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Summary On Export From Bangladesh
Summary On Export From Bangladesh
Introduction
1.1 The word export is derived from the conceptual meaning as to ship the goods and services
out of the port of a country. The seller of such goods and services is referred to as an
“exporter” who is based in the country of export whereas the overseas based is referred to as
an “importer” (foreign buyer). In international trade “exports” refers to selling goods and
services produced in home country to other foreign markets.
1.2 Bangladesh exports about 168 different products and services to almost 186 countries. The
main exportable are Readymade Garments, Knitwear, Home Textile, Frozen Food, Leather &
Leather goods, Jute and goods which contribute near about 89% of our total export. On the
other hand the main export destination of Bangladesh are USA, Canada, EU Countries
including U.K, Germany, France, Italy, Sweeten etc contributing almost 93% of total export.
The export statistics reveals that Bangladesh is proceeding with positive export growth since
1974-75 . Anexxure-17 presents the export trend from the year1974-75 to 2010-11 as well as
the export performance in July-June, 2011.
2. Procedure of Export
2.1 A company or individual businessmen with trade license is capable of doing export
business. But before that he/the company has to obtain export registration certificate (ERC)
from the office of Chief Controller of Import and Export (CCI&E), 111-113 Motijheel
Commercial Area, Dhaka. Generally Trade License, Bank Balance Certificate, Membership
from respective trade associations are required for obtaining ERC.
2.2 For starting a business in Bangladesh, it starts with registering the company name at the
Office of the Registrar of Joint Stock Companies & Firms. The office is located at 24-25
Dilkusha, Commercial Area, Dhaka. This Office accords registration of Companies,
Associations and Partnership Firms under the Companies Act, other related acts, rules, orders
and ensures lawful administration of them.
2.3 The new entities should also obtain trade license from the city corporation where it is
located. Depending on the type of the business it may also have to obtain license or certificate
from BSTI, BRTA, etc.
2.3 For some products the exporters have obtain quality assurance certificate from BSTI/
Department of Fisheries (DOF)/ Respective Trade Associations etc.
2.4 The exporter can export with or without Letter of Credit (LC). The Contract/ Agreement
with foreign buyer or CAD or Advance TT methods etc. are also allowed for export. The
exporters then submit EXP form to bank and prepare bill of export. With all these documents
exporters then approach at the customs authority of the port through which they want to ship
his exportable. After examining all the papers the customs authority allows them to export and
after boarding the products the authority gives them a bill of lading. After shipment the
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customs authority assures them stamping a seal in the back of bill of lading and provide
Export General Manifest (EGM).
The Export and Import Control Act 1950 (Annexure-1) provide the Government power to
administer the import and export of Bangladesh under which a three yearly Export Policy is
published. The Export Policy (Export Policy 2009-12, Annexure-2) generally guide the over
all export of Bangladesh and help facilitate the exporters. The salient features of the Export
Policy 2009-12 are as follows:
3.1 Products which cannot be exported and which can be freely exportable
3.1.1 Export Prohibited Products: Some Products cannot be exported. The list of such
prohibited products can be found in Annex -1 of the Export Policy 2009-12.
3.1.2 Products under Conditional Export: Products which are exportable under some
conditions can be exported only after fulfilling those conditions. Such products have been
listed in Annex-2 of Export Policy 2009-12.
3..1.3 Exportable Products: All other products except the products enlisted in Annex-1 and
Annex-2 of the Export Policy 2009-12 i.e. export prohibited products and the products under
conditional export shall be freely exportable.
3.1.4 Export of Samples which don't have commercial values: Samples of exportable can
be exported freely but with some conditions outlined in para 2.2.1.2 of Export Policy 2009-
2012.
3.2 Entre-pôt and Re-export Trade
Entre-pôt trade and re-export shall have to be conducted under the procedures stipulated in the
Public Notice No. 42 (2003-2006)/import dated June 28, 2005 (14 Ashar 1412 Bangla)
(Annexure-3) issued by the Office of the Chief Controller of Import and Export.
3.2.1 Entre-pôt trade means the export of an imported product at a price at least 5% higher
than the import price. No change whatsoever in the quality, quantity, shape or any other
aspect is necessary in this respect. Products under entre-pôt trade shall not come out of the
port boundary. However, the products can be brought out of the port boundary under special
authorization.
3.2.2 “Re-export” means the export of an imported product within a specific period of time
with a value addition of at least 10% to the imported price by changing the quality or shape or
both of the products by means of local reprocessing.
Bangladesh maintains excellent trade relations with foreign countries. Bangladesh became a
member of World Trade Organization (WTO) from its inception. Bangladesh is also the
member of South Asian Free Trade Area (SAFTA), Asia Pacific Trade Agreement (APTA),
BIMSTEC and, Organization of Islamic Conference (OIC). Through those organizations and
some times bilaterally Bangladesh enjoy preferential treatment on export trade. Of all those
preferential treatments the most important one is Generalized System of Preference (GSP). In
this system as an LDC, we get some preferential advantages including duty free or concession
and quota free access. We are getting GSP in 37 Countries including 27 EU countries and 10
others like USA, Canada, Japan, Norway, Switzerland etc.
