WHAT JUST HAPPENED?
In a bid to woo Bangladesh, China has provided a huge trade boost to the country by announcing tariff exemption for 97 per cent of Bangladeshi products effective from July I.
With this proclamation, a total of 8,256 Bangladeshi products will come under the 97 % of products that would be exempted from tariff.
Currently, 3095 Bangladeshi products enjoy duty free access to Chinese market under Asia-Pacific Trade Agreement (APTA) was signed in 1975 also known as (the Bangkok Agreement) and renamed on 2 November 2005.
CHINA BANGLADESH TRADE
The bilateral trade between Bangladesh and China, which amounted to $18 billion in 2019
Unfortunately Bangladesh has a massive trade deficit with China of over 14 billion U.S dollars
CHINA WANTS TO REDUCE THE TRADE DEFICIT WITH BANGLADESH
That is why they gave Bangladesh a much larger access to their huge
During the Asian-African Conference which took place this week in Indonesia, Chinese president Xi Jinping announced that China will grant duty free market access for Least Developed Countries (LDC) 97 per cent of the tariff lines within a year.
This beneficial market access scheme will be applied only for imports from Least Developed Countries LDCs that have diplomatic relations with Republic of China.
ASIA PACIFIC TRADE AGREEMENT [APTAl
This is being done under Asia Pacific Trade Agreement (APTA)
The Asia-Pacific Trade Agreement (APTA), previously known as the Bangkok Agreement and renamed 2 November 2005
POINT TO NOTE
In the past India has given Bangladesh larger access to its market under APTA as well (Article from 2018)
Although APTA tariff concessions to Bangladesh isn’t a huge concern for India, we must be cautious of the huge debt Bangladesh has undertaken from Chinese firms
2019 BANGLADESH PM CHINA VISIT
Bangladeshi Prime Minister Sheikh Hasina’s official visit to China seemingly succeeded in bolstering ties between the countries.
During the trip, both sides inked a host of agreements, including two deals to provide loans to the Bangladeshi power sector, worth $1.7 billion (€1.52 billion).
Bangladesh and Republic of China turned their relationship into a strategic partnership in 2016, and, in recent years, Chinese investment in the South Asian country has risen swiftly.
As part of Chinese President Xi Jinping’s Belt and Road Initiative (BRI), Beijing and Dhaka signed deals worth $21.5 billion covering a raft of power and infrastructure projects.To date, pledged BRI-related investment in Bangladesh stands at around $38 billion, estimates Standard Chartered, a British bank.
China grants Bangladesh 97% less Tariff Package China grants Bangladesh 97% less Tariff Package