With an aim to boost bilateral trade, Bangladesh has offered to establish two Special Economic Zones for Indian companies besides allowing Life Insurance Corporation to start operations in the country.
After Prime Minister Narendra Modi’s talks with his counterpart Sheikh Hasina yesterday, both sides signed a number of pacts to spur economic engagement and enhance connectivity so that North East region could be linked to South Asian countries.
As per the MoU on the economic zone, Bangladesh will offer SEZs to Indian companies in Mongla and Bheramara.
India becomes the third country after Japan and China to have shown interest in developing economic zones in Bangladesh, media reports here said.
India will develop the economic zone near the government-sponsored one in Mongla, which is now under construction, Paban Chowdhury, executive chairman of Bangladesh Economic Zones Authority, told The Daily Star.
India wants over 200 acres of land in Mongla and 477 acres at Bheramara to establish the zones, he said.
The zones will be developed with funds obtained from the USD 2 billion line of credit from India, the BEZA executive chairman said.
“As there will be no uncertainty regarding funds, we expect the zones can be developed in three years,” Chowdhury said.
Both the sides also renewed a Bilateral Trade Agreement and signed another one on Coastal Shipping which will allow direct and regular movements of Indian ships to Bangladeshi ports.
Foreign Secretary S Jaishankar said the pact will help movement of goods and encourage the shipping industry of Bangladesh.
Opening its insurance sector, Bangladesh handed over consent letter by Insurance Development and Regulatory Authority (IDRA) to Life Insurance Corporation (LIC) to start operations in the country.
The annual trade between Bangladesh is around USD 6.5 billion out of which India’s export is around USD 6 billion while Bangladesh exports to India is around USD 0.5 billion.
Modi, after holding talks with Hasina yesterday, promised to do “everything” to address the trade deficit.
To improve connectivity, an MoU was signed on Blue Economy and Maritime Cooperation in the Bay of Bengal and the Indian Ocean.
A separate MoU was also inked on use of Chittagong and Mongla Ports by Indian ships to ensure better movement of goods.
An agreement was inked between Bangladesh Standards and Testing Institution (BSTI) and Bureau of Indian Standards (BIS) on cooperation in the field of standardisation.