Strengthening ties: Pakistan's bid to enhance exports with Bangladesh

Delegates from the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) are heading to Bangladesh in an attempt to boost bilateral trade between the two countries. The delegates are mainly interested in boosting export levels, which currently stand at $800 million.

Officials claim that this figure can be easily boosted up to three billion dollars in the coming years if bilateral relations improve.

One of the primary beneficiaries of improved bilateral relations will be airlines, as flights between the two countries will resume. This could help local airlines, especially Pakistan International Airlines (PIA), as visas are expected to be issued in abundance, and hence, a lucrative route will be secured.

The surge in visa issuance is expected as Bangladeshi officials are interested in opening up their borders to genuine Pakistani investors. The new route is expected to generate respectable cash flows for PIA and could even help in its privatisation efforts as it will appear more attractive to investors.

Another beneficiary of enhanced trade will be the agricultural sector in Pakistan as Bangladesh imports approximately six billion dollars worth of fruits and vegetables annually.

These include onions, which Bangladesh has been importing primarily from India. Bangladesh’s vegetable import bill, along with India's, stood at over two billion dollars in 2022. However, with India imposing a ban on the export of onions in 2024, it is prime time for Pakistan to capitalise on the need gap in the Bangladeshi market.

Aside from Indian export bans, Bangladesh alternates between importing from either Pakistan or India based on who sets a lower price. With the price of Indian onions projected to rise, Bangladesh could get a higher import order of Pakistani onions.

The benefits of onion exports, however, should be taken with a grain of salt (no pun intended). Pakistan’s vegetable market frequently experiences a shortage of onions, resulting in the markets flooding with Iranian onions, which are either imported or illegally smuggled across the border.

The chairman of the Rice Exporters Association claims that Pakistan could also export 200 million dollars worth of rice annually. This would boost bilateral trade with Bangladesh past the one-billion-dollar mark, bringing in vast sums of foreign exchange revenues for the cash-strapped nation.

All in all, the agricultural sector will flourish as its yields find their way to the international market. Exporting to Bangladesh will not just bring in revenues but will also allow Pakistani products to gain recognition in the market — A market where goods from India have dominated in the past.

With Bangladesh and Pakistan sharing a common sector as their largest textiles, collaborations between the two could also flourish in terms of exports. There can be huge gains from trade to be made with information and technology sharing alone.