Bangladesh and Bhutan have signed a memorandum of understanding on transit, aiming to strengthen trade ties.
As part of the MoU, Bhutan can pay a fee and use land, water and aviation routes in Bangladesh to run its import and export business with a third country. Bangladesh, on the other hand, can run trade with China through Bhutan using the transit facility when Bhutan gets direct road connectivity with China in the future.
Bangladesh Commerce Minister Tipu Munshi and Bhutan’s Trade, Industries and Employment Minister Karma Dorji signed the initial deal in Thimphu on Wednesday.
Tipu Munshi hoped that the new agreement will pave the way for smooth trade and business between the two countries, the commerce ministry said in a statement.
After Bhutan dropped out of the Bangladesh, Bhutan, India, and Nepal Motor Vehicles Agreement, it proposed a bilateral transit agreement with Bangladesh. In September 2022, the countries held meetings and drafted an agreement and protocol.
The Bangladesh government then approved the transit deal at a cabinet meeting.
On Dec 6, 2020, Bangladesh signed a preferential trade agreement with Bhutan. Under the agreement, both countries were supposed to get tax-free trade facilities for some commodities.
In the 2008-09 fiscal year, the bilateral trade between the countries stood at $12.16 million, which rose to $57.9 million in the 2018-19 fiscal year.
Bangladesh mainly exports garments, food products, plastic goods, medicine, household products, and electronic products to Bhutan, while it imports fruits and vegetables, minerals, construction materials, boulders, pulp and chemicals from Bhutan.