US-Bangladesh FTA talks begin, Garment exports may see major boost
Bangladesh and the United States have initiated discussions on a potential Free Trade Agreement (FTA), a development that could significantly benefit the country's key export sectors, particularly the readymade garments (RMG) industry. If successful, the deal may pave the way for duty-free access to the US market, offering a major boost to Bangladesh's trade earnings.
According to sources, a Bangladeshi delegation met with representatives of the United States Trade Representative (USTR) last month to explore avenues for strengthening bilateral trade ties. Central to the discussions was the potential removal of additional tariffs introduced during the Trump administration. Bangladesh put forward the FTA proposal as a strategic approach to expand trade and investment between the two nations.
"Although Bangladesh has previously suggested an FTA to the United States, there was limited progress. This time, the response has been positive, and preparations are already underway," the Commerce Secretary confirmed. He added that a special committee has been formed to quickly draft the proposed agreement.
The United States remains Bangladesh’s largest single export destination, accounting for 17.09% of total exports and more than 18% of garment shipments. Data from the commerce ministry highlights that 26% of woven garments, 11.71% of knitwear, and 16.12% of home textiles exported from Bangladesh are destined for the US.
Industry stakeholders stress the importance of securing trade benefits similar to those enjoyed by regional competitors. Vietnam, for instance, currently pays only a 7% duty on apparel exports to the US, whereas Bangladeshi exporters face tariffs exceeding 15%. India is also pursuing an FTA with Washington, intensifying the urgency for Bangladesh to secure comparable terms.
Bangladesh exported $7.60 billion worth of goods to the United States in the last fiscal year. Between July and April of the current fiscal year, exports to the US reached $7.19 billion. On the other hand, imports from the United States totaled Tk28,144 crore last fiscal year, with Tk22,168 crore in imports recorded during the first nine months of this fiscal year.
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