Presentation on

International Trade of
Bangladesh

International Trade

International trade is the

exchange of goods and services
between countries. It gives rise
to world economy in which
prices, supply,demand- all of
these affect each other and are
affected by global events.

Features of International Trade

Includes Two or more sovereign countries
Exposes goods and services to foreign countries
Includes Buying and Selling- Import & Export
respectively
Almost every kinds of products are found in
international market
Increases efficiency through Specialization
Encourages Foreign Direct Investment
Leads growth of Gross Domestic Product

IMPORT
Imports are the goods and services that
are bought by residents, governments or
businessesof a country, but made outside
of the country. They can be shipped, sent
by email, or even hand-carried in personal
luggage on a plane.
Most countries would prefer to import less, and
export more
Countries that rely on imports for important
commodities
Countries with higher import levels then need to
also increase their currency reserves to pay for the

IMPORT TREND OF BANGLADESH AT A

GLANCE
Imports in Bangladesh decreased to 238.04 BDT Billion in
September from 248.37 BDT Billion in August of 2015.
Imports in Bangladesh averaged 58.41 BDT Billion from
1976 until 2015, reaching an all time high of 284.13 BDT
Billion in March of 2014 and a record low of 0.57 BDT
Billion in November of 1976

Source: Tradeeconomics.com

INTERNATIONAL TRADE HISTORY OF

BANGLADESH
Since 1971 Bangladesh has experienced a
dramatic growth.
1971-1990 : Import was doubled compared to
Export
From 1991, Export started to grow
Trade balance started improving but still
negative
At present, 65th largest Export Economy
Still suffers in the area of foreign trade in
South Asian region
Difficulties arose by opposition from the
bureaucracy, public sector unions, and other

INTERNATIONAL TRADE TREND OF

BANGLADESH

Year
2007
2008
2008
2009
2009
2010
2010
2011
2011
2012

Total Export
(in billion $)

Total Import
(in billion $)

$14.11

$25.21

$15.56

$22.00

$16.70

$24

$22.93

$32

$24.30

$35.92

Deficit
(in billion
$)
$11.10
$6.44
$7.30
$9.07
$11.62

Source: Tradeeconomics.com

INTERNATIONAL TRADE TREND OF

BANGLADESH
Import-Export Comparison(2007-2012)
$40.00
$35.92
$35.00

$32.00

$30.00
$25.21
$25.00

$22.00

$24.00
$22.93

$20.00
$15.00
$14.11
$10.00

$15.56

$24.30

Total
Import(in
billion)
Total
Export(in
billion)

$16.70

Source: Tradeeconomics.com

COMMODITY WISE IMPORT-BANGLADESH

(Million US$)
2013-2014
Major Commodities

2012-2013

Amount
USD(Milli
% of
on US$)
Total
5423.2
23%
3957.5
17%

Amount
USD(Milli % of
on US$) Total
4735.1
26%
2567.4 14%

Cotton,(all types)

Mineral fuel, mineral oils

Nuclear reactors,Boilers,
mechanical appliances
Iron and steel

3079.9

1868.5

Electrical machinery and

equipment
Animal or vegetable fats and
oils
Cereals

1652.2

7%

793.7

4%

Plastics and articles thereof

1519.3

7%

1160.9

6%

1030.5

10

Ships, boats and floating

structures
Fertilizer

1026.2

4%

Total

23254.5

100%

4
5
6

2500.9
13%

1915.7

8%

14%
1652.8

9%

1309.4
8%

1781.5

7%
1418

8%

8%

1009.3
4%

6%
1188.3

6%

18335.8 100%

Source: Bangladesh bank

COMMODITY WISE IMPORT-BANGLADESH

12000
4735.1
10000

8000
2567.4
6000

2500.9

5423.2
4000

1652.8

3957.5

1309.4

1418
793.7

3079.9
2000

1915.7

1868.5

1781.5

1652.2

1160.9
1009.3

1188.3

1030.5

1026.2

1519.3

20122013

Source: Bangladesh bank

COST TO IMPORT (US$ per container)

2010-2014
Cost of import
comparison( US$ per
container)
2010

$1,305.00

2011

$1370.00

2012

$1430.00

2013

$1437.00

2014

$1515.00

cost of import comparison

$1,550.00
$1,500.00

$1,515.00

$1,450.00

$1,430.00

$1,437.00

$1,400.00
$1,350.00

$1,370.00

$1,300.00

$1,305.00

$1,250.00
2010

2011

2012

2013

2014

Source: WORLDBANK.ORG

IMPORTS OF GOODS AND SERVICES(% of GDP)

