Trade policy
is not a static phenomenon. In Bangladesh, the trade policy regime has evolved
over the five decades since independence. The first two decades were lost
decades as trade policy simply reflected a legacy of the past inward-looking
import-substituting policy of pre-independent Bangladesh. Radical changes in
trade policy and market orientation occurred during the 1990s, earning
Bangladesh the moniker of “globaliser”. But liberalising policies soon gave way
to resurgence of protection through high tariffs and para-tariffs. Trade policy
dualism emerged with readymade garment (RMG) exports accorded a free trade
channel while non-RMG exports operated under a highly restrictive and
protectionist trade regime, which characterises the current state of trade
policy. Given the evolving landscape of international trade, geopolitical
fragmentation, creeping deglobalisation, and rising populism have been shaping
global trade for nearly a decade. These could present potential challenges as
well as some opportunities for Bangladesh’s future growth trajectory. As
China+1 geopolynomics takes hold as a de-risking alternative to China-sourcing,
our RMG industry is well placed to absorb part of the redirected additional
demand given its wage competitiveness, underutilised production capacities, and
capable swift-footed first-generation entrepreneurs.
Keywords
Import
Substitution, Export-led Growth, Policy Dualism, Deglobalisation
JEL Classification Code
F13,
F14, F31
Recommended Citation
Sattar, Z. (2022). Bangladesh trade policy: Evolution, current state, future directions. Bangladesh Development Studies, 45(3/4). 13-33.