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Trade History Between Ban vs Pak

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The bilateral relations between the Islamic Republic of Pakistan and the People's Republic of Bangladesh are influenced by the fact that Bangladesh was a part of Pakistan from 1947 to 1971, when it achieved independence after the Bangladesh Liberation War and the Indo-Pakistani War of 1971. As part of historical Shimla Agreement, India sought to make sure that Pakistan would take steps to recognize Bangladesh.

Pakistan sought China's help in blocking Bangladesh's entry into United Nations until 1974. Behind the scene India rallied behind Bangladesh to help gain international recognition. By end of March 1973, approximately 99 countries had recognized Bangladesh.[1] Pakistan eventually recognised Bangladesh in 1974.

History
Liberation war and independence

After the partition of British Indian Empire by the United Kingdom in 1947, Bangladesh was integrated in Pakistan which was known as East Bengal until 1955 and thereafter as East-Pakistan following the One Unit program.

Bilateral relations between the two wings grew strained over the lack of official recognition for the Bengali language, democracy, regional autonomy, disparity between the two wings, ethnic discrimination, and the central government's weak and inefficient relief efforts after the 1970 Bhola cyclone, which had affected millions in East Pakistan. These grievances led to several political agitations in East Bengal and ultimately a fight for full independence. In March 1971, the Pakistan Armed Forces began "Operation Searchlight," which targeted intellectuals, political activists, Hindus and other minorities.[2] The figure of people killed by Pakistani forces remains disputed, with estimates ranging from 300,000 to 3 million.[3][4] About 8-10 million people became refugees in India.[5] Many Bengali policemen and soldiers mutinied and nationalists formed a guerrilla force, the Mukti Bahini with Indian and Soviet Union support. When a declared war broke out between Bangladesh and Pakistan in December 1971, the joint forces of Indian Army and Mukti Bahini later known as Bangladesh Armed forces defeated Pakistani forces in East Pakistan and the independent state of Bangladesh was created.[6]
1974-2012: Establishment and growth of bilateral relations

The left-oriented Pakistan Peoples Party (PPP) led by Zulfikar Ali Bhutto, who had been the main political opponent of Sheikh Mujibur Rahman, came into power in the aftermath of Bangladesh's separation from Pakistan. A heavyy lobbying staged by Pakistan, other states such as the People's Republic of China, Saudi Arabia and some other Middle Eastern nations, refused to recognize Bangladesh. In 1972, Pakistan left the Commonwealth of Nations after it extended membership to Bangladesh. For its part, Bangladesh demanded an apology from Pakistan for war crimes committed by the Pakistani military and reparations. Bangladesh's development of close ties with India, which had played a role in securing its independence, also annoyed Pakistan.

On the issue of Bangladesh’s application for membership to the UN, China, on Pakistan’s request, exercised its veto power for the first time to stall the move, which helped Pakistan to secure in a bargain the release of its POWs and the return of troops to their prewar positions.[7]

In 1974, the relationship between Bangladesh and Pakistan thawed. Sheikh Mujibur Rahman withdrew the bans on some pro-Pakistan organisations that had operated before Bangladesh's independence. Rahman visited Lahore for an Organization of the Islamic Conference summit, and in return the Parliament of Pakistan authorised Bhutto to extend recognition to Bangladesh.[8] In June 1974, Pakistani Prime Minister Zulfiqar Ali Bhutto visited Bangladesh and paid homage to Bangladesh's war memorial at Savar Upazila.[9] Both nations discussed an agreement in 1975 in which Bangladesh agreed to take up half of Pakistan's pre-1971 external debt provided Bangladesh received half of the country's pre-1971 assets and credit went unresolved.[10]

Relations improved considerably under the governments of Ziaur Rahman and Hossain Mohammad Ershad in Bangladesh, which had grown more distant from its war ally, India.[10][11] Five Pakistani heads of government made official visits to Bangladesh since the 1980s and numerous trade and cultural agreements have been signed.[12] Common concerns over India's regional power have influenced strategic cooperation leading to a gift of several squadrons of F-6 fighter aircraft to the Bangladesh Air Force in the late 1980s although there was no serious effort to maintain them as they were later left to be destroyed by a cyclone.[12] Trade between the two countries currently stands at $340 million which was described by the Deputy High Commissioner of Bangladesh, Ruhul Alam Siddique as 'negligible when taking into account the combined population' (of both countries). Areas he hoped would induce investment from Pakistan to Bangladesh included the textiles and energy sectors.[13]

