Bangladesh leads in bilateral trade with 122 countries, lags behind in 104

Although Bangladesh trades with 226 countries and territories across the world, this trade is not evenly distributed across all continents.

While Bangladesh remains ahead in foreign trade due to strong export performance in Europe and North America, the country continues to face trade deficits in Asia, Africa and South America.

An analysis of data from the National Board of Revenue (NBR) shows that in the 2024–25 financial year, Bangladesh recorded a trade surplus with 122 countries in its bilateral trade.

However, this achievement was overshadowed by trade deficits with 104 countries, as the magnitude of the deficits far exceeded the surpluses.

According to NBR data, Bangladesh exported USD 46.57 billion (4,657 crore) worth of goods to 201 countries in the last financial year.

During the same period, imports from 206 countries amounted to USD 67.44 billion (6744 crore).

Consequently, the country ended the financial year with a foreign trade deficit of USD 20.87 billion (2087 crore). Combined imports and exports resulted in a total foreign trade volume of approximately USD 114.02 billion (11402 crore).

The United States, one of the world’s largest consumer markets, remains the most favourable trading partner for Bangladesh. In the last financial year, Bangladesh exported goods worth USD 8.76 billion (876 crore) to the United States while importing goods worth USD 2.50 billion (250 crore). This resulted in a trade surplus of USD 6.26 billion (626 crore), the highest with any single country.

Four decades ago, the United States introduced quota facilities for countries like Bangladesh, which contributed to the growth of Bangladeshi exports to the US market. Over time, the United States has become one of Bangladesh’s largest single export destinations.

Despite the imposition of retaliatory tariffs, Bangladesh continues to maintain a favourable position in this market.

Apart from the United States, Bangladesh also enjoys trade surpluses with several other North American countries, including Canada, Mexico and Panama.

During the last financial year, Bangladesh exported USD 10.67 billion (1067 crore) worth of goods to 25 countries and territories in North America, while imports stood at USD 3.48 billion (348 crore). This resulted in a regional trade surplus of USD 7.19 billion (719 crore).

Bangladesh also maintains a strong position in its trade relations with European countries. Imports from Europe are relatively low compared to the volume of exports, largely due to Europe being a major market for Bangladeshi ready-made garments.

This single product category significantly contributes to Bangladesh’s bilateral trade surplus with the countries of the European Union.

In the last financial year, Bangladesh exported USD 26.76 billion (2676 crore) worth of goods to 51 European countries and autonomous territories, while imports from the region amounted to USD 5.10 billion (510 crore).

As a result, Bangladesh recorded a substantial trade surplus of USD 21.66 billion (2166 crore) with Europe.

In Asia, Bangladesh’s largest bilateral trade deficit is with China. In the last fiscal year, Bangladesh imported goods worth USD 20.61 billion (USD 2,061 crore) from China, while exports amounted to only USD 740 million (USD 74 crore). As a result, Bangladesh’s bilateral trade deficit with China stood at USD 19.87 billion (USD 1,987 crore).

After China, India comes next in terms of a large deficit. Although, deficit with the neighbouring country is shrinking as exports have been increasing. Despite that Bangladesh imported goods worth USD 9.68 billion (USD 968 crore) from India in the last fiscal year and exported goods worth USD 1.82 billion (USD 182 crore). This created a bilateral trade deficit of USD 7.86 billion (USD 786 crore).

An analysis of the data shows that Bangladesh imports heavily from China and India, but much of this contributes indirectly to exports to Europe and America. This is because Bangladesh imports a large portion of its export-oriented raw materials from these two countries, which are then used to produce goods for export to European and American markets.

According to NBR data, 54 per cent of Bangladesh’s imports from China in the last fiscal year consisted of raw materials for export-oriented industries, while the remaining 46 per cent were commercial products. Similarly, 31 per cent of imports from India were raw materials for export-oriented industries.

Both countries meet a large share of Bangladesh’s domestic market demand. Goods can be imported from neighbouring India at lower costs and with shorter lead times. China, however, remains a major source of raw materials for the garment industry as well as commercial and electronic products. Cheaper imports from both countries benefit Bangladeshi consumers as well.

Like China and India, Bangladesh also imports far more than it exports to Middle Eastern countries. Overall, Bangladesh has bilateral trade relations with 51 Asian countries, accounting for 50 per cent of the country’s total bilateral trade last fiscal year.

Bangladesh is quite lagging in bilateral trade with countries of South America, Africa and Oceania as well. In South America, imports from Brazil, Argentina and Paraguay exceed exports.

Bangladesh mainly imports agricultural products such as soybean oil, soybean seeds and wheat from these countries. In the last fiscal year, Bangladesh imported goods worth USD 3.89 billion (USD 389 crore) from South America, while exports stood at only USD 600 million (USD 60 crore), leaving a deficit of USD 3.29 billion (USD 329 crore).

Exports to African countries are also low compared to imports. In the last fiscal year, Bangladesh imported goods worth USD 2.81 billion (USD 281 crore) from Africa and exported goods worth USD 440 million (USD 44 crore), resulting in a deficit of USD 2.37 billion (USD 237 crore).

In a similar pattern of trade, exports to countries in Ocenia last fiscal year totalled USD 1.03 billion (USD 103 crore), while imports reached USD 1.85 billion (USD 185 crore), leaving a trade deficit of USD 830 million (USD 83 crore).

Business leaders say Bangladesh remains highly dependent on imports, from raw materials to finished goods. Only a few import-substitution industries have developed, so dependency remains high. Additionally, Bangladesh’s export basket is narrow, with limited progress in exporting technology-driven products.

For example, ready-made garments accounted for nearly 85 per cent of last fiscal year’s exports, totalling USD 39.47 billion (USD 3,947 crore). The second-largest sector, leather and leather goods, accounted for only around two per cent or USD 1.13 billion (USD 113 crore). No other sector crossed the billion-dollar export mark.

Higher imports also mean higher transportation costs for goods arriving in Bangladesh, costs mainly borne by importers. But as exports are low, outbound freight costs remain low and are mostly paid by foreign buyers.

Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue (CPD), told Prothom Alo that a country may have a surplus with some nations and a deficit with others, but the goal should be a surplus in overall foreign trade.

To achieve this, investment, trade and connectivity, these three must be aligned to enhance competitiveness, which would help increase exports. Alongside diversifying man-made fibre apparel, Bangladesh must also diversify its overall export products, he added.

Mustafizur Rahman said, “More than 60 per cent of our imports come from South Asia, East Asia and ASEAN countries, but exports to these regions are limited to around 12 per cent. These countries import a huge volume of goods. We must focus on expanding exports to these markets. That’s how we can achieve a surplus in foreign trade.”

When asked about reducing the bilateral trade gap, Amirul Haque, managing director of SEACOM Group, told Prothom Alo, “Two things are essential to reduce the trade deficit. First, the government must improve the negotiation capacity at policy level. With countries from which we import heavily, we must ask them, what will you buy from us? For example, we face many tariff and non-tariff barriers in India, and visas are not easily available. How will exports grow then?”

“Second, the government must ensure entrepreneurs’ rights rather than merely offering assistance. For example, uninterrupted gas and electricity supply would help industries grow, leading to more diversified exports. This would increase exports and help reduce the bilateral trade deficit,” he added.