Bangladesh has offered two packages of concessionary duty benefits for the D-8 and some OIC countries to facilitate trade with the blocs.
After the South Asian Free Trade Area (SAFTA) packages, the country has offered such preferential duty-packages for the first time to import around 830 products from those countries.
Under the SAFTA, which came into force in 2006, around 5,300 products enjoy duty benefits on import within the region.
The Ministry of Commerce officials said the SAFTA benefit played a significant role in boosting Indo-Bangla trade.
The National Board of Revenue (NBR) issued lists of two concessionary duty packages through separate Statutory Regulatory Orders (SROs), effective from July 20.
As per the SRO, signed by NBR Chairman Abu Hena Md Rahmatul Muneem, the D-8 countries would enjoy concessionary duty benefits on export of 356 products.
Besides, the TPS-OIC ratified member countries would enjoy concessionary duty benefit in exporting some 478 products. Trade Preferential System among the Member States of the OIC (TPS-OIC) was signed to foster intra-OIC trade.
NBR issued the gazette following a recent consensus of the D-8 members to execute Preferential Trade Agreement (PTA) by next year. The PTA of the D-8 countries came into effect on August 25, 2011, but it is yet to be executed.
The D-8, comprising of Bangladesh, Egypt, Indonesia, Iran, Malaysia, Nigeria, Pakistan, and Turkiye, was formed to work for development cooperation.
The TPS-OIC participating states, including Cameroon, Egypt, Jordan, Malaysia, Pakistan, Syria, Tunisia, Turkiye and the UAE, would be entitled for the concessionary duty benefit.
A senior customs official said the baseline of the tariff adjustment for the OIC and the D-8 countries was set in the period when negotiation had started.
As per the SRO, import duty has been lowered for the OIC countries from 22.50 per cent to up to 5.0 per cent. For the D-8 countries, import duty rate has been slashed by 5.0 per cent.
Besides, base-year for the D-8 concessional duty-benefit has been set 2007-08, while it has been set 2003-04 for the OIC countries.
The customs officials said the import duty rates were high earlier. But Bangladesh gradually reduced import duties of many products to facilitate trade.
However, recently the customs authority has imposed heavy duty on import of some less important products to save foreign currency.
"The country is unlikely to incur any significant loss of import revenue due to offering these two packages, as those listed products are already enjoying lower duty rates," said a senior customs official.
Only 35 to 40 products had seen a significant import duty cut, he added, citing an analysis.
Recently, 20th session of the council of ministers of the D-8 Organisation for Economic Cooperation was held in the city. In the programme, Prime Minister Sheikh Hasina eyed a robust D-8 Economic Zone with investment of the member countries in Bangladesh.
The customs official further said all the D-8 member countries, except Pakistan and Egypt, offered concessional duty-benefit.
To enhance trade between the OIC countries, the framework agreement on TPS-OIC was signed and ratified by Bangladesh, he added.
As per Article-3, clause (1) and Article-5, clause (1) and (2) of the agreement, the Customs Wing formulated the concession list.
Under the agreement, Bangladesh signed Protocol on the Preferential Tariff Scheme for TPS-OIC (PRETAS). The country also sent and approved concession list of products as per rules of origin (RoO) of the TPS-OIC.
The member countries would enjoy the concessionary duty benefit for the products produced and processed in their countries.
However, the customs department has tagged some conditions as per RoO to avail the benefit. Importers have to apply in the prescribed formats of customs for certificate of origin, verification and declaration of goods - for availing the concessionary duty benefit.
Economist Dr MA Razzaque, Chairman of RAPID, said the concessionary duty package is a stepping stone for Bangladesh although there is no significant trade with those countries at present.
He said the government has cut the duty rate marginally, so the country might not lose any large amount of revenue.
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