logo logo

Bangladesh, India agree to conclude CEPA process

The Financial Express - 26 November 2023

Bangladesh, India agree to conclude CEPA process
By Mir Mostafizur Rahman

Bangladesh and India agree to wrap up negotiations on a much-vaunted comprehensive partnership forum by 2026, trying to give their close cooperation a further fillip.

The issue of striking the Comprehensive Economic Partnership Agreement (CEPA) came into focus at the foreign-office consultation between the two countries held last Friday in Delhi, apart from other major issues of mutual interest, including Bangladesh’s polls.

Bangladesh Foreign Secretary Masud Bin Momen, who led the Bangladesh delegation at the meet, said Sunday that the Indian side wanted to know about "our preparation, and how we are negotiating with multilateral and international institutions to address the post-graduation challenges as Bangladesh will be deprived of many preferential trade facilities after the graduation".

Then both sides observed that CEPA could be a mechanism to enhance Bangladesh’s ability to offset the post-graduation shocks and it was decided that the negotiations should be concluded before November 2026, he added.

The proposed CEPA goes beyond the traditional free-trade agreements and also addresses trade in services, investment, intellectual-property rights and e-commerce.

The proposed deal, which calls for withdrawal of duties, is expected to boost Bangladesh’s exports by 190.15 per cent and more if transaction costs were also reduced through improved connectivity, said a study by the Bangladesh Foreign Trade Institute and the Indian Centre for Regional Trade.

India’s exports to Bangladesh are expected to increase by 188 per cent.

The CEPA will increase Bangladesh’s GDP by 1.72 per cent and India’s by 0.03 per cent, the study says, adding that due to being an LDC, save about 25 items (mainly tobacco and liquor) all goods from Bangladesh enjoy duty-free access to India.

Upon graduation from the LDC category, Bangladesh will no longer be eligible to continue the high tariff line as it is now, therefore, in a way or another, Bangladesh will have to provide duty-free, quota-free market access to India once it graduates out of LDC under the existing South Asian Free Trade Area negotiations.

"It is in this context, the role of CEPA becomes crucial, at least from the Bangladesh perspective," the study comments.

However, the FS said the meeting stressed that apart from strengthening connectivity in different modes of transportation like rail, road and air, steps should be geared up to solidify connectivity of power grids and ICT.

India suggested concentrating on construction of the cross-border power- transmission lines. As such, construction would require nearly two years, he added.

The FS said that India assured of providing necessary assistance in power trade among Bangladesh, Bhutan and Nepal.

"Bangladesh is eager to import hydroelectricity from Nepal and Bhutan. And India has already given consent to use of its land for this purpose," he mentioned.

Responding to a question he said the discussion on the Indo-Pacific issue highlighted the regional connectivity.

In this regard, both the countries felt that the Big-B project undertaken by Japan centering the Matarbari Deep-sea Port will play a crucial role in promoting trade and investment in the region.

About the pending water-sharing issues he said that Bangladesh reiterated its request for taking due measures to sign the deal on the water sharing of the Teesta River.

The two countries also agreed to start technical discussions to extend the Ganges Water Sharing Treaty, which will expire in 2026.

Besides, the meeting reviewed the progress on the water sharing of the six other common rivers, he said.

He said when the issue of the elections came up, the Indian side made it clear that it is the internal issue of Bangladesh and it is their policy to respect the will of the people of Bangladesh, and its constitution in this regard.

"They have no concern about our election—they said that they have full confidence in our institutions and people."

But both the countries feel that efforts should be stepped up to prevent arms smuggling through borders so that these cannot be used to carry out sabotage the elections by any vested quarter, he added.

Bangladesh requested India to play more active role in Rohingya repatriation as a neighbour of both Myanmar and Bangladesh.

"We have also seen the insurgency groups have become more active which is not conducive to the repatriation."

Asked about his briefing to the foreign diplomats stationed in Delhi, he said that Bangladesh’s socioeconomic development was highlighted in the brief.

"I told them that the real achievement made by Bangladesh could not be realized by sitting in Delhi and many of them said that they are interested in opening Missions of their countries in Dhaka.

"I have briefed them about our upcoming elections and handed over them the guidelines of the EC for election observers."

 source: The Financial Express