For fast economic growth
After signing the revised trade agreement, India and Bangladesh hope to overcome the difficulties in the field of border trade.

Purnendu Bijoy

The North Eastern Region (NER) of India is surrounded by four neighbouring countries viz. Bangladesh, Bhutan, China and Myanmar, with whom the seven sisters shares 98 percent of the border. The total length of land border between NER and neighbouring countries is 5249 km., of this, the length of border between NER-Bangiadesh is 1956 km, NER-Bhutan is 650 km, NER-China is 1000 km and NER-Myasimar is 1643 km.

Therefore for the people of North-East, border trade and trading with the bordering areas are two very natural and easier economic proposition. On the other hand apast from three neighbouring countries viz China, Myanmar and Bhutan, Bangladesh is closer to NER in terms of geo-cultural relations. The region has age-old, socio-economic ties with Bangladesh from time immemorial.

The land border between Bangladesh and North-East is more accessible and cost effective than the border with other neighbouring coimtnes. Keeping these facts in mind India and Bangladesh have signed an agreement to boost trade and economic ties between the two countries. This agreement was signed on 2116 March, 2006 while Bangladesh Prime Minister Begum Khaleda Zia was on a three-day visit to India with high level delegates both from government departments and business organisations.

According to the revised trade agreement signed by India and Bangladesh on expiry of the Trade Agreement of 1981, both the countries have agreed to use their waterways, roadways and railways for passage of goods between places in one country through the territory of the other. The revised trade agreement also agreed to recognise that expansion of trade is important for development of the two countries and also took into account the asymmetries that existed between them. The agreement also called for co-operation between the two governments to prevent infringement and circumvention of rules and regulations of either country in matters related to   foreign exchange and foreign trade.

After signing the revised trade agreement both the sides hope to overcome the difficulties in the field of border trade between India and Bangladesh which will definitely be more beneficial for North-Eastern Region-Bangladesh trade.

The trade between North-East  and Bangladesh can be divided into two catagories. One is formal or official and another is informal or unofficial. According to the data prepared joinlly by Tripura   Chamber of Commerce and Industry and Chittagong Chamber of Commerce and Industry, during 2001-2002 formal trade between two countries was 194.9 crore (5.9 crore from Bangladesh to North-East    and from North-East to Bangladesh 189 crore).

The formal exported goods by NER to Bangladesh are mainly    coal, non-basmati rice, lime stones, ginger etc. while imported goods  are mainly dried fish, hilsa fish,  fresh fish.

On the other hand the volume of informal or unofficial trade between North-East and Bangladesh is much higher than formal or official trade. The principal commodities exported (smuggled) to Bangladesh through North-East include spices, textiles and readymade garments, sugar, drugs etc. while imported goods are mainly electronic items, jute and plastic products etc.

However, the informal trade or smuggling indicate that there is hidden demand for these items. Since the regions unofficial trade volume is 4-6 times higher than official trade, this indicates the minimum potential to which the legal export can be raised. For example, demand for fish (fresh and dry) in North-East is estimated at 90,000 tonnes. Even if Bangladesh would supply 50 per cent of this, trade would increase between 50-100 million US dollars which is 5 to 10 times more than the current volume of total trade. Likewise, demand for horticulture products like ginger, garlic, oranges, citrus fruits etc. is there in Bangladesh.

If North-East grows more and more horticulture products and exports it to Bangladesh it will definitely increase the current volume of total exports from this region.

But what then are the obstacles? The obstacles are mainly low or absence of proper infrastructure and lack of co-ordination as well as co-operation. Though India played a decisive role in the emergence of independent Bangladesh but the friendship between two countries did not last long, and infrastructure facilities in terms of border trade is very low.

Another obstacle is lack of co-ordination and co-operation. To overcome these obstacles with the help of both the governments, the Federation of Bangladesh Chamber of Commerce and Industry and Federation of Chambers of Conmercc and Industry of India signed a memorandum of understanding (MoU) to promote Bangladesh’s trade and investment opportunities and encourage Indian ccirapames to choose Bangladesh as their preferred investment destination.

The two business bodies decided to set up a joint task force to work out time-bound and target bound activities to spread awareness of bilateral trade opportunities. These Government as well as business body level agreements will definitely boost the border trade between two neighbouring countries. As a result it will increase the volume of border trade of NER and give a boost to the economy of the region.

|  Headlines  |  Editorial   | Cover story  |
|  Travel Column   |   News Briefs  |
| OT Main Page | Nena  Home Page  |