Re-assessing export-import policies necessary to meet the challenges of post-LDC challenges: DCCI Seminar

Export-import policy reform is key to resilience and long-term competitiveness

Bangladesh’s export sector, heavily concentrated on the ready-made garment industry, as a major engine of economic growth, is contributing over 84% of total export earnings. While other sectors like pharmaceuticals, leather, jute, agro-processed goods, the automobile industry and ICT are not gaining traction, likewise the RMG sector. In the export basket, the overall export base remains narrow and mostly dependent on a few markets. The comments were made by Taskeen Ahmed, President of Dhaka Chamber of Commerce & Industry (DCCI) at a seminar on “Export-import policies in Bangladesh: Requirements and Challenges upon LDC Graduation” held on 24 May, 2025 at DCCI auditorium.

He also said that, Bangladesh’s import composition reflects a strong industrial reliance on foreign inputs, including capital machinery, raw materials and intermediate goods. This structural dependence has made the economy particularly vulnerable to external shocks. Moreover, recent inflation surge coupled with ongoing U.S. reciprocal tariffs and export ban by India have exerted significant pressure on the balance of payment, foreign exchange reserve and import control mechanisms. Consequently, businesses are struggling to source essential materials, which is undermining their competitiveness and production capacity, he added.

He later suggested for policy and financial support for the potential non-RMG sectors. Moreover, he stressed on adopting a balanced and predictable tariff policy to facilitate import of raw materials and capital goods. To avoid mismatch of export and import policy, a comprehensive trade policy is essential as this practice sustains in other neighboring economies, he opined.

Dr. Selim Raihan, Professor of Economics, Dhaka University & Executive Director, SANEM said customs duties and tariff rates in Bangladesh are higher compared to neighboring countries. Moreover, the country has still high dependence on import taxes. Lack of reform in the taxation sector and the government’s inability to raise taxes through direct taxation resulted in high dependence on indirect taxes and import taxes. In terms of export policy, Bangladesh relies heavily on cash incentives and duty drawbacks to support narrowly focused RMG-dominated export base, with limited diversification, low flow of FDI and trade facilitation challenges. On the other hand, in the context of import policy, Bangladesh maintains higher tariffs, non-tariffs and complex para-tariffs compared to its peers, with manual customs and import-substitute protectionist tendencies in some sectors. Keeping all these in mind, he however suggested for establishing a unified trade policy framework, dynamic tariff adjustments, enhanced policy coordination and stakeholder engagement. Successful execution of national tariff policy 2023 is also crucial for economic diversification, he added. More focus needs to be given on product and market diversification beyond ready-made garment and E.U. and U.S. markets. Later, he stressed on gradual reduction of para-tariffs, modernizing import policy, streamlining customs procedures, enhancing trade facilitation, automation and leveraging regional and global value chains. Prof. Raihan also emphasized on improving policy coherence across the trade, industrial and fiscal domains. He concluded his presentation by saying that export-import policy reform is the central to build resilience and long-term competitiveness.  

Lutfey Siddiqi, Special Envoy to the Chief Adviser on International Affairs said that structural and institutional reforms among the government agencies are also necessary, and the pace of doing the reforms needs to be faster. He said, we do not have any roadmap in the industrial sector not even in other sectors as well. But there should be a roadmap for national tariff policy, he added. He also opined that institutionalizing and government readiness are the master-key of development. He added that ports are the heart of the economy, so it is important to ensure logistic and keep their management running and operating smoothly. He said that as a part of civil society, the business community has its own power and he suggested the community to present their logical demands to the government firmly to achieve, as the private sector is the main driving force of the country’s economy.

Dr. Anisuzzaman Chowdhury, Special Assistant, Economic Relations Division (ERD), Ministry of Finance said Bangladesh has to graduate from the LDC status and we have no option to come back now, but we have to focus on producing high-value ready-made garment, medicine and light engineering items to meet the post-LDC challenges. He said a national dialogue will be held soon with the participation of all stakeholders to chalk out the next course of action for the post-LDC era. He also said that we have human capital, financial capital and physical capital and now we just need to build trust. He also stressed on integration and coherence of policies for boosting the economy.

