India`s Free Trade Agreement with Bangladesh

India and Bangladesh have enjoyed a long-standing relationship when it comes to trade and commerce. This has been further strengthened with the signing of the India-Bangladesh Free Trade Agreement (FTA) in 2019. This agreement has opened up doors for greater opportunities for businesses in both countries to expand their markets and create new growth avenues. In this article, we will discuss the key aspects of the India-Bangladesh FTA and what it means for businesses in both countries.


India and Bangladesh have always had a strong economic relationship, with India being one of the largest trading partners of Bangladesh. In fact, in the fiscal year 2019-20, India`s exports to Bangladesh amounted to $9.21 billion. However, there have been long-standing issues related to trade imbalance, non-tariff barriers, and restrictions on the entry of Indian goods into Bangladesh. To address these issues, the two countries signed the FTA in September 2019, which aims to promote bilateral trade and investment in a mutually beneficial way.

Salient features of the FTA

The key features of the India-Bangladesh FTA are as follows:

1. Duty-free access: The FTA provides duty-free access to a wide range of products traded between the two countries. This includes textile and clothing items, automobile parts, machinery, electronics, and agricultural products.

2. Trade in services: The FTA also provides for greater cooperation in trade in services, including professional services, IT, and financial services.

3. Non-tariff barriers: The FTA aims to reduce and eliminate non-tariff barriers in trade between the two countries. These include technical regulations, licensing requirements, and other trade-related measures.

4. Rules of origin: The FTA also lays down clear rules of origin, which will help in preventing misuse of the agreement and ensuring that only genuine products from either country benefit from the duty-free access.

Impact on businesses

The India-Bangladesh FTA is expected to have a significant impact on businesses in both countries. For Indian businesses, it means greater access to the Bangladeshi market, which is growing rapidly and offers immense potential. For Bangladeshi businesses, it means access to a larger market and cheaper inputs from India. The FTA is likely to boost trade and investment flows in both directions and create new opportunities for businesses to expand their markets.


The India-Bangladesh FTA is a landmark agreement between the two countries, which is aimed at promoting mutual economic growth and development. It provides a comprehensive framework for trade and investment cooperation, which is expected to yield significant benefits in the long run. As businesses in both countries gear up to take advantage of the opportunities provided by the FTA, it is important that they keep in mind the rules and regulations laid down in the agreement to ensure that they can fully benefit from it.