Nepal-Bangladesh ties Further enhancement potential


Both countries, Bangladesh and Nepal, are members of SAARC, BIMSTEC, NAM and South Asian Growth quadrangle and work closely in international forums on matters of bilateral, regional and international interests. Exchange of visits at various levels has further developed bilateral relations between the two countries. However, there exists tremendous potentiality to further develop the political, economic, trade, cultural and military

relations between two

most friendly countries in the region.

Bangladesh has the 31st largest economy in the world. The country has made significant strides in its economic sector since its independence in 1971. The Bangladeshi garments industry is one of the largest and most comprehensive industries in the world. In recent years, the Ready-Made Garments (RMG) sector has emerged as the biggest earner of foreign currency. The RMG sector has experienced an exponential growth since the 1980s. The sector contributes significantly to the GDP. An overwhelming number of workers in this sector are women. This has affected the social status of many women coming from low-income families.

Bangladesh is Nepal’s second largest trading partner in South Asia, and trade between the two countries is governed by the Bilateral Trade Payment Treaty of 1976. The two sides agreed to enter into a preferential trading agreement providing special duty concessions to each other’s commodities, within the ambit of a regional free trade agreement. Nepal has already forwarded a list of 140 commodity groups to Bangladesh for duty free facility. Annual bilateral trade volume between Nepal and Bangladesh remains low due to tariff barrier and poor trade facilitation measures. During our Hon’ble PM Sheikh Hasina’s recent historic state visit to India, a joint communiqué was issued, three agreements on countering terrorism and drug and human trafficking, and two MoU were signed for promotion of trade, transit and connectivity, electricity supply and cultural exchange. India agreed to provide land transit facility to Nepal through Kakarvitta-Fulbari-Banglabandha route and the Rohalpur-Singhbadh broad-gauge railway line (between Bangladesh and India) with a railway line to Birgunj dry port. Bangladesh also allowed the use of both of her sea ports (Chittagong and Mongla) to India, Nepal and Bhutan.

If Nepal can utilize these trade promotion facilities offered by Bangladesh, her trade relations with Bangladesh and other countries will be enhanced to a large extent.

Negotiations are underway to sign the Agreement on the Avoidance of Double Taxation between the two countries with a view to further boosting trade relations. Both the countries also need to shorten, if they cannot remove at all, the sensitive/negative list of product. Both the countries are also in the final stages of negotiation for the finalization of the agreement on transport modalities. The prospect with this is that the present trade volume between both the countries will increase at least 3 times.

From the list of exportable items, it seems to me that the export basket of both the countries is narrow. In 2008-2009 FY, Nepal exported a total of 20 products to Bangladesh out of which wheat and lentils constitute the major portions. On the other hand, Bangladesh exported 119 items to Nepal out of which RMG took a 80% share. Both the countries need to increase their export basket in order to increase the trade volume. If there is cooperation among close neighbours, the electricity problem of this region can be solved. An understanding has been reached recently at the meetings of BIMSTEC to establish a regional grid for exchanging electricity among the member countries to promote cooperation in the field of energy.

Every year, Bangladesh has been providing 12 seats for Nepali students to pursue medical courses at the Government Medical Colleges and 10 seats at Engineering Universities on self-finance basis.

History and world experience show that politically viable system is the prime mover of development and progress. So, sustainable democratic system accommodating diversity and pluralism of the society is a must. The system must ensure democratic values and equality in society and democratic values. Development of the democratic countries in the world especially in our neighbouring India shows that they also faced problems and conflicts but maintained the diversity and pluralism of the society.

Economic emancipation is the main factor for progress of any country. For this, we have to work at the national, regional and global levels. Considering this for cooperation among the close neighbours, India, Bangladesh, Nepal, Bhutan and other SAARC countries is necessary. We need cooperation with SAARC observer members China, Japan, Korea, ASEAN countries, side by side cooperation from USA, UK, EU and OIC and NAM countries of the world to move ahead on the path of development and progress.

H.E. Dr. Bhowmik is

Ambassador of Bangladesh to Nepal