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The economy of Bangladesh is increasingly trade-dependent. Foreign trade, a combination of merchandise export and import, accounts for 41 per cent of the country's Gross Domestic Product (GDP). So, regular review of trade policy is critical. Though it is the government entrusted with the task, the private sector has a vital role in facilitating the process.
Trade policy is a set of rules and regulations aimed to facilitating trade in a host of ways as well as setting goals, directives and standards. Due to increase in trade integration among countries, some forms of common trade policies are also available these days.
A joint move by some trade bodies and think-tanks in this regard may be worth mentioning. Bangladesh Enterprise Institute (BEI) has taken such an initiative. It is now working to design the 'Trade Policy Advocacy Agenda 2018.' CIS-Bangladesh Chamber of Commerce and Industry, International Business Forum of Bangladesh (IBFB), Bangladesh Chamber of Industries (BCI) and Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA) have also joined the initiative.
The main objective of the advocacy is to sensitise the country's policymakers and businesses on some important areas of domestic and international trade. Sensitising the policymakers will be helpful to redesign or update the overall trade policy in line with the upcoming challenges. The proposed trade policy advocacy agenda will also call for policy reforms and streamlining supply and demand side of trade and economic policy frameworks on some critical issues.
Any policy advocacy encompasses a series of activities that influence policy making in favour of a particular party or agenda or a set of agendas. Five thematic papers are now underway to design the trade policy advocacy agenda. In fact, these papers will be considered as broader agendas for the advocacy. The themes are: (a) Overseas Investment Modalities for Bangladesh; (b) Predictable and Sustainable Tax and Tariff Policy (Customs Duty, Value Added Tax, Income Tax and others); (c) Integrated Import and Export Policy; (d) Foreign Trade Strategies 2018 & beyond: Options for Bangladesh; and (e) Bangladesh and Global Registration of Intellectual Property Rights (IPRs).
Initial drafts of the foreign trade strategies and global registration of IPR have already been prepared. Moreover, a 'Draft Import and Export Act 2018' to replace the existing Act of 1950 is now also ready for discussion.
Reviewing the drafts of the three papers, it appears that the advocacy group wanted to bring a wide range of issues in the trade policy. Due to increasing complexity in the global trade, such a move is not unwanted at all.
The main focus of the foreign trade strategy paper is to provide a direction to strike bilateral and regional free trade agreements. It argues that Bangladesh has very limited option to strike free trade agreements with most potential trading partners. In this connection, the advocacy paper suggested to form a national free trade agreement committee headed by the commerce secretary and including private sectors, think tanks, line ministries and agencies including tax authorities. It also suggested that the committee should formulate country and region-specific draft BFTAs templates. The country must not lag behind others, especially its competitors in the global race of growing bilateral and regional trade relationships in all strategic combinations.
So far, Bangladesh has not signed any bilateral free trade agreement with any of its trading partners although a series of initiatives have been taken. An FTA Policy Guidelines 2010 was also prepared by Bangladesh Tariff Commission which got approval from the Prime Minister Office in 2012. Last year, it was announced that the country's maiden BFTA would be signed with Sri Lanka. Little progress has been made so far. Discussions on signing BFTA with Malaysia, Turkey, Bhutan, Nigeria, Mali, Macedonia, Myanmar and Mauritius are also there.
Small trading partners are mainly in consideration for singing BFTAs. The underlying reason is that the country's policymakers and businesses are not comfortable with bigger partners for fear of the lack of level playing field. There is always an apprehension that BFTA with India and China will open floodgates of imports while the country's export will not take off significantly.
Against the backdrop, the suggestion put in the BEI paper seems over-ambitious. It advocates for FTAs with the United States of America (USA), European Union (EU) and Russia-CIS block; joining the Association of Southeast Asia Nations (ASEAN) and Regional Comprehensive Economic Partnership (RCEP); and forming BRICS-BIMSTEC comprehensive economic partnership.
The paper on the global registration of IPRs categorically suggests that Bangladesh should immediately join the three international treaties on patent, trademarks and industrial design. These treaties are: Patent Cooperation Treaty (PCT), Madrid Agreement on Trade Marks (Madrid system) and Hague Agreement on Industrial Designs (Hague system). Without singing these agreements, it is complicated and expensive to file any international patent or trademarks application from Bangladesh. Two years ago, the Federation of Bangladesh Chamber of Commerce and Industry (FBCCI) also urged the government to sign the agreements.
BEI also advocated for a single dedicated specialised entity under the Prime Minister's Office (PMO) which should be headed by a senior secretary of the government to strengthen, streamline and ensure most effective functional efficiency IPR regime in the country. The Department of Patents, Designs & Trademarks (DPDT) under the Ministry of Industry is currently serving as the country's IP office which oversees the industrial IPRs along with Geographic Indication (GI). Copyright office is functioning under the cultural ministry to oversee the legal protection of the creative works like literature and music.
Bangladesh's global ranking in filing patent and industrial design improved but that of trademarks declined in 2016, and there was no international filing for patent, trademarks or design from the country. BEI suggestions are reasonable as global trade regime is gradually giving importance of intellectual property rights.
Finally, the draft of the Import and Export (Facilitation and Regulation) Act-2018 is interesting. It is designed as a representation of a new Act to replace the Imports and Exports (Control) Act, 1950.
The argument in favour of replacing the Act of 1950 is that it is no more relevant to the fast-changing global and local trade scenario. Instead of dealing with exports and imports, the actual responsibility of the state is to facilitate businesses with updated regulations.
There is scope to improve the drafts. Country's businesses and experts should come up with their suggestions. Consultation or dialogue may be arranged to get feedbacks on the documents. These, hopefully, will make trade policy advocacy effective in the long run.