Political

Bangladesh-Thailand relationship boasts of strong political and cultural bonds. With their diplomatic ties established on October 5, 1972, Thailand opened its Embassy in Dhaka in 1974 and Bangladesh setup it’s Embassy in Bangkok in 1975 at the ambassadorial level.  There have been numerous exchanges of visits between the two friendly countries; the highest-ranking visits from Bangladesh being the visit by Shaheed President Ziaur Rahman in 1979, President Hussain Mohammad Ershad in 1985, 1988 and 1990, Prime Minister Kazi Zafar Ahmad in 1990 and Prime Minister Begum Khaleda Zia in December 2002 and 2004. The highest ranking Thai dignitaries to visit Bangladesh were Prime Minister Prem Tinsulanond in 1983, His Royal Highness Crown Prince Maha Vajiralongkorn in 1992 and Prime Minister Dr. Thaksin Shinawatra in July and December 2002 and January 2004.  With the ‘Look-East’ foreign policy initiative of Bangladesh, the Government to Government and people to people relationship has been growing from strength to strength since the establishment of diplomatic relationship between Bangladesh and Thailand.

 

Trade and Commerce

Although trade volume between Bangladesh and Thailand has steadily increased over the years, the trade balance continues to remain in favour of Thailand. But sustained growth of Bangladesh economy and foreign investment in sectors like manufacturing, energy, agriculture and communication etc has created new avenues for Bangladeshi exporters to exploit the competitive Thai markets. The Thai Government has given duty concessions to 229 Bangladeshi products. It was granted on two phases. The first phase of tariff concession on 128 Bangladeshi products was effective since January 16, 2004. The second phase of tariff concession on the rest 101 Bangladeshi products was approved by the Thai authorities effective from May 28, 2004. Bangladesh has so far signed six MOUs / Agreements with Thailand to promote bilateral trade between the two countries.

Bangladesh's export items to Thailand include, among others, finished jute products, knitwear, ceramic ware, light engineering products, leather products, acrylic yarn, fertilizer, shrimp, shark fin and fish maws, frozen foods, dry fish etc. Imports from Thailand include, among others, vegetable products, fresh fruits, processed food, mineral products, textile articles, oil, paper, iron and steel articles, rubber, plastic products, cement, polymers, woven fabrics, synthetic yarn, refrigerators, sugar, chemical products, machinery, fish etc.

Trade between Bangladesh and Thailand during the last five years is as follows: (Figures are in million US dollar)

The private sectors of the two countries are also working together to enhance bilateral trade for the benefit of both economies. The two nations have signed agreement for the Promotion and Reciprocal Protection of Investments and MOU on Accounts Trade Agreements in 2002 and formed Joint Chambers of Commerce on July 9, 2002. Bangladesh declared Thailand a partner country at the Dhaka and Chittagong International Trade Fairs.

 

Investment

Bangladesh has a high potential to become an investment destination for the Thai investors specially in the textile, agro-processing, leather, energy and tourism sectors. The Thai investors can reap benefits by utilizing the low infra-structure cost, cheap labor and natural gas of Bangladesh. Thai investment in Bangladesh is gradually on the increase. Total sector-wise Thai investment in Bangladesh, as registered with the Board of Investment (BOI) up to December 2004, is US$ 53.66 million in 28 units. The Thai investors are mainly interested in the sectors of agro-processing, food and allied, textile, tannery & rubber, chemical, engineering and service industries etc.

Bangladesh welcomes foreign direct investment  from Thailand as well as from other countries in all areas of it’s economy with the exception of only five industrial sectors :

• Arms, ammunitions and other defense equipment and machinery
• Production of nuclear energy
• Forest plantation and mechanized extraction within the bounds of reserved forests
• Security printing (currency notes) and minting
• Air transportation and railways, which are reserved for the public sector

Foreign investors are encouraged to make 100 % direct investment or establish joint venture projects with the local partners or with the public sector in the following categories:

• Export-oriented industries
• Industries in the Export Processing Zones
• High technology import-substitute products
• Undertaking in which more diversified use of indigenous natural resources is-possible
• Basic industries based mainly on local raw materials
• Labor intensive/technology intensive/capital intensive industries
• Relocation of high technology related industries

 

Economic

The Joint Commission on Cooperation Agreement signed on January 29, 1982 between Thailand and Bangladesh and the BIMSTEC are the basis of economic cooperation between the two countries. Under the umbrella of Joint Commission on Cooperation Agreement, both the countries are making endeavors to promote bilateral economic and technical cooperation in the following areas:

• Agriculture
• Fisheries
• Science and Technology (An agreement is pending)
• Tourism development
• Private sector and joint investment (an agreement on promotion and protection of investment and capital is pending)
• Maritime and Civil Aviation
• Study tours and training