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Bangladesh Trade with India: Trends and Patterns

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  • Anisul M. Islam

Abstract

Bangladesh has a large and persistent trade deficit with its neighboring country India over the years. This paper explored the trends and patterns of trade between these two countries using both aggregated and disaggregated data. More specifically, it examined the relative position of the two countries in global trade, explores the overall trend in exports to and imports from India, and the trend in trade balance using aggregate level data. Further, utilizing some disaggregated data, analysis is conducted regarding the commodity composition of Bangladesh exports to and imports from India by major product categories. Additionally, the paper estimates revealed comparative advantage (RCA) to reflect inter-industry trade based on comparative advantage by HS-2 digit commodity groups. The paper finds that India has a much stronger position in the global trade vis-Ã -vis Bangladesh and that India strongly dominates Bangladesh in bilateral trade, resulting in a very large and persistent trade deficit with India. At a disaggregated level, the paper finds that Bangladesh has comparative advantage in some products whereas India has comparative advantage relatively in more product categories.

Suggested Citation

  • Anisul M. Islam, 2019. "Bangladesh Trade with India: Trends and Patterns," Athens Journal of Business & Economics, Athens Institute for Education and Research (ATINER), vol. 5(2), pages 123-140, April.
    • Handle: RePEc:ate:journl:ajbev5i2-2
    DOI: 10.30958/ajbe.5-2-2
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    References listed on IDEAS

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    1. Mustafizur Rahman & Towfiqul Islam Khan & Ashiqun Nabi & Tapas Kumar Paul, 2010. "Bangladesh's Export Opportunities in the Indian Market: Addressing Barriers and Strategies for Future," CPD Working Paper 90, Centre for Policy Dialogue (CPD).
    2. Sudhakar K. Chaudhari, 1995. "Cross border trade between India & Bangladesh," NCAER Working Papers 58, National Council of Applied Economic Research.
    3. Garry Pursell, 2007. "Smuggling and the Economic Welfare Consequences of an FTA: A Case Study of India-Bangladesh Trade in Sugar," ASARC Working Papers 2007-05, The Australian National University, Australia South Asia Research Centre.
    4. Rahman, Mohammad Mafizur, 2005. "Bangladesh-India Bilateral Trade: Causes of Imbalance and Measures for Improvement," Working Papers 1, University of Sydney, School of Economics.
    5. Sanjib Pohit & Nisha Taneja, 2003. "India's Informal Trade with Bangladesh: A Qualitative Assessment," The World Economy, Wiley Blackwell, vol. 26(8), pages 1187-1214, August.
    6. De, Prabir & Raihan, Selim & Kathuria, Sanjay, 2012. "Unlocking Bangladesh-India trade : emerging potential and the way forward," Policy Research Working Paper Series 6155, The World Bank.
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    Cited by:

    1. Mohammad Razaul Karim, 2020. "Bangladesh-India relations: Honeymoon period returned?," Journal of Advances in Humanities and Social Sciences, Dr. Yi-Hsing Hsieh, vol. 6(5), pages 171-182.

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