Bangladesh wants to sign CEPA with India in a year

[UKBengali]

India and Bangladesh do not produce any high end stuff. If we have an FTA deal with them they will send their products into our country that we have a potential to produce in the near future. Those industries then will never flourish.

I am for FTA with advanced countries like USA, Europe and China. Under FTA they for example can sell us aeroplane which we don't produce and no hope of producing in the near future, we will import them anyway, but the FTA will in return allow our products to enter their markets without issues. The same arrangement doesn't work with countries that are not industrially advanced.

Disagree.

BD is well established in the areas of electronics and pharmaceuticals.

In the first category, there is no comparable product that India can produce at any price and in pharmaceuticals BD is very competitive.


Remember as India is a much larger market than India, with FTA BD pharma companies will be able to sell many times more in India than the other way round.

The areas that you are looking for is in cars and vehicles but as BD has a policy to not develop these industries then it will not matter. To get round the FTA, BD can just put a massive VAT on each car sold to discourage the sales of these products in BD.

 

[pikkuboss]

Disagree.

BD is well established in the areas of electronics and pharmaceuticals.

In the first category, there is no comparable product that India can produce at any price and in pharmaceuticals BD is very competitive.


Remember as India is a much larger market than India, with FTA BD pharma companies will be able to sell many times more in India than the other way round.

The areas that you are looking for is in cars and vehicles but as BD has a policy to not develop these industries then it will not matter. To get round the FTA, BD can just put a massive VAT on each car sold to discourage the sales of these products in BD.

VAT applies to domestic producers also. You can't stop import with VAT. BD has no chance against India in Pharma. If BD can replace cheap Chinese electronics segment with cheap Bangladeshi electronics, we will be more than happy, BD has no chance in high end electronics as all major electronics brands in the world are making India their base.

 

[UKBengali]

VAT applies to domestic producers also. You can't stop import with VAT. BD has no chance against India in Pharma. If BD can replace cheap Chinese electronics segment with cheap Bangladeshi electronics, we will be more than happy, BD has no chance in high end electronics as all major electronics brands in the world are making India their base.

For a start please actually try to read and understand the post that you are responding to.


Yes BD canot stop import with VAT but it can make sure that any imported cars are so expensive that virtually no-one can afford them. As BD has no intention of developing a car industry it does not harm it's own industries and India gets no benefit from FTA in this area.

As for electronics, please do some research on Walton and then come back. BD has allowed all the major electronics manufacturers like Samsung and LG into the BD market and they even assemble locally but Walton can hold it's own. It dominates the TV sector in BD with around half of all sales.


As regards pharma yes India is strong but BD can make drugs at similar quality and value to Indian producers in most segments. There are a few areas where BD will either not have the product or is not competitive for sure.

 

[nahtanbob]

LOL What logic is it ? It is billateral cooperation while RCEP is regional one

The truth is Indonesia will have preferred trade deal with both BD and India. It is on progress and expected to be concluded this year.

The only reason for not signing RCEP is the membership of China in the RCEP. That was the reason given by Indian ministers (not mine).
It is not clear where it leaves bilateral free trade agreements

 

[bluesky]

Bhai $2 Billion is peanuts.

"In 2020, Bangladesh exported $1.01B to India. The main products exported from Bangladesh to India were Other Pure Vegetable Oils ($112M), Non-Knit Men's Suits ($98.3M), and Textile Scraps ($65.8M)".

The above is what an internet source says. It was about$1 billion in 2020. How come it will be $2 billion this year?

I ask @UKBengali to send the 2021 data to prove his point.

But, please note above the main items exported from BD.

 

[Bilal9]

VAT applies to domestic producers also. You can't stop import with VAT. BD has no chance against India in Pharma. If BD can replace cheap Chinese electronics segment with cheap Bangladeshi electronics, we will be more than happy, BD has no chance in high end electronics as all major electronics brands in the world are making India their base.

You underestimate the capabilities of some brands in Bangladesh because you do not know. Bangladeshi electronics and appliance products are anything but "cheap". On average - prices paid for electronics/appliances in Bangladesh are higher than India because their standards and expectation were always higher compared to Indian expectations - even more so today. That was always the case even sixty years ago during when Bangladesh was East Pakistan.

Average middle and upper middle income homes in Bangladesh always were equipped with more modern appliances compared to their Indian counterparts, even if they were imported. Indian TVs (Videocon) and refrigerators (Godrej) could not make a mark in that Bangladeshi market because of quality issues. Fridge sizes in Bangladesh are always larger than those used in Indian homes. Bangladeshi families never liked teeny-tiny 150 liter fridges. I have discussed this before.

Here is the avg. 150 litre fridge sold in India for families - the most common.

Bangladeshi fridges are on average 300 litres and up - no one in Bangladesh will buy 150 litre or 200 litre fridges.

Walton was showcasing 8K TVs and Bangla voice controlled fridges and aircons in the last national fair last quarter (Hindi and South Indian voice-control can be added). Some brands in Bangladesh do have quite a few higher echelon products to compete in those segments in Indian markets. Even in higher echelon products - there are price buyers to some extent, with sufficient guarantees and warranties offered. I am more than certain that is the case in India.

Products assembled in India from foreign CKD and SKD kits (even produced in large volumes) can't compete with Bangladeshi high end products on price, once Indian NTBs and tariffs are withdrawn from Bangladeshi products. The level of indigenization on critical parts in Bangladeshi electronics and major home appliances (washing machines, refrigerators, aircons) is quite deep - especially in Walton's case. If needed - Walton will start limited SKD assembly in Indian market for appliances.

At this point - it's just Indian intransigence and what in Bangla we say "Goartumi" (block-headed behavior) to "block" Bangladeshi products imported into Indian market, at any cost - while allowing assembly of foreign products in India which add zero "real" value to Indian economy.

