DHAKA, Aug 30, 2025 (BSS) - The imposition of 50 percent US tariffs on Indian exports would shift export orders to Bangladesh through which the country can boost its exports by billions if the local entrepreneurs and exporters can properly seize the opportunities, believe experts comprising economists and business leaders.

On July 31, when the US administration imposed reciprocal tariff of 19 percent on goods from Cambodia and Indonesia and 20 percent on Bangladeshi products, it slapped a 25 percent duty on Indian goods.

As a "penalty" for purchasing crude oil from Russia, US President Donald Trump also announced an additional 25 per cent duty on Indian products.

This will raise the total reciprocal duty on Indian goods entering the US market to 50 percent. 

As a result of the higher tariffs on Indian products, Bangladesh now has an opportunity to increase exports of certain goods, said economists and industry leaders.

They said with the higher tariffs taking effect, Indian exporters will lose competitiveness in several categories, including ready-made garments, home textiles, processed agricultural foods, leather goods, frozen fish and shrimp, and furniture.

These are among Bangladesh's top export items. Consequently, Bangladeshi exporters may receive US orders that shift away from India.

Talking to BSS, Dr Zahid Hussain, former Lead Economist of the World Bank's Dhaka office, said that the imposition of 50 percent tariff on Indian goods to US market would heavily impact Indian exportable items like RMG, footwear and other items.

"There will be a diversion of exports to other countries. On the whole, the impact will be diversion of exports from India to other countries like Bangladesh, Vietnam, China and Myanmar where Bangladesh will remain in the first row," he said.

The renowned economist opined that Bangladesh could boost its exports to the USA by another $2 billion to $3 billion if all the concerned stakeholders here could properly seize the opportunities.

"Here the issue is whether we can tap the potentials ...capacity of the concerned stakeholders and uninterrupted supply of energy also matter here," he said.

Dr Zahid, also a member of the committee to prepare White Paper on the State of the Bangladesh Economy, said the lowering down of US reciprocal tariff to 20 percent on Bangladesh has pushed the country in such an advantageous position while any change in this tariff structure is unlikely to happen over the next six months.

He said although there are some uncertainties, yet there is a need to transform these uncertainties into opportunities while the government and all the concerned stakeholders should seize these opportunities.

"We've certain capacities as the previously closed down factories are being reopened hoping that there will be better outcomes arising out of the imposed higher tariff on neighboring India," he added.

Besides, the renowned economist suggested for enhancing further the port efficiencies, addressing the pressing issues at the National Board of Revenue (NBR), easing congestion at the ICD, resolving workers' unrest in the industrial belts and thus ensuring uninterrupted power and gas supply.

He said if good relations could be built with the US buyers by the Bangladeshi exporters by taking advantages from such a condition, then Bangladeshi exports to the US market would boost further subject to the timely shipment of goods and if there is no such violence and unrest in the coming months centering the next general election.

Apart from these, the efficiency at ports should also be enhanced since there would be added pressure of shipments, he said.
He went on saying, "The government should take some urgent initiatives and I'm very much hopeful that the Bangladeshi entrepreneurs and exporters will be able to seize these opportunities," he added.

Dr Zahid also said time will say whether Bangladesh can boost its exports by another $2 to $3 billion in the coming months following such comparative advantages in US tariffs.

Talking to the national news agency over the imposition of 50 percent tariffs on Indian exports to USA and its impact on Bangladesh's exports, Mahmud Hasan Khan, President of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said that surely there would be opportunities for Bangladesh, but the local exporters should tap such potentials.

He said that some export orders would be diverted to Bangladesh from India while there is also a very strong chance to boost Bangladesh's exports to the US market.

"But we need to enhance efficiency at Chattogram Port with urgent government measures while the 'lead time' should also be reduced further. We need to enhance our capacity in all fronts and hopefully we'll be able to tap the potentials," he added.

Besides, the BGMEA President also underscored the need for keeping smooth the traffic on Dhaka-Chattogram Highway to ensure smooth transportation of goods, addressing the energy crisis alongside maintaining the law and order situation across the country.

Mohammad Hatem, President of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said that imposition of 50 percent tariff on India by the US would definitely bring some comparative advantages to Bangladesh for which all the concerned stakeholders are holding discussions at various levels of the government.

In order to properly taking advantages from such a condition, Hatem strongly advocated for addressing various issues in the banking sector, addressing the power and energy crisis, resolving the problems at the NBR, especially at the Customs Department.

He opined that the interim government should have to face prudently various challenges surrounding the industries in order to take advantage from such tariff imposition.

"If the industries remain healthy and sound, then those can deliver. If the industries struggle to survive, then it won't be possible for those to make best practices," he added.

The seasoned industry leader suggested for restoring discipline in the banking sector through streamlining its policies and circulars, restoring the EDF facility, rationalizing the interest rates, operationalizing fully the back to back L/C operations to facilitate import and export operations, addressing the complexities at the Customs Department, and thus pursuing 'Zero Tolerance' in maintaining the law and order.

"If we can ensure this, then it is possible for us to attain the export target in the current fiscal year (FY26)," he said.

Currently, the trade gap between Bangladesh and the USA is $6 billion, whereas Bangladesh exports goods worth $8.2 billion and imports goods worth $2 billion from the US.

India counts the US as its single largest export partner. Its total goods' exports reached about $434 billion in the year ended March 2025, and nearly 20%, or $86.51 billion worth of goods were shipped to the US, according to the latest official data.