Kazi Mostafizur Rahman, Member (Customs: Audit, Modernization & International Trade), NBR said that after 1993, NBR has been implementing ASYCUDA and various other automated systems to ensure the services are transparent. He also said that after post-LDC era, in various negotiation processes, there should be private sector participation. Because of having limited export items and more dependence on RMG, sometimes we lag behind in global bargaining, he said. He later informed that an initiative has been taken to start a central bonded warehouse and hoped that this facility could be provided to all by next July. He also urged all businessmen to avail the facility of national single window. NBR has taken an initiative to introduce electronic data exchange system, which will allow traders to smoother export, import services.

Md. Anwar Hossain, Vice Chairman, Export Promotion Bureau (EPB) said effective policy support rather than cash incentives will be the key to meet the challenges of post-LDC era. He said there are lots of non-traditional items we can look into for product diversification utilizing duty benefits. He said the government is working on three important issues – trade policy reforms, compliance and standard, and private sector preparedness. He also urged the private sector to come forward to use man-made fiber in the ready-made garment sector. He later said that if the private sector gets proper infrastructure, energy security, credit facility, policy support and logistics services, it is possible to earn USD 100 billion from the readymade garment sector in next 2-3 years.

Md. Fazlul Haque, former President, BKMEA said there will be no harm of ready-made garment industry even after LDC graduation. But a few challenges will come and we have to be prepared for those from now. He also stressed on producing high-value products manufactured from man-made fibre. He said after graduation cash incentives will not be allowed but how can we provide an alternative of cash incentive to the industries that needs to be planned well ahead. Later he opined that only RMG dependence will not bring any good to the economy in future.

Md. Moshiul Alam, Joint Chief, Bangladesh Trade and Tariff Commission said that being an LDC country we are giving cash incentives to almost 43 products. But after graduation this facility will not be available but in which method or capacity we can facilitate the industry alternatively, we need to figure it out. In that case, what the other countries do, we may observe. Moreover we need to go for signing reciprocal FTAs with potential countries. He said the products those are discouraged to import should not have any duty imposed because it increases the average of tariffs.

Syed Almas Kabir, former President, BASIS proposed to set up five marketing offices in five potential countries to expand the export of new products in the existing market. He further suggested to sign as more FTA/PTA as we can. He said that with product diversification we should go for product extension as well as different products from single item. Now we should focus on creating our own brand with our own IP. For skill development, re-skilling and up-skilling we need to incentivize innovative research under the private sector.

Dr. Md. Zakir Hossain, Managing Director, Delta Pharma Ltd. said that Bangladesh’s pharmaceutical products are being exported to 157 countries though the volume is low. But it is a good sign that we can produce good quality medicines. He further requested the government to negotiate with WTO so that even after LDC graduation, Bangladesh can avail the waiver under TRPS for at least next six years to produce patented medicines. If we fail, the price of medicines in the local market will go high due to loyalty charge, he informed. He also suggested to allow foreign companies to establish joint research centers in Bangladesh so that Bangladesh can avail the scope of technology adaptation from the technologically advanced nations.

Fakir Kamruzzaman Nahid, Managing Director, Fakir Fashion Ltd. said that the discontinuation of GSP facilities following the LDC graduation would lead to a 9.5% increase in the price of Bangladesh’s ready-made garments, which would significantly hinder the country’s competitiveness in the global market. He also stressed the importance of automating port operations to reduce lead time during the time of export. He also said that the RMG industry lags behind to tap the opportunity of man-made fiber or synthetic fiber, this sector is still untouched. We are using natural fibers a lot.

Meanwhile, former DCCI Directors A.K.D. Khair Mohammad Khan, M. Bashir Ullah Bhuiyan, and Joint Convenor Salahuddin Yusuf, among others, participated in the open discussion.

Senior Vice President of DCCI, Razeev H. Chowdhury, Vice President Md. Salim Sulaiman, members of the Board of Directors, and stakeholders from both public and private sectors were present during the event.

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