Cabinet approves draft transit deal with Bhutan

The cabinet on Monday gave in-principle approval to a draft transit deal with Bhutan, under which, the neighbouring country will be able to use Bangladesh’s ports and roads to transport goods.

Besides, the deal, awaiting to be finalised after signing, will also allow Bangladesh to transport goods to Bhutan via India.

This draft was approved in the weekly meeting of the cabinet chaired by Prime Minister Sheikh Hasina.

“Bhutan is a landlocked country. They have no river or sea ports of their own for import and export. They get transit facilities from India. Now they are going to get the opportunity to use the land and port of Bangladesh,” Cabinet Secretary Mahbub Hossain told the media after the meeting.

He said the draft agreement will now be sent to the National Board of Revenue (NBR) to determine the fee or revenue for Bhutanese vehicles for transit through Bangladesh. The deal will be signed after finalising everything.

Currently, Bangladesh has a transit agreement with India, allowing the neighbouring country to use Bangladesh’s ports and roads.

Meanwhile, Bangladesh has a Preferential Trade Agreement (PTA) with Bhutan. Traders believe that the PTA, signed in 2020, will be more effective if the transit deal is signed. Transit and protocol agreements are necessary for easy movement of goods between the two countries.

Under the PTA, which is the first for Bangladesh, 100 products of Bangladesh will get duty free facility in Bhutan and 34 products of Bhutan will get duty free facility in Bangladesh.

Bangladesh imports vegetables, fruits, minerals, construction materials, boulder stones, limestone, coal, pulp, and chemicals from Bhutan. On the other hand, it exports clothes, furniture, food items, medicine, plastic, and electrical products to the neighbouring country.

Meanwhile, India offered Bangladesh free-of-charge transportation of goods to any third country using its ports during Prime Minister Sheikh Hasina’s visit to the country. If the proposal is implemented, Bangladesh will get some additional benefits in transporting goods mainly to Nepal and Bhutan. Cargo trucks from Bangladesh can go to Nepal and Bhutan via India.

A secretary level meeting between Bangladesh and India was held immediately after India made the proposal, where the issue of signing a transit agreement between the two countries was given priority.