In 1985, President Ziaul Haq visited the Bangaldeshi war memorial, and said "Your heroes are our heroes."[9] Bangladeshi president Erhsad visited Islamabad in 1986.[10] In 1998, Prime Minister Sheikh Hasina visited Pakistan.[9] In July 2002, Pakistani General Pervez Musharraf also visited the war memorial and said "Your brothers and sisters in Pakistan share the pain of the events of 1971."[9]

In December 2012, several members of Pakistan Parliament sought a Parliamentary resolution that would apologize to Bangladesh for the 1971 atrocities. This initiative was also supported by Hamid Mir.[8]

In December 2013, following the execution of Abdul Quader Molla, dubbed the "butcher of Mirpur"[14] for war crimes, the lower house National Assembly issued a statement condemning execution, claiming it to be politically motivated.[15] Pakistan's Interior Minister expressed sadness that Molla was executed for his "loyalty towards Pakistan".[16]

Following Pakistan's reactions, Bangladesh summoned the Pakistan envoy, conveying its displeasure at Pakistan's interference in its internal matters.[15] Bangladesh conveyed its displeasure at the National Assembly statement, Punjab Provincial Assembly statement, as well as the remarks by Pakistan's Interior Minister.[17]

Protesters in Bangladesh took the streets to express their displeasure by marching towards the Pakistan High Commission in Dhaka.

An issue of continuing controversy is the status and return of Biharis, also called Stranded Pakistanis to Pakistan.[19] Numbered around 540,000, these communities had migrated to what became East Pakistan from the Indian state of Bihar after the partition of India in 1947.[10] During the liberation war, these communities supported the Pakistani government and later wanted to emigrate to Pakistan, which stalled and hesitated.[10] By 1982 about 127,000 had been repatriated, leaving about 250,000 people still demanding repatriation.[10] In 1985 there was some progress in this area when Pakistani president Zia-ul-Haq agreed to accept the "stranded Pakistanis."[10] In a 2002 visit to Bangladesh, Pakistani president Pervez Musharraf signed numerous bilateral agreements but said he could not allow the emigration of Biharis to Pakistan for the time being.[19]
Defense Cooperation

Defense cooperation improved considerably under the military regimes of Ziaur Rahman and Hossain Mohammad Ershad in Bangladesh, which had grown more distant from its war ally, India. Common concerns over India's regional power have influenced strategic cooperation leading to a gift of several squadrons of F-6 fighter aircraft to the Bangladesh Air Force in the late 1980s.[20]
Trade

Bilateral trade between the two countries has been growing slowly over the past years. During the eleven-year period between 2000–01 and 2010–11, Pakistan export to Bangladesh grew at an average annual rate of 27.6 percent and imports from Bangladesh grew at the rate of 9.2 percent. The total value of trade (export plus import) between the two countries in 2010-11 was about $983 million. To give a boost to bilateral trade between Pakistan and Bangladesh both countries have decided to finalise a bilateral Free Trade Agreement. FTA will pave the way for opening trade opportunity and will help expansion of trade between the two countries. Rummel, Rudolph J., "Statistics of Democide: Genocide and Mass Murder Since 1900", ISBN 3-8258-4010-7, Chapter 8, Table 8.2 Pakistan Genocide in Bangladesh Estimates, Sources, and Calculations: lowest estimate 2 million claimed by Pakistan (reported by Aziz, Qutubuddin. Blood and tears Karachi: United Press of Pakistan, 1974. pp. 74,226), all the other sources used by Rummel suggest a figure of between 8 and 10 million with one (Johnson, B. L. C. Bangladesh. New York: Barnes & Noble, 1975. pp. 73,75) that "could have been" 12 million. Bangladeshi war for independence Eager Eyes Fixed on Eurasia Russia and Its Neighbors in Crisis Russia and Its Neighbors in Crisis, Edited by IWASHITA Akihiro, Slavic Research Center, p 211- "Pak MPs to propose for apology to Dhaka". The Daily Star (Bangladesh). 2012-12-07. "PM to visit Pakistan to attend D-8 summit". 2012-11-10. Bangladesh - Pakistan The Zia regime Bangladesh's emotional scars Dhaka offers Pakistani businessmen multiple visas Nelson, Dean (12 December 2013). "Bangladesh hangs 'Butcher of Mirpur' for ‘war crimes’". Telegraph. Retrieved 18 December 2013. "Bangladesh grills Pakistan envoy over Molla resolution". Dawn. 18 December 2013. Retrieved 18 December 2013. "Jamaat leader’s hanging in Bangladesh ‘saddens’ Nisar". Dawn. 13 December 2013. Retrieved 18 December 2013. Zaman, Sheikh (18 December 2013). "Dhaka summons Pakistan high commissioner over Molla resolution". Dhaka Tribune. Retrieved 18 December 2013. "Dhaka demonstrators protest Pakistan's reaction to Molla's execution". Express Tribune. 18 December 2013. Retrieved 18 December 2013

