Bangladesh and the United States have signed a reciprocal trade agreement that reduces US tariffs on Bangladeshi exports to 19 percent and introduces zero-tariff access for specified textile and apparel goods made with US inputs, while Dhaka agrees to broaden market access for US industrial and agricultural products, including dairy, soy products, beef, poultry, tree nuts and fruit. The deal follows nine months of negotiations and aims to strengthen bilateral economic ties, ease trade barriers and stimulate diversified commerce.
Under the agreement, Bangladesh will offer preferential access to US exports ranging from machinery and medical devices to food and agriculture products; the United States, in turn, will cut its tariff on Bangladeshi goods and allow certain readymade garments — especially those made with US-sourced cotton and man-made fibres — to enter the US market duty-free. This zero-tariff mechanism is designed to boost Bangladesh’s garment sector, which employs millions of workers and accounts for the bulk of export earnings.
While the deal provides market opportunities for US agricultural exporters, including dairy and soy producers, it also excludes broad tariff elimination beyond specific product categories, and implementation is conditioned on mechanisms such as originating rules for textiles and phased tariff reductions over several years. Dhaka has also committed to purchasing about $3.5 billion in US agricultural goods and roughly $15 billion in energy products over the next decade and a half, reflecting broader commercial cooperation under the pact.
For Bangladesh, the agreement represents a strategic enhancement of market access to the world’s largest consumer market while pushing its farmers and processors to integrate into global value chains. For US exporters, it opens new avenues in industrial and agricultural segments previously constrained by higher tariffs. The deal’s agricultural and dairy provisions will be closely watched as they take shape in practice, particularly in how they balance import opportunities with food safety standards and local sector interests.
Implications on Indian Dairy sector
The Bangladesh–US trade deal, which opens Dhaka’s dairy and agricultural markets to American products, has clear and quiet implications for India’s dairy exports. While India is not part of this agreement, Indian exporters are likely to face higher competitive pressure, particularly in dairy ingredients such as skim milk powder, whey and specialised proteins where the US enjoys scale, technology and policy support. Any tariff or procedural advantage extended to US dairy could narrow India’s pricing edge in Bangladesh, especially during India’s flush season when export surpluses rise and margins are already under strain.
That said, India is not without structural strengths. Proximity, shorter delivery timelines, flexible shipment sizes and strong cultural alignment continue to favour Indian dairy in Bangladesh, particularly for conventional products. However, the real risk lies in the shift of demand towards value-added dairy ingredients, an area where Indian exporters still lag in scale and consistency compared to US suppliers. This development should be read as a policy signal for India to move beyond commodity exports, strengthen bilateral trade engagement with Bangladesh, and invest in export-ready dairy ingredients. The deal may not immediately disrupt India’s dairy exports, but it certainly raises the bar — making product sophistication, cost efficiency and trade diplomacy decisive for India’s dairy competitiveness in the region over the coming years.
#BangladeshUSTradeDeal #DairyImports #AgriMarketAccess #TextileTariffs #TradePolicy #GlobalAgriculture #BangladeshExports