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Published : 29 Jul 2025, 02:49 AM
A high-level Bangladeshi delegation has left for Washington to negotiate with the US administration over the additional tariffs imposed on its exports under President Donald Trump’s second term.
Ahead of Tuesday’s talks, Dhaka has taken a series of steps aimed at improving bilateral trade ties.
Most recently, the interim government approved the purchase of 25 aircraft from US aerospace giant Boeing.
Earlier, Bangladesh lifted tariffs on more than 600 American products and pledged to boost imports of US oil, wheat and cotton.
Yet doubts remain over how much these gestures will influence the outcome of this week’s negotiations.
Analysts say the bigger question is not just whether the US will ease duties on Bangladesh, but how the final tariff regime will compare with those imposed on its competitors in the American market.
“To understand this, we first need to see what tariff rates are being applied to India, Pakistan, Cambodia, Indonesia and China,” said Zahid Hussain, former lead economist of the World Bank’s Dhaka office.
The delegation departed Dhaka on an Emirates Airlines flight at 7:30pm on Monday.
It includes Commerce Advisor Sheikh Bashiruddin, National Security Advisor Khalilur Rahman, Commerce Secretary Mahbubur Rahman, and Additional Secretary Nazneen Khawshar Chowdhury.
They are scheduled to sit with officials of the Trump administration on Tuesday and Wednesday.
This is not the first round of talks between the two sides.
The last meeting took place on Jul 9-10 in Washington DC, also attended by the commerce advisor.
That meeting produced no clear outcome.
Trump, after beginning his second term, announced on Apr 2 sweeping tariff hikes on over 100 countries.
Bangladesh was hit with a proposed 37 percent duty.
Amid growing concern, Chief Advisor Muhammad Yunus wrote to Trump urging him to reconsider the tariffs.
The letter called for a three-month suspension of the measure to allow time for talks. Trump agreed.
The pause was intended specifically for negotiations.
In response, Bangladesh announced duty exemptions on 626 US products in its national budget.
Despite these efforts, the outcome fell short.
Rather than the proposed 37 percent, Bangladesh now faces a 35 percent tariff -- set to come into effect from Aug 1.
COMPETITORS TARIFFS HOLD THE KEY
Economist Zahid believes the broader conversation about US trade policy could provide some relief to Bangladesh’s competitors.
“The US has raised four issues, one of which is tariffs. But both the government and businesses here are only talking about tariffs,” he said.
“The other three -- labour, human rights and intellectual property -- are being overlooked. The US expects progress in these areas too.
“Bangladesh may be hit by tariffs, but others like China could face even harsher measures. If some countries are hit harder, Bangladesh might benefit by gaining ground in those export segments,” he added.
Still, Zahid advised caution. “It’s too early to say Bangladesh is losing its market. We can’t draw conclusions without seeing what rates others face. But a global export shock does seem likely.”
The US remains Bangladesh’s largest single market, importing nearly $8 billion in garments annually.
The apparel sector accounts for 83 percent of Bangladesh’s total export earnings.
At HKC Apparels, one of the country’s leading manufacturers, 90 percent of annual output is shipped to the US.
“We or our buyers can’t do anything about it,” said managing director Rakibul Alam Chowdhury, a former director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
“It all depends on what the Trump administration decides. Whether we can continue doing business will be shaped by their decision.”
“Our competitive markets are India, Cambodia, Pakistan and Indonesia,” he added. “If the US brings our tariff level in line with theirs, we have nothing to worry about. It’s entirely up to them.”
He cautioned against making assumptions. “Until a decision is made, it’s wrong to jump to conclusions. We’re waiting restlessly. So are the buyers.”
CHINA’S TARIFFS
Like Bangladesh, many other developing nations have also come under higher tariffs from Washington, and are actively lobbying to ease the pressure.
In a significant development, the US has signalled a temporary pause in its tariff war with China, delaying new duties by three months.
Reuters reports that a high-level meeting between the US and China will take place at the Swedish Prime Minister’s Office in Stockholm on Monday
While Bangladesh’s new tariff regime is expected to take effect on Aug 1, China's will now be delayed from Aug 12, possibly until November.
A bilateral meeting between Trump and Xi Jinping is also scheduled for October, where a broader agreement on tit-for-tat tariffs may be reached.
HOW RIVALS ARE FARING
According to updated figures from the Office of Textiles and Apparel (OTEXA) under the US Department of Commerce, China remains the top apparel exporter to the US.
Despite the ongoing trade war, China shipped $4.89 billion worth of garments in the first five months of this year, marking a 10 percent year-on-year drop.
Bangladesh, holding the third spot, exported $3.53 billion worth of garments to the US during the January–May period -- a 21.6 percent increase from the same period last year.
Among other competitors, Indonesia’s exports to the US rose by 13.55 percent, India’s by 16.96 percent, and Pakistan’s by 21.58 percent during the same period.
