, footwear, corrugated iron sheets, iron rods, cables and dried fish are enjoying preferential duty benefits on export to Bhutan under the Preferential Trade Agreement (PTA). Under the PTA, Bhutanese goods like milk, natural honey, cement clinker, soap, mineral water, portland cement, ferrosilicon, wheat bran, boulder stone, dolomite, gypsum, calcium carbonate, apples, pears, cabbage, cauliflowers, organge, potato, dried chilli and cardamom are enjoying the same benefit.

Now both the countries can maximize the uses of those goods as hopefully prices of those items will come down significantly after the agreement comes into effect. By giving transit facility to Bhutan Bangladesh can also be benefited out of various charges and fees against the products to be imported and exported to and from Bhutan. Furthermore, the country will see infrastructural development and revenue income will increase.

Speaking on the occasion our Commerce Minister Tipu Munshi rightly termed it an epoch-making agreement that would further simplify the trade and commerce between the two countries and will take it to a new height. We hope and believe that this agreement will strengthen diplomatic and economic tie between the two countries. He also stressed the need for increasing bilateral relation in the agricultural sector, especially for increasing the trade of mushroom and other agro-products.

If this can happen, both the countries can enjoy the benefit out of the relation of the two countries. We think that both the countries being peace-loving nations can help each others to tap the potentials of resources they have at their disposals. Of course, it is going to be a win-win situation.

With Bangladesh looking to take the next logical step in its economic journey, it has never been more important for us to build better relationships with other nations, particularly those within South Asia.

Indeed, as we continue to be guided by the principles of the Father of the Nation, Bangabandhu Sheikh Mujibur Rahman, it is “friendship to all and malice to none” that has become our foreign policy mantra — one that we continue to adhere to.

Keeping in mind our foreign policy ambitions, news of the recent agreement signed between Bangladesh and Bhutan this past Wednesday on the movement of traffic in transit is reason for optimism — allowing us to develop stronger ties with a neighbouring nation.

And we could not agree with the Ministry of Foreign Affairs more when they remark that this landmark agreement will certainly help to facilitate trade and commerce between the two countries — leading to shared prosperity for both. Indeed, among criticisms directed at the entirety of the South Asian region has been the relatively poor connectivity that remains in the region, and it is only through bilateral understanding and agreements on the part of all the nations that we will see progress made.

For Bangladesh, these are the sort of conversations and agreements it must continue to pursue and ensure that they are implemented; as has been said repeatedly, with graduation from a least developed country to becoming a middle income economy, we will lose many privileges afforded to LDCs.

It is therefore imperative that we continue with our “friendship to all and malice to none” approach to diplomacy, and together with the assistance of all of our current and potential partners, help Bangladesh fulfil all of its economic goals.