India, Bangladesh to move towards economic integration


Dhaka : India and Bangladesh are set to sign a memorandum of understanding (MoU) next week to begin the process of removing non tariff barriers, part of the move towards South Asia's economic integration.

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The two neighbours will also resume secretary level dialogue after a two-year hiatus when Indian Foreign Secretary Shivshankar Menon arrives here Sunday on a three-day trip.

Although both sides had agreed to hold secretary-level talks annually, flagging Dhaka-New Delhi relations turned the meetings into a biennial affair, held in Dhaka in 2003 and in New Delhi in 2005.

In April, Foreign Adviser Iftekhar Ahmed Chowdhury promised regular secretary-level talks as part of a "new upward trajectory" in Bangladesh-India relations following the 14th Summit of the South Asian Association for Regional Cooperation (SAARC) in New Delhi, The Daily Star said Friday.

Following the talks this week, a MoU between Bangladesh Standards and Testing Institutions (BSTI) and the Bureau of Indian Standards (BIS), is likely to be signed.

According to the MoU provisions, BSTI and BIS would standardise quality controls to allow the BSTI to perform tests and certify Bangladeshi goods for export to India.

These are the first steps to remove non-tariff barriers, long demanded by Bangladesh to expand its market in India, and especially stressed by Chowdhury during informal bilateral talks in April.

The MoU would end practices such as the system of testing Bangladeshi export goods by the BIS.

Bangladesh has also demanded the removal of para-tariff barriers, which raises the price of Bangladeshi exports in India due to Indian customs surcharges, additional charges, internal taxes and charges levied on imports, and decreed customs valuation.

The secretary-level talks, including Menon's call on foreign adviser Chowdhury are also expected to re-energise deals on joint-border patrolling and border demarcation issues between Dhaka and New Delhi.

Acting Foreign Secretary Touhid Hossain will lead the Bangladeshi delegation at the official talks.

The official talks are expected to bring up the two multibillion dollar investment proposals from two Indian business giants, Mittal and Tata, that have been put on hold by the present government, the newspaper said.

High-level Bangladeshi government sources, however, say the government does not plan on taking decisions on Tata and Mittal investment plans. It wants an elected government to take the decision.

While Indian and Bangladeshi ministers have been exchanging visits and former Prime Minister Khaleda Zia visited New Delhi in March last year, relations between the two countries remained strained during 2001-06.

This was largely because of problems on the 4,700 km border, illegal migration of Bangladeshis in search of jobs and rise of religious militancy that drove Bangladeshi minorities out of the country and impacted social and demographic scene on the Indian side.