Bangladesh expects the ongoing joint study on Economic Partnership Agreement (EPA) with Japan to be completed within days and the two sides are sitting in Dhaka next week for stocktaking, sources said.
A team of Japan's Ministry of Economy, Trade and Industry (METI), headed by its minister, Nishimura Yasutoshi, is due in Dhaka next week for discussions to this effect, as Dhaka accelerates preparation for LDC graduation.
Mr Yasutoshi is likely to have a bilateral meeting with Commerce Minister Tipu Munshi, discussing the nitty-gritty of the deal in the process of making.
Officials have said there are 17 components of the joint feasibility study of which six were completed in the first meeting of the joint study group (JSC) held in Tokyo in April this year.
The next meeting of the JSC aims to complete the study and submit the findings to the high-ups of the respective countries "as soon as possible", said a trade official in Dhaka familiar with the arrangement.
He said Japan was found "very much supportive" in this case and "we expect to start the EPA negotiations within this year".
"Our target is to conclude the EPA by 2025," said the official, adding that two years are enough to complete negotiations.
He feels that Bangladesh needs to conclude some more free-trade agreements (FTAs) before graduating from the group of least-developed countries (LDCs) in November 2026.
The FTA Wing of the Ministry of Commerce in a recent meeting emphasised the need for taking forward the ongoing activities relating to the signing of FTA and other types of economic-partnership agreements with countries and blocs.
Bangladeshi products presently enjoy duty-and quota-free market access in Japan as the country is still in the LDC group. In the fiscal year 2021-22 Bangladesh's export to Japan increased to $1.35 billion from $1.18 billion in the previous year.
On the other hand, in FY 2020-2021 Bangladesh's imports from Japan cost $2.02 billion.
However, unless an FTA or EPA is signed with Japan, Bangladesh's products will lose the duty-and quota-free access to the Japanese market when Bangladesh will leave the world's poor-country club in 2026.
As such, Dhaka is eager to sign a FTA or EPA with Tokyo, officials said.
Bangladesh Trade and Tariff Commission (BTTC) had earlier studied the pros and cons of signing an FTA deal with Japan which found that Bangladesh would be immensely benefited in the post-LDC era if such an agreement is inked.
Also, the Japan-Bangladesh Chamber of Commerce and Industry (JBCCI) in 2021 conducted a survey on 300 companies, local firms, and Japanese companies operating in Bangladesh, and found majority of them expecting that the two nations should strike such a deal.
Japan's former ambassador to Bangladesh Ito Naoki last year in Dhaka hoped that bilateral trade between the two countries could reach $20 billion by 2030 from the present paltry volume of over $3.0 billion since garment export to the developed East Asian country is growing fast.
He had said most of the companies conducting trade between the two countries wanted that the two nations sign an FTA to retain duty privileges after Bangladesh graduates from the LDC group.
Country representative of Japan External Trade Organisation (JETRO) Yuji Ando earlier told the FE some Japanese companies felt the need for an FTA or extension of the existing generalised system of preference (GSP) facility.
"If the tariff-free access to Japan is not available, relocation (of factories) from Bangladesh might take place to other countries having trade agreements (with Tokyo), like Vietnam, ASEAN, and India," he said in reply to an e-mail query.
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