Some dosti overtures from a "friend"....

 

[UKBengali]

You underestimate the capabilities of some brands in Bangladesh because you do not know. Bangladeshi electronics and appliance products are anything but "cheap". On average - prices paid for electronics/appliances in Bangladesh are higher than India because their standards and expectation were always higher compared to Indian expectations - even more so today. That was always the case even sixty years ago during when Bangladesh was East Pakistan.

Average middle and upper middle income homes in Bangladesh always were equipped with more modern appliances compared to their Indian counterparts, even if they were imported. Indian TVs (Videocon) and refrigerators (Godrej) could not make a mark in that Bangladeshi market because of quality issues. Fridge sizes in Bangladesh are always larger than those used in Indian homes. Bangladeshi families never liked teeny-tiny 150 liter fridges. I have discussed this before.

Here is the avg. 150 litre fridge sold in India for families - the most common.

Bangladeshi fridges are on average 300 litres and up - no one in Bangladesh will buy kanjoosi 150 litre or 200 litre fridges.

Walton was showcasing 8K TVs and Bangla voice controlled fridges and aircons in the last national fair last quarter (Hindi and South Indian voice-control can be added). Some brands in Bangladesh do have quite a few higher echelon products to compete in those segments in Indian markets. Even in higher echelon products - there are price buyers to some extent, with sufficient guarantees and warranties offered. I am more than certain that is the case in India.

Products assembled in India from foreign CKD and SKD kits (even produced in large volumes) can't compete with Bangladeshi high end products on price, once Indian NTBs and tariffs are withdrawn from Bangladeshi products. The level of indigenization on critical parts in Bangladeshi electronics and major home appliances (washing machines, refrigerators, aircons) is quite deep - especially in Walton's case. If needed - Walton will start limited SKD assembly in Indian market for appliances.

At this point - it's just Indian intransigence and what in Bangla we say "Goartumi" (block-headed behavior) to "block" Bangladeshi products imported into Indian market, at any cost - while allowing assembly of foreign products in India which add zero "real" value to Indian economy.

Some dosti overtures from a "friend"....

If there is a FTA with India, Indian consumers will get high quality electronic products at competitive prices.

Companies like Walton can sell hundreds of millions dollars if not in the billions every year and that is why I welcome FTA with India.

The biggest winners will actually be the Indian consumer here as Walton will be successful with or without the India market.

Walton has just started selling its products in Ireland - country with gdp per capita 30 times that of India.

 

[Bilal9]

"In 2020, Bangladesh exported $1.01B to India. The main products exported from Bangladesh to India were Other Pure Vegetable Oils ($112M), Non-Knit Men's Suits ($98.3M), and Textile Scraps ($65.8M)".

The above is what an internet source says. It was about$1 billion in 2020. How come it will be $2 billion this year?

I ask @UKBengali to send the 2021 data to prove his point.

But, please note above the main items exported from BD.

 

[Bilal9]

Bangladeshi Electronics Brands Going Global

 

[Two banks of the River]

The problem with FTA will be agriculture. Especially states like Bihar and West Bengal etc will complain.

 

[UKBengali]

The problem with FTA will be agriculture. Especially states like Bihar and West Bengal etc will complain.

BD does not have much food to export as most of it is for internal consumption.

FTA is the next step to propel the economic growth in the region to a higher level.

 

[Indos]

The problem with FTA will be agriculture. Especially states like Bihar and West Bengal etc will complain.

BD is not well known as agriculture products exporter, mostly BD can self sustain in agriculture and maybe fisheries.

India is major agriculture exporter and the government subsidy for this is mind blowing. It is good for other countries as it can get cheap agriculture products like in the case of Singapore, Malaysia, Philippine which agriculture demand is mainly coming from import.

Malaysia only good at palm oil and durian, other like rice, etc needs to be imported

 

[Two banks of the River]

BD does not have much food to export as most of it is for internal consumption.

FTA is the next step to propel the economic growth in the region to a higher level.

FTA is obviously good. But who will explain it to the left minded leaders who will gather up farmers in their support against this?

BD is not well known as agriculture products exporter, mostly BD can self sustain in agriculture and maybe fisheries.

India is major agriculture exporter and the government subsidy for this is mind blowing. It is good for other countries as it can get cheap agriculture products like in the case of Singapore, Malaysia, Philippine which agriculture demand is mainly coming from import.

Malaysia only good at palm oil and durian, other like rice, etc needs to be imported

Pvt sector is slowly getting into the agricultural sector in India. I hope within this decade the subsidies are substantially reduced.

 

[Bilal9]

The problem with FTA will be agriculture. Especially states like Bihar and West Bengal etc will complain.

Real situation is that both Bihar and WB's economic raison d'être to exist is to sell their agricultural produce as well as minerals to Bangladesh as food processing input, electricity and industrial raw material. I doubt there will be complaints.

In FY21, India's top export items to Bangladesh were cotton and cotton yarn ($1.5 billion), electricity ($517 million), fuel ($496 million), rice ($354 million), and corn ($328 million). Most of the rice and energy came from those two states. And of course the trucks to carry all the goods are all leased from those two states as well.

 

[Two banks of the River]

Real situation is that both Bihar and WB's economic raison d'être to exist is for selling their agricultural produce as well as minerals to Bangladesh as food and raw material. I doubt there will be complaints.

In FY21, India's top export items to Bangladesh were cotton and cotton yarn ($1.5 billion), electricity ($517 million), fuel ($496 million), rice ($354 million), and corn ($328 million). Most of the rice and energy came from those two states. And of course the trucks to carry all the goods are all leased from those two states as well.

Thanks, I really didn't know about the Rice export part.