Dhaka Eyes Tariff Relief in Crucial US Trade Talks

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Bangladesh has entered a crucial phase of negotiations with the United States in a last-ditch effort to reduce the newly imposed 35% reciprocal tariff on its exports.

The high-stakes trade discussions began at 10:30pm Bangladesh time on Monday and are expected to continue over three consecutive days. Monday’s session was scheduled to run until 3am, with another meeting planned for Tuesday from 10:30pm to 1:30am.

Ahead of the talks, Commerce Secretary Mahbubur Rahman confirmed that a key meeting with the United States Trade Representative (USTR) is set for 31 July. He also indicated that discussions could extend into 1 August—the date when the tariff is due to take effect.

Bangladesh's delegation includes Commerce Adviser Sk Bashir Uddin, National Security Adviser Khalilur Rahman, and Commerce Secretary Mahbubur Rahman.

At a government meeting in Dhaka on Monday, Finance Adviser Salehuddin Ahmed revealed that Bangladesh would offer a "package proposal" during the negotiations. The package includes potential purchases from the US such as Boeing aircraft, wheat, soybeans, and other commodities.

When asked about the possibility of defence-related purchases, the finance adviser declined to give details, saying further information would be shared after the commerce adviser returns.

Energy Adviser Muhammad Fouzul Kabir Khan also confirmed discussions with the US on increasing imports of liquefied natural gas (LNG). While there is no government-to-government LNG deal with the US, American companies like Accelerate Energy are among 23 firms currently enlisted to supply Bangladesh through the spot market. If US firms offer competitive prices, Bangladesh intends to buy more LNG from them.

According to data from the Export Promotion Bureau and Bangladesh Bank, the US is Bangladesh’s largest market for ready-made garments, with exports worth $8 billion. Imports from the US currently stand at around $2 billion.

To reduce this trade imbalance and gain tariff concessions, Bangladesh plans to significantly increase its imports from the US. The government is considering buying 25 Boeing aircraft and 700,000 tonnes of wheat annually. The private sector is also expected to boost imports of cotton, soybeans, and pulses.

A business delegation departed Dhaka for the US on Monday to explore increased imports and sign memoranda of understanding. The commerce secretary stated that Bangladesh intends to inform the USTR of its plan to raise public sector imports by $1.5 billion and private sector imports by $1.5 to $2 billion within the next 12 to 18 months.