Pakistan and Bangladesh were the only countries figuring in India’s Foreign Direct Investment (FDI) negative list of FEMA (Foreign Exchange Management Act). India lifted the FDI-related restrictions with Bangladesh early last year.
“The Bangladesh government is expected to allow case-to-case industrial projects to be set up in India or to commission joint venture projects (in India),” said Annisul Huq, president of SAARC Chamber of Commerce and Industry (SCCI).
“A food processing plant and a tyre manufacturing industry would be set up in India. The Bangladesh government is likely to allow investment in India for these projects,” Huq and India-Bangladesh Chamber of Commerce and Industry (IBCCI) president Abdul Matlub Ahmad told reporters here.
PRAN (Programme for Rural Advancement Nationally) group, a Bangladeshi food processing firm, is keen to set up agro-processing plants in Tripura, Orissa and Tamil Nadu while a joint venture tyre manufacturing industry would be set up in Tripura by Indian and Bangladeshi investors.
Bangladesh’s Nitol-Niloy group and two Kolkata-based companies signed a memorandum of understanding (MOU) here Saturday to commission the tyre manufacturing industry in Agartala using the natural rubber available in Tripura, which is the second largest rubber producer in the country after Kerala.
Bangladeshi trade and industry groups, including the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) and IBCCI are strongly pressing to increase trade and economic activities with India’s northeast region and urged Dhaka to provide transit facilities to India.
A 10-member Bangladeshi trade delegation headed by Huq and comprising members of various Bangladesh trade bodies held a series of meetings here over the past few days with Indian businessmen and government officials to chalk out strategies for setting up joint venture projects and intensifying trade and business between the two countries.
“For the economic interest of both northeast India and Bangladesh, there are huge scopes to tap the resources of both the countries. Northeast India’s large reserves of gas, coal, stones, natural rubber, bamboo, various forest produce and agro-products are still unutilized,” Huq said.
Referring to opposition in increasing economic ties with India by some quarters in Bangladesh, they said: “We have to change the mindset of those who oppose mutual economic activities. With the change of the economic scenario the approach would be changed automatically.”
India has been pressing for transit facilities through Bangladesh for better connectivity between the land-locked northeastern region and the rest of the country.
“If the Bangladesh government provides transit facilities via Chittagong, Sherpur, Ashuganj and Mongla ports, it would benefit in terms of revenue,” SCCI president said, adding that the matter was in principle agreed during the three-day visit to India by Bangladesh Prime Minister Sheikh Hasina last month.
According to Huq, by providing logistical support to India (including use of Bangladeshi ports by India) Bangladesh can gain 1.2 billion US dollars annually.
The SCCI president said: “A serious effort would be taken to increase the number of SAARC Visa Exemption stickers from 100 to 500 to boost trade and business among the SAARC (South Asian Association for Regional Cooperation) countries.” At present 100 leading businessmen of each SAARC country have been using the SAARC Visa Exemption stickers.
He said that trade among SAARC countries is around 3.5 percent of the region’s total trade with the rest of the world.
“India’s trade with Bangladesh is 3.4 billion dollars, while Bangladesh’s trade with India is less than half a billion dollars. This trade gap has to be narrowed down for the crucial economic development of people of the two neighbors.”
“A multipurpose business complex comprising budget hotels and convention halls would be set up in Agartala to conduct business of both northeast India and Bangladeshi products,” Huq added.
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