The trade deal Bangladesh secured with the United States after nine months of tense, tariff-shadowed negotiations has set off a sharp national reckoning, with policymakers and business leaders divided over whether it marks a strategic gain-or a costly compromise.
The scrutiny deepened dramatically after a landmark ruling by the US Supreme Court struck down the "reciprocal tariffs" imposed by President Donald Trump on a number of countries.
Within days, however, Trump invoked a separate legal provision to impose fresh tariffs-initially 10 per cent, then 15 per cent within 24 hours-injecting new uncertainty into the future of Bangladesh's recently signed accord with Washington.
Against this volatile backdrop, Bangladesh's new government is preparing to write formally to Washington seeking clarification on the status of the Dhaka-Washington trade deal, concluded by the interim administration just days before national elections.
Commerce Secretary Mahbubur Rahman said the letter could be sent as early as Monday, following an internal meeting to assess the implications of the US court ruling.
As analysts and business representatives examine the fine print, many argue the deal appears unusually demanding for Bangladesh, with some suggesting it carries political overtones that extend beyond conventional trade diplomacy.
At a discussion organised by the Bangladesh Chamber of Commerce and Industry on 17 February-the day the new government took office-business leaders and economists urged a comprehensive review. One participant described the agreement as resembling "an imposed condition" rather than a mutually beneficial partnership.
Khondaker Golam Moazzem, Research Director at the Centre for Policy Dialogue (CPD), has argued that in light of the Supreme Court's ruling the government should consider withdrawing from the pact. As the agreement has yet to generate binding implementation obligations, he maintains that there remains room for reconsideration.
The origins of the deal lie in escalating tariff tensions. After returning to office for a second term, President Trump announced sweeping new import duties on more than 100 countries on 2 April 2025.
Bangladesh initially faced an additional 37 per cent tariff. Following negotiations, this was reduced to 20 per cent from 1 August. With an existing 15 per cent duty already in place, total tariffs on Bangladeshi exports reached 35 per cent.
After prolonged negotiations, Bangladesh secured a modest reduction in the supplementary tariff-from 20 per cent to 19 per cent-bringing the overall rate down to 34 per cent.
The interim government hailed the outcome as a major achievement, particularly for the ready-made garment (RMG) sector, which depends heavily on the US market.
Under the agreement, garments produced using a specified proportion of American cotton or synthetic yarn would see the 19 per cent supplementary tariff reduced to zero.
As the United States is the largest single destination for Bangladesh's apparel exports, the provision was presented as a game changer.
Exporters, however, say the reality is more complex. The zero-tariff benefit applies only to the supplementary component and is subject to conditions that remain ambiguous.
Manufacturers are uncertain about the required proportion of US-origin cotton and how value addition will be assessed in products incorporating materials from multiple countries. There is no clear precedent of a country obtaining duty-free US access solely on the basis of cotton sourcing.
Shams Mahmud, Managing Director of Shasha Denims and former president of the Dhaka Chamber, has raised practical concerns. If a garment contains components such as metal fastenings, embroidery or synthetic trims from various origins, will it qualify if only the cotton is American? How will labour standards be interpreted-under Bangladeshi wage structures or American expectations?
Such ambiguities, he argues, complicate supply chain planning and cost calculations.
He also warns against overdependence on a single cotton source. A poor harvest or natural disaster in the United States could disrupt supply and inflate prices, placing Bangladesh's apparel exporters in a vulnerable position.
Beyond garments, the agreement imposes significant commitments. Bangladesh has pledged to import $3.5 billion worth of US agricultural products-including wheat, soybeans and cotton-over five years, and $15 billion worth of liquefied natural gas over 15 years.
Biman Bangladesh Airlines has agreed to purchase 14 Boeing aircraft. The deal also commits Bangladesh not to impose barriers on imports of American meat, poultry, processed meat products, catfish and eggs, and to recognise the equivalence of the US dairy safety system.
A particularly contentious clause requires Bangladesh to consider US interests when determining imports from third countries, a provision critics say may constrain policy autonomy.
In exchange, around 2,500 Bangladeshi products-including pharmaceuticals, agricultural goods, plastics and timber-would receive zero-tariff access to the US market, while Bangladesh would grant duty-free access to American goods across 7,132 tariff lines.
Analysts caution that given America's scale and competitive advantage, such broad access could expose domestic industries to intense pressure. The poultry sector is already alarmed.
Khandaker Monir Ahmed of the Bangladesh Poultry Industries Association warns that domestic producers are struggling with falling farm-gate prices. If cheaper imports flood the market, farmers may abandon production, risking supply shortages and food security concerns.
For Moazzem of CPD, the agreement's scope is troubling. He argues that it extends far beyond tariffs to encompass agriculture, services, intellectual property and energy, and that it risks undermining Bangladesh's economic policy autonomy.
He questions how such a sweeping arrangement aligns with World Trade Organization norms and contends that the Supreme Court ruling weakens the legal basis on which the negotiations were conducted.
Others take a more optimistic view. Zaidi Sattar, Chairman of the Policy Research Institute, sees the agreement as a first step towards broader trade liberalisation and possibly a full free trade agreement by 2035. Bangladesh's tariff regime, significantly higher than the global average, has long been criticised for discouraging foreign investment.
As the country prepares to graduate from least-developed-country status, proponents argue that bilateral agreements with major partners may be essential to preserve export competitiveness.