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Frequently Asked Questions (FAQ)
Ans: To get Export Registration Certificate (ERC) you have to apply to the Office of the
Chief Controller of Import and Export (CCI&E) in prescribed form. Along with the
application you have to submit the following documents:
Copy of trade license
Nationality certificate issued by Ward Commissioner or Union Parishad Chairman (for
Bangladeshi nationals)
Income tax payment certificate of the previous year (in applicable cases)
Valid membership certificate from the Chamber of Commerce or Registered Trade
Association
Bank solvency certificate
Partnership deed or Incorporation certificate
Photograph – 2 copy.
Prescribed form and other related information are provided in the official website of the
CCI&E. The web address of CCI&E is www.ccie.gov.bd
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(7) What is compliance in export business?
Ans: In export business compliance means meeting the foreign buyer requirements.
Sometimes the foreign buyers/buyer country/countries impose some special conditions on
quality issues, working environment in the factory, etc. These requirements are known as
compliance.
Ans. Other than restricted items enlisted in Annex-1(export prohibited items) and Annex-2
(conditional export items) all the products are freely exportable and don’t require any export
permission from Government. For conditional export items you need clearance from the
appropriate authority as mentioned Annex-2 of the Export Policy 2009-2012.
(9) I will buy some finished products and then again export it at higher rate. Is it
possible?
Ans: Yes, you can but under some conditions i.e. in that case your export will be Entre-pôt
and Re-export you need to follow the rules and procedure laid in respective policy or circulars
which is attached here with as Annexure-3)
13. How an exporter export certain products. How can I help him?
Ans: At first and exporter needs an ERC (Export Registration Certificate) upon submission of
bank balance, membership certificate of some association, trade license etc as explained in
answer of question no-5. Then he can search for foreign buyers. He can collect some buyers
list from Export Promotion Bureau (EPB) and Bangladesh Mission’s of the export destination
country.
14. What is FTA and PTA and explain Bangladesh Position in these agreements?
Ans:
FTA stands for Free Trade Agreement. E.g. Bangladesh js a member of South Asian
Free Trade Agreement (ASAFTA)
PTA stands for Preferential Trade agreement. E.g. Bangladesh is a member of Asia
Pacific Trade Agreement (APTA)
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15. What is RTA and BTA and explain Bangladesh Position in these agreements?
Ans:
RTA stands for Regional Trade Agreement E.g. Bangladesh js a member of in
BIMSTEC (Bangladesh, India, Myanmar, Srilanka, Thiland)
BTA Stands for Bilateral Trade Agreement. No bilateral agreement has been finalized
but Preliminary Bilateral Trade Talks with India, Pakistan and Srilanka
16. What are comparative advantage, Competitive Advantage and Absolute advantage?
Ans:
Comparative Advantage: Identifying which activities a country/firm/individual is most
efficient at doing (e.g. naturally available-cheap labour, cheap resource, better climate etc).
Another example that Canada has the right climate/ skilled labour, resources etc. to produce
wood-pulp efficiently. CA theory states that grow and sell the product which you have
comparative advantage (CA) and buy the product in which you have less CA.
19. What are Primary goods, Manufactured goods, Traditional and Non -traditional
goods?
Ans:
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Primary goods: Almost Obtained naturally: Frozen food, Dry fish
Manufactured Goods: Manufactured in Industries: Chemicals, Medicine
Traditional Goods: Jute, Tea, Jute goods
Non-Traditional Goods: Others except Traditional Goods.
20. How can you separate the LDC’s from Developing countries?
Ans: The Criteria for the identification of the LDCs are as follows:
In its latest triennial review of the list of Least Developed Countries in 2003, the Economic
and Social Council of the United Nations used the following three criteria for the
identification of the LDCs, as proposed by the Committee for Development Policy (CDP):
• a low-income criterion, based on a three-year average estimate of the gross domestic product
per capita (under $750 for inclusion, above $900 for graduation);
25. How many kinds of CIP are being declared and what is the criteria for CIP
exporters?
Ans: There are different types of CIP i.e. CIP-Export, CIP-Industry and CIP-NRB in
Bangladesh. We deal with CIP-Export and the criteria used to determine Commercially
Important Person (CIP) for Export are as follows:
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Minimum export earning for 9 specific product is US$0.10 million and for other sector
US$ 1.00 million.
Not a loan or Tax (all tax) defaulter.
No trade dispute with the foreign buyer.
Not convicted by the court.
No false information provider.
Ministry of Commerce or Export Promotion Bureau publishes advertisement regarding
invitation of application for CIP in August of the year. For further information a copy of the
“CIP (Export) Plicy-2006 can be seen at Annexure-6)
Mode11- Services taken from other countries like healthcare, nursing, etc
28. What facilities for export-oriented industries are being offered by Board of
Investment (BOI)?
Ans:
Use of a portion of the foreign currency earned by the exporter under the retention
quota of Bangladesh Bank for foreign trip, participation in international fairs and
seminars, import of raw materials, spares and equipment, establishment of office
abroad, etc.;
Export development Fund(EDF) offers joint venture capital at low interest rates,
assistance for obtaining foreign technical assistance, service and technology, assist in
sending marketing missions abroad, assist in the establishment of sales & display
centers and warehousing facilities abroad, assist in participation in product
development & marketing training programs for export promotion, etc.;
Tax holidays (5 years for Dhaka, Chittagong & Khulna and 7 years for other areas);
Agro-processed industries, ICT, to be relieved from income tax;
Restructure the Export Credit Guarantee Scheme;
Up to 90% bank loan against irrevocable LC or confirmed contracts.