Trade agreement with US to boost export, FDI: Commerce adviser

Commerce Adviser Sk Bashir Uddin said that the signing of the Agreement on Reciprocal Trade (ART) with the US on Monday will boost exports significantly and attract more foreign direct investment (FDI) to Bangladesh.
“Around 85% to 86% of Bangladeshi products exported to the US will enjoy zero-duty benefits following the signing of the ART between the two countries. And the remaining 14%-15% will face a supplementary duty of 19%,” the adviser said at a press conference at the ministry’s conference room in the capital.
“Around 86% of Bangladesh’s total exports consist of readymade garments (RMG). If Bangladeshi garments are manufactured using US cotton, those products will receive zero supplementary duty access to the US market,” he explained.
The adviser said the US consumes approximately $340 billion worth of apparel annually. Bangladesh is the only country that has secured zero-duty benefits in this way.
On 2 April 2025, US President Donald Trump announced the imposition of higher tariffs on more than 100 countries. Bangladesh initially faced an additional 37% tariff, which was later reduced to 20% following negotiations and took effect on 1 August that year. 
Bashir said, “The government made dedicated efforts to ensure continued market access. In the first phase, we succeeded in reducing the additional tariff rate from 37% to 20%. Finally, the tariff has been reduced from 20% to 19%.”
“Bangladesh worked on several structural reforms and import liberalisation measures to reduce the trade deficit, which exceeds $6 billion,” he added. 
Bashir noted that Bangladesh is one of the world’s largest cotton importers, as only about 2% of the cotton required for garment production is produced domestically, while the remaining 98% must be imported. The US cotton is very suitable for Bangladesh and will help reduce the trade deficit.

He also mentioned plans to reduce the trade deficit by increasing imports from the US, including agricultural products, energy products, and traditional metal scrap.
The adviser said that in addition to garments, several other products—such as pharmaceuticals, boards, plywood, and furniture components—will also enjoy zero-duty access.
He said Bangladesh already imports many of the agricultural products included in the agreement.
Referring to previous claims of food self-sufficiency, the adviser said, “The idea that Bangladesh is food self-sufficient has proven to be incorrect, as we still import wheat, maize, oilseeds, and various agricultural products worth $15 billion.”
FDI will boost
The adviser added that exporters from other countries who face tariffs may now choose to invest in Bangladesh. “If we can import cotton, produce yarn, and export garments, foreign investment will increase. Not only the garment sector, but also the textile spinning and weaving sectors will benefit significantly through a two-stage transformation process,” he said.
At the press conference, Commerce Secretary Mahbubur Rahman said that alongside the ART, the US has granted a tariff facility titled “Potential Tariff Adjustment for Partner Countries,” effective from the date the agreement comes into force. Under this facility, duty-free benefits have been extended to more than 2,500 items.
“Pharmaceuticals rank at the top of the list. All HS codes and raw materials related to pharmaceuticals have been granted duty-free benefits. Other products include plastic goods, aircraft components, and plywood boards. The facility applies to countries that have entered into agreements with the US,” he added.

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