Dhaka, Sep 16 (UNI) Bangladesh today signed a deal with India for exporting eight million pieces of readymade garments (RMG) to New Delhi with zero-tariff access facility.
The memorandum of understanding (MoU) was signed between the Commerce Ministry and the Indian High Commission in Dhaka, under the purview of the South Asian Free Trade Area (SAFTA) deal among the SAARC member-countries.
As per terms of the MoU, Bangladeshi RMG manufacturers will be allowed to export the volume of apparels in one calendar year ''duty-free and without any conditionality of souring of fabric or port restrictions''.
Bangladesh Commerce Ministry's Joint Secretary Abdul Wahab Mian and the Indian Deputy High Commissioner Mukta D Tomar signed the trade deal on behalf of their respective governments.
Officials said the first consignment of RMG exports to India would be sent in January 2008.
According to Bangladesh business circles, the export of eight million RMG pieces to India, which are worth 40 million dollars, is, however, very insignificant comapred to Bangladesh's annual global RMG exports that fetch 9.2 billion dollars.
Bangladesh Commerce Secretary Feroz Ahmed said the signing of MoU added a new dimension to the trade relations of the two neighbouring countries.
Mr Ahmed said India is the second-largest trade partner with a huge trade imbalance in favour of India. ''Our export to India is very insignificant. India's annual exports to Bangladesh are to the tune of two billion dollars, while Bangladesh exports to India are about 300 million dollars''.
He added that Indian goods are cheaper and that is why Bangladeshi importers prefer the Indian products.
''We have made our products competitive to increase our export volume,'' he said adding that they have diversified the products as well.
RMG shares 75 per cent of the country's total exports, and referring to this as a problem, Mr Ahmed said that if RMG faced hitches anytime, it might lead to a great disaster for the whole export business.
The Indian High Commissioner said the MoU would play a significant role in reducing the trade gap between the two countries. The trade ties between the two countries would be expanded in future as both the countries are working on the issue.
The envoy said if Bangladesh wants to increase export to India, it has to improve its product quality and standard.
The High Commissioner added that an agreement would be signed soon between the Bureau of Indian Standard (BIS) and Bangladesh Standard and Testing Institute (BSTI) as part of the trade-expansion move.
''Bangladesh can take the advantage in exporting its goods to eastern Indian States through improving road and other infrastructure,'' the Indian envoy said.