US-Bangladesh trade deal explained: Dhaka opens farm gates wide – who wins big, who takes the hit | World News

New Delhi: The new trade agreement between the USA and Bangladesh attracted attention in South Asia. The agreement gave American agricultural products greater access to the Bangladeshi market. India adopted a more protectionist approach in its talks with Washington. Bangladesh, on the other hand, has opened access to many agricultural and food sectors.

The reciprocal trade arrangement allows American agricultural products to enter Bangladesh more easily. The product list is extensive. Contains dairy products, beef, poultry, soy-based products, tree nuts and fresh fruits. Industrial exports from the United States also provide a smoother entry. Part of the package consists of chemicals, medical equipment, machinery, automobile components, ICT devices and energy products.

In return, Washington agreed to reduce customs duties on Bangladesh’s exports. Taxes, which previously reached 37 percent, will drop to around 19 percent. Selected product groups may face zero tax over time.

The White House described the agreement as a step toward stronger economic ties. The deal carries obligations beyond tariffs, as trade analysts in Dhaka examine the deal’s domestic impact. Bangladesh will remove many non-tariff barriers that once regulated agricultural imports. American certification systems will be officially recognized.

US sanitary and phytosanitary standards will be accepted in Bangladeshi markets. Food safety permits issued by US agencies will be valid for entry.

The agreement also includes geographical indication provisions. These rules will allow American cheese and meat producers to use widely recognized product names. Therefore, market branding protections for US exporters will remain intact in Bangladesh.

Import commitments are at the heart of the deal’s scale. Bangladesh is expected to purchase approximately $3.5 billion worth of American agricultural products. At the top of the list are wheat, soybeans, cotton and corn. The agribusiness segment is accompanied by energy purchase agreements worth approximately $15 billion. Civil aviation procurement and cooperation measures appear within the broader commercial structure.

Agriculture has a great economic weight in Bangladesh. As per 2023-24 estimates, farming here contributes roughly 11.19 per cent to the national GDP. Rural livelihoods largely depend on crop cycles and livestock activities. Close to 38 percent of the population relies on agriculture for income and daily living.

Livestock economy is another important pillar. Dairy, meat and poultry production together contribute about 1.9 percent to GDP. Direct employment from livestock supports approximately 20 percent of the population. Indirect links extend to almost half the country through supply chains, feed markets, transportation and retail networks.

The latest livestock census figures show the size of the sector. Bangladesh was home to more than 430 million animals and birds in 2021-22. This number includes approximately 56.7 million cattle, buffalos, sheep and goats. The number of poultry exceeded 375 million. Milk production reached approximately 13 million metric tons. Meat production reached approximately 9.3 million metric tons and egg production exceeded 23 billion units.

The domestic dairy market is worth approximately $3 billion. Bangladesh produces approximately 14 million tonnes of milk every year. Imports help meet remaining demand. The country purchases approximately 311,000 metric tons of dairy products from abroad annually.

Economists view the new trade expansion through the lens of price competition. American agriculture operates on a large industrial scale. Federal subsidy support reduces production costs. Dairy products, beef and poultry from the United States often reach export markets at discounted prices. Large shipment volumes reinforce this price advantage.

Bangladeshi small farmers operate on tighter margins. Family farms dominate the dairy and poultry supply. Feed costs, land constraints and access to credit affect working environments. The increase in cheap imports could harm market shares. Income pressure may extend to rural areas that depend on livestock earnings.

Import data already points to increased exposure. Bangladesh purchased dairy products worth approximately $519 million in 2024. During this period, local producers faced price pressure. Industry experts estimate that domestic meat and dairy production could decline by up to 4 percent if import volumes increase.

Food regulation also enters the policy debate. The agreement allows the entry of genetically modified and biotechnological food products under US certification. Local testing requirements may be relaxed in certain categories. Public health experts and environmental researchers are studying the long-term consequences in terms of consumption safety and ecological balance.

Consumer demand adds another layer to the story. Bangladesh’s middle class now exceeds 30 million. Urban households are looking for higher quality protein, packaged dairy products and processed food products. Imported goods can meet this increasing appetite. Retail chains and cold storage networks are preparing for diversified product supply.

Bangladesh’s global trade position is also set to change. The country is classified as a Least Developed Country (LDC). This status gives it special export advantages in major markets. Lower tariffs, easier trade rules and broader market access have helped the apparel industry grow.

The sector employs millions of workers and supports foreign exchange earnings. LDC’s graduation is planned for around 2026. Preferential tariff advantages will be phased out over time. Export costs for textiles and manufactured goods may increase after the concessions are eliminated.

Economists are studying how these changes will affect the country’s economy overall. The benefits of exports may decrease, while imports may increase. This could put pressure on domestic agricultural and livestock sectors, forcing them to adapt. Policymakers will closely monitor rural employment and price stability to understand the real impact.

The agreement goes beyond transporting goods. It also covers digital commerce. Companies will be able to transfer data more freely across borders. Customs systems will move to faster online processing, reducing delays. Insurance rules will also change and it will become easier for foreign companies to enter the market and operate locally.

The broader trade plan is designed to increase American exports to Bangladesh’s consumer and industrial markets. How dependent Bangladesh is on imported agricultural products will decide how strong and self-sufficient it will be in the long run. If food imports increase significantly, the government may have less freedom to plan food security policies.

For now, the agreement marks a major change in the way Bangladesh handles trade. Markets are opening in agriculture, food products and industrial products. The real impact of this will be seen in the coming years as local producers try to adapt to this more open market.