Bangladesh has offered duty benefit on import of 602 products from five countries under Asia Pacific Trade Agreement (APTA).
APTA member countries - India, China, Lao PDR (Laos), Republic of Korea (South Korea) and Sri Lanka - will enjoy concessional rates of Customs Duty (CD) ranging from 10 per cent to 70 per cent.
Mainly imported products, including intermediate goods, basic raw materials, capital goods and machinery, and industrial parts, will enjoy the concessional duty benefit.
Bangladesh for the first time offered the duty benefit for the APTA member countries as per the agreement, said a senior customs official.
The National Board of Revenue (NBR) Customs Wing issued a Statutory Regulatory Order (SRO), dated September 18, 2018, in this regard.
The SRO has been issued with a retrospective effect from July 1, 2018.
APTA is the oldest preferential trade agreement among the Asia-Pacific countries, based on the Bangkok Agreement, signed in 1975.
Although APTA came into effect from November 1, 2005, the volume of trade under the deal is not yet significant.
Experts, however, said the duty benefit will bring some negative impact on revenue mobilisation of the government, as major importing countries like India and China will enjoy the concessional duty.
A customs official also said a number of vital products, including capital machinery, will enjoy concessional CD facility under the SRO.
"Four of the member countries of APTA, except Bangladesh, earlier offered CD benefit on imported products as per agreement," he added.
Six-member APTA platform cumulatively offered duty concessions on around 11,000 products to each other as per decision of the fourth round of negotiations of the forum, held in January 2017.
Talking to the FE on Monday, Chairman of Policy Research Institute (PRI) Dr Zaidi Sattar said the duty benefit will boost anti-export bias and increase level of protection for the import substitute industries.
"Consumers will not get the benefit of the concessional duty. There is no consumer product in the SRO."
China and India constitute for around 50 per cent of annual import of Bangladesh. The benefit will affect the government's revenue earning to some extent, he also said.
Out of its total US$ 51.50 billion import, Bangladesh brought goods worth around $ 16 billion from China and Hong Kong and $ 9.0 billion from India in last fiscal year (FY), 2017-18.
Of the 602 products under concessional duty, 598 products are for all member countries. Laos, as a least developed country, will enjoy additional benefit for the remaining four products.
However, customs officials said local exporters will also enjoy duty concession on products offered by other countries under APTA.
On July 2, India announced that it will provide tariff concession on 3,142 products to the APTA member states including Bangladesh.
Also, China in general slashed duty on 2,191 products, South Korea on 2,797, Sri Lanka on 598 and Laos on 999 products.
Besides, India waived tariff on 48 products, China on 181 products, and Sri Lanka on 75 products for both Bangladesh and Laos.
Meanwhile, South Korea has cut duty up to 100 per cent on 951 products for Bangladesh.
[email protected]
