"We were shocked when we were told yesterday that some Bangladeshis were involved in some recent incidents, including that in [Varanasi] and some other places," Bangladesh Finance Minister M Saifur Rahman told reporters here in response to a question from an Indian journalist about India's concern over terrorism "emanating" from Bangladesh.

Terming the impression about Bangladesh harbouring terrorists or Indian insurgents "erroneous", Saifur told the Indian journalists, "As long as you have this erroneous impression, relations between the two countries cannot improve."

"Bangladesh does not believe in terrorism. Terrorists are nobody's friends. In the name of religion, there should be no terrorism," Saifur said.

He claimed that the economic situation in Bangladesh is "much better" in certain respects than in India and that it is "much better managed".

Bangladesh has controlled terrorism "much more effectively", said the finance minister, pointing to the recent arrest of top two Jama'atul Mujahideen Bangladesh (JMB) leaders Abdur Rahman and Siddiqul Islam alias Bangla Bhai.

Saifur said the visit of Prime Minister Khaleda Zia to India is rewarding from the point of view of pushing forward economic relations.

He said the economic content of the ties is going to play a catalytic role in shaping bilateral ties between the two countries.