Pakistan Foreign relations of Pakistan Text is available under the Creative Commons Attribution-ShareAlike License; additional terms may apply. By using this site, you agree to the Terms of Use and Privacy Policy. Wikipedia® is a registered trademark of the Wikimedia Foundation,

FAISALABAD: Bangladesh and Pakistan will hold a meeting of the Joint Economic Commission during the year to pace up business activities, said Ambassador of Bangladesh to Pakistan Suhrab Hossain at the Faisalabad Chamber of Commerce and Industry (FCCI).

There are big opportunities to increase bilateral trade and investment between both countries, the envoy added in his address to the industrialists of Faisalabad. He pinpointed Bangladesh’s industrial and agricultural sector for profitable joint-ventures.

Hossain went on to say that the policies of the government of Bangladesh were pro-business, in addition to availability of cheaper labour, uninterrupted supply of power and gas apart from other incentives and preferential treatment for foreign investors.

Elaborating on his earlier statement, the envoy said that duties on raw material imports were very low and the government allowed five years of no taxes to foreign investors. The Bangladeshi government is giving great importance to industrial and agricultural sectors, he added.

The envoy assured that the Embassy of Bangladesh would lend full support to the Pakistani business community for setting up joint-ventures. In this regard, special industrial zones have been established completed with the entire necessary infrastructure in Bangladesh.

He also pitched potential for investments in other areas including electrical, information technology, sport goods, pharmaceuticals and ceramics.

Responding to the proposal for collaboration in tourism development, Hossain said that tourism authorities of both countries could devise ways and highlight areas as very rich tourism potential existed in Pakistan and Bangladesh.

Also addressing the industrialists, FCCI President Engineer Suhail bin Rashid said both Bangladesh and Pakistan were part of South Asian Free Trade Area (Safta) and South Asian Association for Regional Cooperation Preferential Trade Agreement (Sapta) and members of Saarc and Developing Eight Countries forum.

Considering the combined size of the economy at $345 billion and consumer market of around $346 million, trade could be enhanced manifold.

FCCI president asked for frequent exchanges of trade delegations, identification and trade of more products where both countries have a competitive edge, single-country exhibitions and technology transfers, besides collaboration in technical and vocational training.

Published in The Express Tribune, October 12th, 2013.

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Reader Comments (7)

Dhaka Oct 12, 2013 - 7:56PM Reply

We can export hi-tech equipments to pakistan and they can export foot wear,garments,toys etc to us.

Recommend3 optimist Oct 13, 2013 - 4:10AM Reply

Lol @ Dhaka

I know you wanted us to write against Bangladesh and make fun of it. We will not ;) . We look forward to increased trade ties and enhanced friendship with Bangladesh (and a little better relations with India as well).

Recommend2 Zen.One Oct 13, 2013 - 3:49PM Reply

@Dhaka: Can you elaborate on it. Name a few hi-tech equipment Bangladesh makes and are into exports.

Recommend pround punjabi Oct 15, 2013 - 5:58PM Reply

@Dhaka: we do not need any trade with bangladesh. bangladesh is very poor country.pakistan is rich country. if we trade with you it will drag us to lower level as bangladesh. bangladesh embassy should be closed in pakistan. pakistan should cut diplomatic relation with bangladesh.

Recommend Imran Kiyani Oct 17, 2013 - 12:47AM Reply

@ Pround punjabi <—–is a Indian Sikh playing games again like they did when eaas and west pakistan were together.

sikhs burn inside whn paks and bangs get along. no khalistan for u.

