Bangladesh set to join the China-led international trade bloc, RCEP, Regional Comprehensive and Economic Partnership, to navigate the changing international trade across the globe.
During the proposed visit of Prime Minister Sheikh Hasina to China in July, a memorandum of understanding is likely to be sign in this regard, however, the Ministry of Commerce has started work on it, according to sources.
Earlier, the Ministry of Commerce has forwarded a recommendation to join RCEP to the Foreign Ministry before January 7 election, former Foreign Minister AK Abdul Momen told the media that time that a final decision will be made post January elections.
RCEP stands out as the worlds largest Free Trade Area (FTA), encompassing the 10 ASEAN nations and five FTA partners, including China, Japan, South Korea, Australia, and New Zealand.
RCEP currently represents 30 per cent of global GDP and aims to eliminate a significant portion of tariffs on goods traded within the bloc over the next two decades.
"However, there are concerns in India that the entry of neighboring countries like Bangladesh into RCEP could lead to heightened competition with China and other RCEP members, possibly affecting Indias trade dynamics," a senior official of the Foreign Ministry has said preferring anonymity.
Bangladesh needs to secure alternative trade arrangements with other countries as she is poised to graduate from the list of Least Developed Countries by November 2026, resulting in the loss of preferential access to global markets.
The Ministry of Commerce assessed that Bangladeshs entry into RCEP could significantly increase exports, potentially amounting to $5 billion. However, Bangladeshs contemplation of RCEP membership reflects a strategic shift that could shape its trade policies and partnerships, it said.
Bangladesh is already negotiating free trade agreements with six of the fifteen RCEP countries. Joining RCEP would simplify these processes and enhance Bangladeshs competitiveness in the global market, according to the Commerce Ministry.
The prospect of Bangladesh joining RCEP looms large as a large part of the world market, including China, will be open for the country. On the other way there will also be the potential challenge of increased competition from Chinese products here.
India, having been involved in the RCEP policy since its inception in 2011, withdrew in November 2019, citing unaddressed concerns. The Narendra Modi government felt that some of its concerns were not being taken into account in this coalition.
However, many observers believe that Chinas eagerness to assume a leading role in the formation is a primary factor behind Indias withdrawal from the alliance. With discussions ongoing with at least 11 countries, Bangladesh aims to navigate the changing international trade landscape but there are many other geopolitical issue that determined the fate of joining Bangladesh in the China-led international trade bloc, official said.
