Economists and researchers had raised questions from the very beginning about the trade agreement signed in the final days of the interim government aimed at reducing the US reciprocal tariff.
Last Friday, after the US Supreme Court declared that reciprocal tariff illegal, the agreement has come under renewed criticism.
An analysis of trade data between the two countries shows that in the reciprocal tariff agreement, the balance of benefits is heavily weighted in favour of the United States.
According to the agreement, Bangladesh would have to provide tariff concessions on 6,710 US products. In return, the US was to grant tariff-free benefits on 1,638 Bangladeshi products. But the reciprocal tariff, which was the basis for determining these benefits, has now been annulled by the US court.
As a result, Bangladesh’s practical advantages in the US market will be greatly limited.
An analysis of the 2025 import–export data from the National Board of Revenue (NBR) shows that of the 6,710 US products for which tariff concessions were mentioned, Bangladesh imported at least 2,016 products last year.
The total import value of these products was about 65 million US dollars. If the agreement had taken effect, and tariffs on these products were gradually reduced or eliminated, Bangladesh’s revenue could have decreased by about Tk 4.19 billion.
On the other hand, the actual picture of the benefits promised by the US for Bangladeshi products is very limited. According to the agreement, the US was to provide benefits on 1,638 Bangladeshi products, but last year, only 14 of these products were actually exported to the US. The total export value of these products was about 670,000 dollars. If Bangladesh had received reciprocal tariff benefits on these products, the US government would have had to forgo about 125,000 dollars in revenue, roughly Tk 15 million.
According to reports published in various international media, after the Supreme Court ruling, the reciprocal tariff decision by Trump has been annulled. Therefore, Trump has announced a new 15 per cent tariff. As a result, even if the agreement remains in place, Bangladesh’s potential benefits will be further reduced. The corresponding US revenue loss will fall to about 100,000 dollars, or Tk 12.3 million.
Analysis of NBR data also shows that one of Bangladesh’s major export products to the US, apart from ready-made garments, is a product category called ‘Hat and Other Headgear’. Last year, exports in this category were about 25 million dollars. If tariff benefits had been granted for this one product, Bangladesh could have benefited about 370 times more than the combined benefit of the 1,638 products.
Even before the trade agreement with the United States comes into effect, the reciprocal tariff has been declared illegal by a court. As a result, the significance of the agreement has largely diminished.Mustafizur Rahman, Distinguished Fellow, Centre for Policy Dialogue
Therefore, the overall picture is that the exports on which Bangladesh was supposed to receive benefits in the US market are very limited. As a result, if the agreement takes effect, the balance of trade benefit is likely to tilt further in favour of the United States.
After signing the agreement, at a press conference on 10 February, the former commerce adviser of the interim government had said that two major achievements had been made: the reciprocal tariff rate had fallen from 20 per cent to 19 per cent, and tariffs on ready-made garments made from US cotton would be zero. However, after the annulment of the reciprocal tariff, both of these benefits have effectively become uncertain.
The future of the trade agreement
As of Saturday, the website of the US Trade Representative (USTR) has published documents for eight ‘reciprocal trade’ agreements, and Bangladesh is one of these eight countries.
Asked about the future of the agreement in this situation, commerce secretary Mahbubur Rahman told Prothom Alo over the phone on Saturday that the bilateral trade agreement with the United States might be cancelled. The matter is not yet clear. It will be clear after 24 February what will happen.
Speaking regarding this, Mustafizur Rahman, distinguished fellow of the private research organisation Centre for Policy Dialogue (CPD), told Prothom Alo that the trade agreement with the United States had already lost much of its significance since the reciprocal tariff was declared illegal before the agreement took effect. However, if the United States wishes, it could impose additional country-specific or product-specific tariffs, which Bangladesh must monitor carefully.