Summary:

Trade between Bangladesh and the South Asian Association for Regional Cooperation (SAARC) members is decreasing, both in terms of imports and exports. A Bangladesh Bank report released on 2nd June 2024 states that the SAARC members’ total export revenue dropped by nearly 1%, from USD 1.93 billion in FY22 to USD 1.91 billion in FY23. Exports to India and Sri Lanka increase, whereas those to Nepal decline. Imports from India decreased by $4.45 billion. 

Context:

The total export revenue from SAARC nations dropped from $1.93 billion in FY22 to $1.91 billion in FY23, representing an almost 1% decline, according to a Bangladesh Bank report released on the 2nd  June, 2024. According to central bank data, Europe and the US were Bangladesh’s top export destinations in FY23, making up 3.44% of the country’s total exports. Bangladesh’s total exports increased to $55.55 billion in FY23, a 6.28% annual growth. Exports to the SAARC countries did not fare well, despite this encouraging development. SAARC nations did not fare well when it came to imports, making up only 15% of Bangladesh’s total import payment. These nations’ total import payments fell by 31% during the fiscal year, from $14.93 billion in FY22 to $10.34 billion in FY23. Overall imports decreased by 15.76% as a result of the central bank’s numerous limitations designed to address the dollar shortage. This indicates that the SAARC countries’ imports are declining more quickly than the overall performance. The executive director of the Centre for Policy Dialogue, Fahmida Khatun, stated: “Our overall imports have already decreased somewhat due to the dollar crisis.” We do not, however, have a significant comparative or competitive advantage in trade with SAARC nations. In other words, there are less chances for import and export because these nations produce similar goods. Further reducing demand for our products is, Bangladesh’s dearth of specialized products that are distinctive and in demand in these areas.” Within SAARC, export trends are mixed, while exports to Nepal and Pakistan decreased, they increased to India and Sri Lanka. The largest trading partner in SAARC, India, saw a sharp decline in import payments, falling from $13.94 billion in FY22 to $9.49 billion in FY23, or around 32%.  Overall, import payments to Bhutan showed an increasing trend and the Maldives had a minor increase, while import payments to Pakistan, Sri Lanka, and Afghanistan also decreased. Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka are among the SAARC nations.

Picture and Article Sources: Bangladesh Textile Journal & The Business Standard