Bangladesh's economic development is dependent on export earnings, remittances and domestic investments in key sectors by national and international investors. Our over-dependence on North American and European markets for exports is too risky because we can face new barriers from these countries on different pretexts. So, we must focus on diversifying our exports to other countries. We must also diversify exportable products, thus reducing over-dependence on readymade garments (RMG).

Apparel products account for 95.6% of the overall value of Bangladesh’s global shipments. Animal or vegetable fats, oils and waxes represent the fastest grower among the top 10 export categories, year-on-year up by 37.2% in 2020. The USA accounts for 20% of our exports. Germany, the UK, Spain and France account for 35% of our exports. Total exports of Bangladeshi products rose to $56 billion in 2023. China accounts for 21% of our imports, closely followed by India with 13%. Singapore, Hong Kong, Malaysia and Indonesia account for 20-25%.

Our total import is $88 billion. Therefore, we have a serious trade deficit. Remittances help in reducing this deficit to some extent, but we must increase exports further. In addition to RMG, we also export footwear, fabric, textiles, jute yarn, shrimp and fish. Our imports are refined petroleum, cotton fabric, fertilisers, food items such as onions, rice, oil and other essentials, and several consumer products, including electronics.

With the Trump administration, there is a serious possibility of some kinds of tariffs on our exports. Moreover, Indian politics about Bangladesh's economy and political situation can play havoc with our exports. India is making serious efforts to get the Trump administration to their side with its thinking about Bangladesh. As the USA is concerned about China, India does not hesitate to talk about Bangladesh's friendship with China. India is lobbying extremely hard with the new US Administration to sanction Bangladesh on human rights violations by peddling fake news about violence against Hindus. Indian media has partnered with the extreme elements of the Indian government to spread fake news about minority rights in Bangladesh. This strategy has two major aims. The first one is, to create economic hardships so that political instability leads to the failure of the interim government which may pave the way for a quick election undermining the reform agenda and Awami League’s rehabilitation.

And the second is that India wants to triple their RMG exports which can come at the expense of Bangladesh losing access to Western markets. We should seriously deal with such threats because if Bangladesh is in economic and political turmoil, India will have the upper hand in dealing with Bangladesh. Any economic hardships will mean millions of poor people going hungry, thus creating social problems. Recently, the US Ambassador in Delhi made a comment about US and Indian interests to see the election in Bangladesh. This is an unfortunate digression by the US Ambassador. This is a warning that Bangladesh must take seriously and chart its own strategy to build a strong relationship with the USA. Indian foreign policy has led to anti-India sentiment in Bangladesh, Sri Lanka, the Maldives and Nepal. We can only hope the US Embassy in Dhaka will encourage the new Trump administration to chart an independent strategy with Bangladesh. And our government, political parties and civil society must unite to encourage the USA to that end.

We must seriously deal with external threats to our economy. China has recently opened its market to Bangladeshi products. We must pursue this opportunity vigorously as it is the second-largest economy and is expected to become the largest one. We must expand our exports to ASEAN countries, Australia, South Korea and Japan as we do not see any political threats from these countries. And we must explore and expand our exports to the Middle Eastern countries, many of which are rich and can absorb more products. We must manage India relations carefully as the country remains a large trading partner for us. It is in our interests to work with progressive elements in the Indian government, both state and federal levels, to foster an environment of mutually beneficial relationships. Our media must become aggressive to counter the fake news from Indian media. Our economic interests require that we have a united front in dealing with external threats. Any game played by our political parties to undermine our economy must be exposed by the media.

As for exportable products, we should start focusing on other manufactured items such as semiconductor devices, electronics and electrical parts, software, rubber products, plastics, medicines, and parts for various products used in western manufacturing facilities such as automobiles, solar panels, etc. We have strong pharmaceutical production facilities and can expand this significantly to reach markets in Africa, Asia and South American markets. We must do in-depth research on what we can export to China. We are 98% self-sufficient in medicines, thus expanding production to export markets should be done. We are also increasing our production capacity in shipbuilding.

Bangladesh is the second-largest economy in South Asia and the 35th-largest economy in the world. The country has the highest number of green garment factories in the world. We have real potential to increase domestic investments as well as increase exports of our products to many countries. We now have the political commitment to reduce corruption, strengthen the rule of law and improve the banking system so that we can expand our economic activities. Our political parties need to start talking about how they want to transform Bangladesh's economy as opposed to clamoring for election only without providing a roadmap for economic development and much-needed reforms. We must increase our exports to reduce deficits and expand our economy, thus creating more jobs for our people. Diversifying exports will reduce the risk associated with dependency on a few products.
_____________________________________
The writer is an international development expert and now based in the USA