DHAKA: Coastal shipping lines between Bangladesh and Myanmar, its next-door neighbor to the east, could start functioning as early as March as a part of an effort to boost bilateral trade from its current level of $100 million to $500 million.

Commerce Secretary Mahbub Ahmed said, “The volume of trade will increase with the shipping lines.”

Smoother trade flows between the two countries could reduce the cost of manufacturing around the Bay of Bengal, and allow Western investors to find better deals through tripartite arrangements.

Last December, Bangladesh and Myanmar re-established direct Dhaka-Yangon air links.

Trade with fast-opening Myanmar, which had shed the stigma of Western sanctions and is courting foreign investment, could help Bangladesh diversify its economy beyond the garment industry, at a time when political turmoil and reputational risks have some international retailers considering sourcing their garments from other countries – including low-wage Myanmar.

“We are over-dependent on few markets and commodities,” says Mr. Ahmed, adding that new trade opportunities in Myanmar would bolster the efforts of diversification.

The technical committee of a joint Bangladesh-Myanmar trade commission has marked Chittagong, Mongla, Narayanganj, and Teknaf ports in Bangladesh and Yangon, Pathein, Sittwe, and Maungtaw in Myanmar for the new lines.

Some of the biggest Bangladeshi pharmaceutical manufacturers like Square and Beximco are already sourcing work in Myanmar. Bangladesh’s major imports from Myanmar include rice, lentils, fish, and timber. Its primary exports to Myanmar are pharmaceuticals, cement, condensed milk, and electric cables.

Still, business ties have been minimal despite the two countries’ shared border. In May 2007, Myanmar proposed a contract farming plan under which 10,000 Bangladeshi farmers were to grow crops such as paddy, maize, and soybean oil in Myanmar’s western Rakhine state. Despite interest on both sides, the plan never came to fruition.

And the issue of the displaced minority Muslim Rohingya in Rakhine state, who have few defenders in either country, remains a sometime irritant in bilateral relations.

Source: monitorfrontiermarkets.com
BDST: 1031 HRS, JAN 21, 2014