2010-2014
Bangladesh Imports 30
of goods and services
(% of GDP)
25
2010

21.78

2011

27.5

2012

27.95

2013

26.76

2014

25.23

27.5

27.95

26.76

25.23

21.78

20
15
10
5
0

2010

2011

2012

2013

2014

Source: WORLDBANK.ORG

IMPORTS OF BANGLADESH (TOP 10 COUNTRIES)

Sl no

Major countries

1
2
3
4
5
6
7
8
9
10

China
India
Singapore
Malaysia
Japan
Korea
Indonesia
Brazil
Taiwan
Kuwait
Total=

In million US $
2013-2014
7540.8
6035.5
2289.5
2041.7
1283.8
1198.9
1104.2
998.0
919.3
914.6
24326.3

% of Total
31%
25%
9%
8%
5%
5%
5%
4%
4%
4%
100%
Source: Bangladesh bank

IMPORTS OF BANGLADESH (TOP 10 COUNTRIES)

Others; 21%

China; 31%

Japan; 5%
Malaysia; 8%
Singapore; 9%

*Other countries
includes Malaysia,
Japan,
Korea,
Indonesia, Brazil,
Taiwan and Kuwait.

India; 25%

Source: Bangladesh bank

IMPORTS ITEMS FROM CHINA

SL
no.

Top 5 Import items from China

Commodity group

(Million US$)
2013-14 % of Total

20122013

% of
Total

Cotton (all types), cotton yarn

/ thread and cotton fabrics

1618.8

36%

1409.6

36%

Nuclear reactor, boilers,

machinery

1161.4

25%

941.1

24%

Electrical machinery and

equipment

986.2

22%

753.5

19%

Man-made staple fibres

401.6

9%

417

11%

Knitted or crocheted fabrics

389.4

9%

377.1

10%

4557.4

100%

Total=

3898.3 100%
Source: Bangladesh bank

IMPORTS ITEMS FROM CHINA

1700
1618.8
1500
1409.6
1300

1100

900

1161.4
941.1

986.2
753.5

700

500
417
401.6

300

2012-2013

377.1
389.4

2013-2014

Source: Bangladesh bank

IMPORTS ITEMS FROM INDIA

SL
no.

Top 5 Import items from India

(Million US$)

Commodity group

2013-14

Cotton (all types), cotton yarn

1421.4

Cereals
Vehicles other than railway or
tramway rolling stock
prepared animal fodder
Nuclear reactor

1085.9

3
4
5

Total=

% of 2012- % of
Total 2013 Total
1260.
40%
47%
1
30%
487 18%

497.7

14%

293.1
278.7

8%
8%

3576.8

300.4 11%

244.9 9%
377.1 14%
2669.
100%
100%
5

Source: Bangladesh bank

IMPORTS ITEMS FROM INDIA

1600
1421.4
1400
1200

1260.1
1085.9

1000
800
600

487

497.7

400

300.4

200
0

2013-14

2012-2013

293.1
244.9

377.1
278.7

Apart from
these 5
items,
Bangladesh
imported
Iron and
steel, Edible
vegetables,
Organic
chemicals,
Mineral
fuels,
Plastics and
so on.

Source: Bangladesh bank

IMPORTS CLASSIFIED BY
BLOC/GROUP/COMMUNITY

Other Asian Countries topped the list, selling goods

worth Taka 98212.5 crore of the total import payments
during the period under review as compared to Taka
87953.1 crore in the preceding year.

The second highest seller were the member countries of

Organization of Islamic Conference (OIC) which
accounted for an

The third highest seller were the member countries of

ASEAN

The fourth highest seller were the member countries of

Asian Clearing Union (ACU)

SAARC, EU, OPEC, NAFTA member countries and Other

European countries followed in descending order of

IMPORTS CLASSIFIED BY
BLOC/GROUP/COMMUNITY

Source: Bangladesh bank

EPZ
Export processing zone (EPZ) is a specific type of FTZ,
set up generally in developing countries by their
governments to promote industrial and commercial exports
The primary objective of an EPZ is to provide special areas
where potential investors would find a congenial
investment climate free from cumbersome procedures.
BEPZA- The BEPZA is the official organ of the Bangladesh
government to promote, attract and facilitate foreign
investment in the EPZs.

