Vol. 5 Num 680 Fri. April 28, 2006  
Front Page

Experts favour facility against package deal

Country's leading trade experts, economists and businessmen express their views in support of providing transit facilities to India.

The business leaders also suggest carving out a comprehensive package deal with India, involving all bilateral problems including water and trade deficit issues while resolving the transit issue.

According to the experts, a country cannot advance while staying isolated from the international community.

The government at a ministry-level bilateral meeting last Friday opposed an Indian proposal for transit facility raised by Indian State Minister for Commerce Jairam Ramesh.

Some business leaders, however, foresee negative impacts on local industries from the transit and favoured it in a controlled manner to earn foreign currency as royalty.

Kazi Khaliquzzaman, president of Bangladesh Economic Association (BEA), extends his support for giving India transit as "connectivity is a must for the modern one world era".

"We did not sign the Asian Highway [agreement and] we have missed some opportunity of connectivity," he says. "But the transit deal should be under a package, involving water, economy and trade issues to force more business and economic relation with the big neighbour," he adds.

Cooperation is a matter of give-and-take and one has to give something if one demands something from the other, Khaliquzzaman says.

To Mir Nasir Hossain, president of Federation of Bangladesh Chambers of Commerce and Industry (FBCC), transit is a very sensitive issue. The government should consider it carefully as such transit may create negative impact on the local industries.

"If transit is given to India, the existing business interest of Bangladesh with the northeastern states of India will be hampered. We currently export some toiletries, beverage and food items to these states. If the government approves a transit, it will make the Indian products cheaper than the Bangladeshi products [in those states]," Mir Nasir argues.

But a package deal involving all other bilateral and economical issues, including the transit, between the two countries can be considered as a tool for realising other interests of the country, he says. The government should first set a modality, linking all bilateral problems under the deal before going for a transit facility, he adds.

The Indian proposal is not a transit facility; it is a "corridor facility" which is internationally discouraged, Mir Nasir opines. A transit means connecting two countries through a third country, but India is proposing a link from one of its states to another via Bangladesh, he explains.

Latifur Rahman, president of Metropolitan Chamber of Commerce and Industry (MCCI), says Bangladesh has to first ensure preferential or duty-free access of its products to India to narrow down the existing trade deficit before opening a discussion on the transit issue.

"The subject can be discussed in a comprehensive manner together with the entire gamut of trade relations to come to a mutual solution," Latifur says.

According to Tipu Munshi, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), transit should not be a problem between two neighbouring countries and Bangladesh can open a transit for India through discussion.

Bangladesh can also discuss with Nepal and other South Asian countries for connecting each other through transit facility. But the government should weigh its own interest before allowing a transit, he says.

MA Momen, president of Dhaka Chamber of Commerce and Industry (DCCI), says the country should maintain more caution in allowing India a transit as Bangladesh is yet to build necessary capacity to handle it.

Such transit can be approved if India includes all bilateral problems under a single package deal, he says.

"When the South Asian nations phase out tariff from their chosen products transit facilities should naturally follow to make the South Asian Free Trade Agreement (Safta) fruitful," he adds.

Allowing a transit must help increase bilateral trade and the economy will be vibrant with the enhanced export-import activities between the two countries, he says.