Bilateral trade between Bangladesh and Bhutan has experienced significant growth, doubling to $22.1 million in the fiscal year 2022-2023 following the implementation of the preferential trade agreement (PTA) in 2022. The PTA with Bhutan is Bangladesh’s first PTA.  

The PTA, signed on 6 December 2020 and implemented on 1 July 2022, has opened up new opportunities for both countries. The agreement has allowed 100 Bangladeshi products to enjoy duty-free access to the Bhutanese market, while Bhutan has duty-free access for 50 products in Bangladesh. This arrangement expanded upon the previous trade relations, where Bangladesh had been providing duty-free market access to 18 Bhutanese products since 2010, and Bangladesh enjoyed similar benefits for 90 of its products in Bhutan. 

Economists and policy experts view this agreement as a crucial step for Bangladesh, as the country will undergo transition from a least developed country (LDC) to developing country in 2026. With the milestone achieved in bilateral trade with Bhutan, experts recommend that Bangladesh prioritize establishing similar PTAs and free trade agreements with neighboring countries to maintain its trade advantages.  

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Trade with Bhutan doubles after preferential trade agreement 

Photo: EIF on Flickr