US cuts Bangladesh tariffs to 19% in trade deal

"The United States and Bangladesh unveiled a new trade agreement on Monday. Under the deal, certain volumes of imports from Bangladesh into the US can receive preferential treatment, attracting zero tariffs. But the volume will be related to how much textiles the US exports to Bangladesh. The US had "committed to establishing a mechanism for textile and apparel goods from Bangladesh using US-produced cotton and man-made fiber to receive zero reciprocal tariff in US market," Bangladesh's interim leader Muhammad Yunus said in a statement."

"The US is Bangladesh's biggest single destination for apparel exports, totaling $7.34 billion (6.17 billion) in 2024. But Bangladesh faces stiff competition from other Asian nations, such as India, which announced its own trade deal framework with the US last week, and Vietnam. Worth $38.48 billion in 2024, Bangladesh's readymade garment industry is its biggest export earner, accounting for more than 80% of total export earnings and employing about 4 million workers."

"The White House said Bangladesh had agreed to provide significant preferential market access for a range of US industrial and agricultural goods, including chemicals, medical devices, machinery and motor vehicles and parts, and US farm and food products. Bangladesh will cut tariffs to zero on products such as poultry, pork, seafood, rice, corn and cereal grains when the agreement enters into force. The tariffs on some other US products, such as almonds, will reduce to zero over five or 10 years."

Certain volumes of Bangladeshi imports into the US can receive zero tariffs under a bilateral deal, with eligible volumes tied to US textile exports to Bangladesh. The US committed to allowing textile and apparel goods from Bangladesh using US-produced cotton and man-made fiber to receive zero reciprocal tariffs in the US market. Bangladesh’s apparel exports to the US totaled $7.34 billion in 2024. The readymade garment industry was worth $38.48 billion, accounted for over 80% of export earnings, and employed about 4 million workers. Bangladesh agreed to cut tariffs to zero on many US goods and to ease some non-tariff barriers; most Bangladeshi products entering the US will face a 19% flat rate.

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