IMPORTS OF EPZ
In order to
achieve rapid
economic growth
of the country by
increasing the
inflow of foreign
investment,
particularly through
industrialization,
special steps have
been taken since
1980 by setting up
Export Processing
Zone (EPZ) in the
country. There are 8
EPZ

Source: Bangladesh bank

IMPORTS OF EPZ
Year
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14

Amount in
Million USD
261
402
493
496
665
685
627
727
886
952
1062
1144
1294
1302
1414
2140
2114
2505
2975

Import of EPZ
3500
3000
2500
2000
1500
1000
500
0

ANNUAL GROWTH RATE OF

IMPORT
Period
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14

Amount(Millio
n US$)
8540
9658
10903
13147
14746
17157
21629
22507
23738
33657
35516
34084
40732

Annual Growth
Rate
n/a
13%
13%
21%
12%
16%
26%
4%
5%
42%
6%
-4%
20%

Average Annual
Growth rate( Over
14 years)

126%

Average
Annual
Growth Rate=
((Current
importPrevious
import/Previ
ous
import)^(1/
(Periods - 1))
-1

ANNUAL GROWTH RATE OF

IMPORT
Annual Growth Rate
50%

42%
40%

30%

26%
21%

20%

20%

13%

16%
13%

12%

10%

4%

5%

6%

0%
-4%
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2008-09 2009-10 2010-11 2011-12 2012-13
2013-14

-10%

BALANCE OF TRADE

Thetrade balance, also known as theBalance of

trade is the calculation of a country's exports
minus its imports.
The trade balance is a component of a country's
current account, which in turn is a component of
thebalance of payments (BOP).
When a country imports more than it exports, the
resulting negative number is called atrade deficit.
When the opposite is true, a country has atrade
surplus.

BALANCE OF TRADE
$0.00
($2.00)
($4.00)
($6.00)
($8.00)
($10.00)
($12.00) ($11.10)
($14.00)

($6.44)

($7.30)
($9.07)
($11.62)

IMPORT POLICY OF BANGLADESH

Bangladesh import policy places rules,
regulations and controls on the import of
products.
Some product restrictions are applied by
government organizations, which include:
Prohibited list
Restricted list
Freely importable items
All imports must be supported by a letter of
credit, except for the import of capital
machinery and raw materials for industrial
use.
Certification requirements for all food
products.

IMPORT POLICY OF BANGLADESH

Allowing registered commercial importers to

import without the need of an import license
Importers must lodge a 10 to 100 per cent cash
margin against covering letters of credit
Import transactions are governed by regulations
specified on the Import Policy Order (IPO) issued
by the Chief Controller of Imports and Exports,
Ministry of Commerce.
Foreign exchange is controlled by the
Bangladeshi Bank in accordance with Foreign
Exchange Control policy allocation is
administered through authorized financial
institutions
There is a short list of prohibited goods including,
most second-hand goods.
Penalties for the smuggling of illegal narcotics
are severe.
Some engineering products must comply with
established technical standards and require an
inspection certificate issued by a recognized

IMPORT POLICY OF BANGLADESH

The valuation method for import duty and tax is CIF
(Cost, Insurance and Freight)
Import is also subject to VAT, Supplementary Duty,
Regulatory Duty, Advance Trade VAT, and Advance
Income Tax
Products having net cost below 1000BDT is not subject
to custom duty
Free Import :
-200 cigarettes or 50 cigars or 225g of tobacco;
-Two bottles of alcoholic beverages or 1 bottle if not
travelling for touristic purposes (applicable to non
Muslim travelers)
- 250ml of perfume;
-Gifts up to the value of BDT500
-Residents can import an unlimited amount of foreign
money. Non residents can import up to 1000 USD

IMPORT POLICY OF BANGLADESH

Customs duty
Duty ranges from 0- 25%
advance income tax: five per cent
value-added tax: five to 15 per cent
supplementary duty: 10 to 15 per cent, also
applicable on luxury items.
Customs duties are levied on all imports except:
generators
IT equipment
raw cotton
textile machinery
certain types of machinery used in irrigation and
agriculture
animal feed used by the poultry industry
certain drugs and medical equipment.

IMPORT POLICY OF BANGLADESH

KEY FINDINGS
Bangladesh is largely depending upon
imports
Should be alert to minimize the trade deficit
Should broaden the economic activity, like
diversifying exports
Overall import policy is not so protectionist
Should be strict to import policies in order to
protect the domestic industries
The government should continue to support
the growth of domestic demand and privatesector led investment