The United States has decided to reduce the reciprocal tariff on imported goods from Bangladesh to 20 per cent from the previously announced 35 per cent following a series of negotiations over the past month.
However, economists said, despite bringing short-term relief, the decision raised questions about what Bangladesh might have offered to the US in return.
Due to the non-disclosure agreement, what was offered remains unknown except the plan to purchase Boeing aircraft and wheat.
According to a statement announced by the White House on Friday, US President Donald J Trump unveiled new tariff rates for 70 countries, including Bangladesh.
After the final round of the tariff talks between a Bangladesh delegation and US officials, the North American country declared the new tariff rate.
Regarding the reduction in reciprocal tariff rate, chief adviser Muhammad Yunus congratulated the Bangladesh tariff negotiators on securing a 鈥榣andmark鈥� trade deal with the US, according to statement issued by the CA press wing.
The statement also said that by reducing the tariff to 20 per cent, the negotiators demonstrated remarkable strategic skill and unwavering commitment to safeguarding and advancing Bangladesh鈥檚 economic interests.
鈥楾he agreement they negotiated preserves our comparative advantage, enhances our access to the world鈥檚 largest consumer market and safeguards our core national interests,鈥� the statement added.
The new tariffs came into effect on August 1, meaning Bangladeshi exporters would now pay an average of 15 per cent regular tariff along with an additional 20 per cent reciprocal tariff.
Earlier, on July 8, through a letter to the chief adviser, Washington imposed a 35 per cent reciprocal tariff, meaning the newly declared rate has been reduced by 15 percentage points.
Among the close competitors of Bangladeshi goods聽 in global trade, the White House imposed tariff rates on Indian goods at 25 per cent, Pakistani goods at 19 per cent, Vietnamese goods at 20 per cent, Cambodian at 19 per cent, and Indonesian goods at 19 per cent.
Chinese and Mexican goods were not on the list.
The tariffs on Bangladesh neighbours Afghanistan are 15 per cent, Sri Lanka 20 per cent, and Myanmar 40 per cent, according to the Annex 1 list of the White House.
On the tariff negotiations, power and energy ministry adviser Muhammad Fouzul Kabir Khan praised commerce adviser Sk Bashir Uddin in a social media post.
He said that from domestic price stability to successful tariff negotiations with the US he had proved his mettle to the dismay of naysayers.
On April 2, US President Donald Trump announced steep tariffs on several countries, citing trade deficit concerns.
At that time, Bangladesh was subject to a 37 per cent tariff.
On April 9, Washington put on hold the tariffs for three months, giving countries an opportunity to negotiate, which ended on July 9.
Trump sent letters to country heads on July 8 setting new tariff rates and gave until 31 July to reach trade agreements with the US.
During this time, Bangladesh conducted a series of negotiations and agreed to purchase Boeing aircraft and wheat to cut the trade deficit with the US.
Regarding the tariff reduction, Professor Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue, said that the reduction in tariff rates brought some relief and diminished uncertainty.
鈥楬owever, concern persisted regarding what was offered against the tariff reductions. The matters must be evaluated through the clauses of the Non-Disclosure Agreement,鈥� he added.
Regarding the tariff reduction, Bangladesh also agreed to import more from the US along with intellectual property law implementation, custom waiver for US products, trade union rights, and others.
鈥楾he tariff reduction must be evaluated through the gain and the offers,鈥� he added.
He also said that the tariff reduction might also create some challenges over the cost of the offering from Bangladesh, especially on buying LNG, aircraft, and other goods.
Moreover, it might reshape the import scenario from Bangladesh鈥檚 global trading partners, like Russia and China.
鈥業t also accelerated Bangladesh to do more works on intellectual property rights, trade union, and institutional reform,鈥� he added.
He further said that the reduction must bring relief for the country鈥檚 exporters as the rates declared were almost similar to the major competitors.
In 2024, Bangladesh exported to the US goods worth about $8.4 billion, of which $7.34 billion accounted for readymade garments. In the year, the country imported US goods worth $2.2 billion.
Against this backdrop, the US is pressing Bangladesh to lower the trade deficit to get a 鈥榝avourable鈥� tariff rate.
With a view to reducing the trade deficit, Bangladesh on July 27 planned to purchase 25 Boeing aircraft.
Earlier, on July 20, Bangladesh signed a memorandum of understanding with the US to import seven lakh tonnes of wheat annually for the next five years to reduce the trade deficit with the US.
On July 23, the interim government decided to procure 2.20 lakh tonnes of wheat from the US at $302.75 a tonne.
Mohammad Abdur Razzaque, chair of Research and Policy Integration for Development, said that the 20 per cent US tariff on Bangladeshi exports was a relief in terms of maintaining parity with competitors.
However, he warned, the overall trade deal must be evaluated in light of the offers made by Bangladesh, many of which remain undisclosed.
鈥楿nderstanding the full scope of our obligations is essential to evaluate whether this outcome truly serves our long-term interests,鈥� he added.
Selim Raihan, executive director of the South Asian Network on Economic Modeling, said that the reduction in the US reciprocal tariff rate for Bangladesh was a welcome development for the country鈥檚 export sector.
However, it also raised questions about what Bangladesh鈥檚 offers to the US were.
鈥楽ome of these commitments have been made public but it was reasonable to assume that more sensitive obligations may have been agreed upon under the NDA,鈥� he added.
He also said that the country needed to build greater resilience, including diversifying the export basket, domestic reforms in trade, taxation, and investment policies, and investment in the regulatory and business environment.
Economists also said that while the downward adjustment in the reciprocal tariff rate was encouraging, it should not lead to complacency.
Rather, it presents an opportunity, and a clear warning, for Bangladesh to take proactive steps toward building a more diversified, competitive, and resilient trade strategy.
