Bangladesh grapples with its largest trade deficit in South Asia as India escalates anti-dumping cases, prompting Dhaka to seek greater market diversification and strengthened negotiations amid ongoing trade tensions.
Bangladesh’s trade relationship with India remains marked by a deep imbalance even as officials in Dhaka look for ways to widen market access and lower dependence on its larger neighbour. In fiscal year 2024-25, Bangladesh exported goods worth about $1.76 billion to India while importing roughly $9.62 billion, leaving a deficit of $7.86 billion, according to figures cited by the Industries Ministry and later repeated in parliament by the Commerce Ministry. The gap is the largest Bangladesh has with any South Asian partner and reflects heavy reliance on Indian cotton, yarn, machinery, petroleum products, chemicals and food commodities.
That backdrop has sharpened concern over India’s latest trade remedy case against Bangladesh. The Directorate General of Trade Remedies has set a virtual hearing on 6 August in an anti-dumping probe into imports of polyethylene terephthalate film, or PET film, a material widely used in packaging for food, medicines, cosmetics and industrial products. According to Bangladeshi Commerce Ministry sources cited in local reporting, the case follows a complaint from Indian producers who allege that imports from Bangladesh, China and Thailand were being sold at unfairly low prices and damaging the domestic industry.
For Bangladesh, the PET film inquiry fits a familiar pattern. India has already imposed anti-dumping duties on Bangladeshi jute products, including yarn, twine, woven fabrics and sacking bags, as well as on hydrogen peroxide. In June, Indian authorities recommended keeping the jute duties in place, with rates of between $19 and $352 per tonne reported by local media. Those measures have weighed on Bangladeshi exporters, especially in jute, where India once accounted for a much larger share of shipments. Research published in 2024 found evidence that Indian anti-dumping duties have reduced trade in a number of Bangladeshi products and, in some cases, diverted exports to other markets.
Still, the record also suggests that these disputes are not always permanent. India withdrew duties on hydrogen peroxide in 2022 after a sunset review found insufficient evidence that removing the levy would revive dumping and injury. Bangladeshi officials handled that case through cooperation with investigators, the submission of cost and pricing data and sustained diplomatic engagement rather than retaliation. That outcome has become an important reference point in Dhaka, where policymakers have argued that transparent data and legal engagement under World Trade Organization rules can sometimes reverse punitive trade measures.
The broader lesson for Bangladesh may be that the answer lies less in confrontation than in diversification and negotiation. Officials and exporters have repeatedly pointed to the need to broaden sales beyond India, while also improving pricing transparency and using bilateral and multilateral channels more effectively. That discussion has taken on added urgency as the government considers a Comprehensive Economic Partnership Agreement with India, a potential framework designed to narrow the trade gap and strengthen economic ties. For now, the PET film case is another test of whether Bangladesh can protect its export interests without allowing a trade dispute to spill into the wider relationship.
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