Recommend1 Bangladeshi Nov 27, 2013 - 1:48AM Reply

@optimist and @Zen.One actually, bangladesh already exports pharmaceuticals, ocean-going vessels and ferries to pakistan.

Recommend1 Bangladeshi Nov 27, 2013 - 1:56AM Reply

Bangladesh has also asked for an FTA with Pakistan, as part of its wider policy of promoting South Asian integration. Rekindling some of our old links, through say a free trade and travel regime, can enhance both economies

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#1237, 8 December 2003 Pakistan Bangladesh Free Trade Agreement
Anand Kumar
Institute for Conflict Management

Trade liberalization seems to be the buzzword in the subcontinent right now. Latest in the series of talks for bilateral free trade agreements has been the one between Pakistan and Bangladesh in Dhaka (November 16-17). Pakistan’s delegation was led by Jafar Iqbal Qadir of its Commerce Ministry while the Bangladeshi side was led by Elias Ahmed. After the talks both sides agreed to sign a free trade agreement (FTA) and a draft deal will be finalized at talks to be held in Islamabad in January 2004 soon after the SAARC summit.

Little trade takes place between Pakistan and Bangladesh and the balance tilts in favour of Pakistan. Bangladesh imported goods worth $68.68 million from Pakistan during the last fiscal year, while its export amounted to $31.5 million, leaving a deficit of $37.18 million in favour of Islamabad. In fiscal 2001-2002, Bangladesh imported goods worth $67 million while its export was to the tune of $28.6 million. Major Bangladeshi products that enter the Pakistani market include raw jute, jute goods, tea, leather, agri-products and chemical items. Bangladesh imports textile and textile products, beverages, tobacco, vegetable products, fruits, processed food and a motley of light engineering products.

Bangladesh was offered a proposal to enter into a free trade agreement with Pakistan during the visit of Pakistani Commerce Minister in 2002. However, Pakistan became keener to notch up such a deal with Dhaka as soon as possible due to the fact that India was going to do the same within a year.

Though Bangladesh responded positively to the Pakistani proposal of the FTA it showed a lot of reservations at the two-day negotiations. Bangladeshi negotiators raised the issue of special and differential treatment of the Bangladeshi goods on the ground of being a least developed nation. Bangladesh proposed free access to Pakistani products after 12 years of signing the FTA, while it wanted Islamabad to open its market one year after the deal. But, Pakistan did not agree to this. The major points in the negotiations related to relaxed rules of origin, reduction of direct tariffs, elimination of non-tariff barriers, longer phase-out period of tariff withdrawal and anti-dumping and countervailing measures. Bangladesh persisted with its "negative list approach" in the negotiations for the pact in a bid to avert a possible adverse impact on its local industries. This approach meant allowing duty-free movement of all products between the two countries save the items incorporated in the list.

Both sides were able to forge consensus on a number of issues. Pakistan has agreed to give Bangladesh special and differential treatment under the bilateral trade deal and both countries will have negative lists. In view of its status as a least developed country, Bangladesh will enjoy a longer phase-out period and have a longer negative list of products than Pakistan. Besides, there will be two separate lists under which one category of products will enjoy immediate tariff concession and another category will see tariffs withdrawn in phases.

Pakistan had already granted duty-free access to Bangladeshi tea and jute goods, which came into effect last year. Under this concession, Bangladesh was allowed duty-free export of jute and tea up to 10,000 tonnes a year to Pakistan. But Dhaka could utilize only 60 per cent of the quota for tea last year.

During the trade negotiations with India, Bangladesh made removal of non-tariff barriers a central issue. But, interestingly, after negotiating with Pakistan, Elias Ahmed stated that Bangladeshi exporters were not facing any significant non-tariff barriers in the Pakistani market. Bangladesh is trying to use free trade as a means to bridge the trade gap by getting special and differential treatments for its products. But, its failure to make use of concessions given earlier for tea and jute products points to a weakness in its economy, because of which it is unable to use the opportunities.

The latest round of talks between Bangladesh and Pakistan has allowed them to agree on major parameters of a framework for negotiating the FTA, including the negative list of items, rules of origin and tariff phase-out period. This has also prepared a foundation for the next round of talks. However, two major issues -- rules of origin and phase-out period – remain to be settled and the future of free trade regime will depend on these.

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