1.7. Economic Cooperation and Trade

♤ Bilateral trade between India and Bangladesh has grown steadily over the last decade. In the last five years, total trade between the two countries has grown by more than 17%. India’s exports to Bangladesh in the period July 2016 – March 2017 stood at US$ 4489.30 million and imports from Bangladesh during FY 2016-17 stood at US$ 672.40 million.

♤ There are estimates that the trade potential is at least four times the present level.

♤ Lines of Credit: In recent Year India has extended three lines of credit worth US$ 8 billion to Bangladesh for a range of projects, including railway infrastructure, supply of Broad

Gauge microprocessor-based locomotives and passenger coaches, procurement of buses, and dredging projects. This is the largest quantum of credit India has extended to any other country by far and comes at a highly concessional rate of interest.

♤ Despite duty-free access, Bangladeshi exporters face high non-tariff barriers in the form of bureaucratic and customs bottlenecks, delays due to manual clearance, visa problems, lack of banking services and warehouse facilities at the border. The cost of cross-border trade is quite high.

♤ ‘Border Haats’, or markets across the India-Bangladesh border (currently four such haats are functional), were a successful solution to increase legal business on the borders. Recently, Bangladesh and India have agreed to set up six more haats along their borders.