Bangladesh and the United States have agreed to finalize a new Agreement on Reciprocal Trade aimed at strengthening bilateral economic ties and expanding market access for exporters in both countries.

The Agreement, announced on Monday, February 9, builds upon the longstanding economic partnership between the two nations, including the U.S.-Bangladesh Trade and Investment Cooperation Forum Agreement (TICFA) signed in 2013. Once finalized and implemented through respective domestic procedures, the new framework is expected to significantly enhance trade flows and investment cooperation.

Under the Agreement, Bangladesh will provide significant preferential market access to a wide range of U.S. industrial and agricultural products. These include chemicals, medical devices, machinery, motor vehicles and parts, ICT equipment, energy products, soy products, dairy, beef, poultry and tree nuts and fruits.

In return, the U.S. will reduce the reciprocal tariff rate on Bangladeshi-origin goods to 19%, as initially set forth in Executive Order 14257 of April 2, 2025. Additionally, certain products listed under Annex III of Executive Order 14346 of September 5, 2025, will receive a zero percent (0%) reciprocal tariff rate.

A key development for Bangladesh’s export-oriented apparel sector is the establishment of a mechanism allowing a specified volume of Bangladeshi textile and apparel goods to enter the U.S. market at a zero reciprocal tariff rate. The eligible volume will be determined in relation to U.S. textile input exports, such as cotton and man-made fibers, to Bangladesh.

Bangladesh has also committed to addressing non-tariff barriers affecting trade and investment. These include accepting vehicles built to U.S. federal safety and emissions standards, recognizing U.S. Food and Drug Administration certifications for medical devices and pharmaceuticals, and removing import restrictions or licensing requirements on U.S. remanufactured goods and parts.

In the digital and regulatory sphere, Bangladesh will permit the free transfer of data across trusted borders, support a permanent WTO moratorium on customs duties on electronic transmissions, digitalize customs procedures, and adopt good regulatory practices. The country has also committed to following science- and risk-based processes for the import of safe U.S. food and agricultural goods and removing barriers in the insurance sector.

The Agreement includes significant commitments on labor rights, environmental protection, anti-corruption and intellectual property. Bangladesh will amend its labor laws to strengthen freedom of association and collective bargaining, prohibit the importation of goods produced by forced labor, and strengthen enforcement of labor laws. It also commits to high environmental standards, improved trade facilitation, stronger intellectual property enforcement, and ratification or implementation of certain international IP treaties.

Both countries emphasized enhanced cooperation on supply chain resilience, export controls, duty evasion prevention and information-sharing on inbound investment.

The Agreement also takes note of major commercial engagements, including Bangladesh’s procurement of aircraft, planned purchases of approximately $3.5 billion in U.S. agricultural products, and energy product purchases estimated at $15 billion over 15 years.

The U.S. will also consider supporting investment financing in critical sectors in Bangladesh through institutions such as the Export-Import Bank (EXIM Bank) and the U.S. International Development Finance Corporation (DFC), subject to eligibility and applicable law.

Both governments stated they will promptly finalize the Agreement and complete necessary domestic formalities before it enters into force.