Bangladesh and SAARC Countries: Bilateral Trade and Flaring of Economic Cooperation

Md. Abu Issa Gazi, Abdullah Al Masud, Razuan Ahmed Shuvro, Abu Ishaque Hossain, Muhammad Khalilur Rahman


The primary purpose of this study is to observe the economic and
international trade relationships between Bangladesh and SAARC
countries during the Fiscal Years 2015-2016 to 2020-2021. This
research uses panel data to examine the relationship between
the nature and direction of exports and economic growth.
The researcher found that economic cooperation with SAARC
countries impacted economic growth, but there was insufficient
export adaptation. The study also showed that economic relations
have strengthened in recent epochs, and bilateral trade has
increased compared to previous years with SAARC countries.
The obtained results also showed that Bangladesh has suffered
from a long-standing trade imbalance with India and is in a
good position with Afghanistan, Sri Lanka, Bhutan, Maldives,
Nepal, and Pakistan. Our findings are beneficial for international
trade stakeholders and suggest that steps should be taken to
increase exports to reduce the trade deficit. Concern authorities
should be more aware of the expansion of trade facilitation and
infrastructure development.

JEL Classification: F5, F18, F23, F50, M16


international trade; economic relations; export-import; trade deficit


Ali, E. (2022). Bangladesh, Maldives Taking Bilateral Relations to a New Height. Bangladesh Post. Retrieved from:

Ali, E. & Talukder, D. K. (2009). Preferential Trade among the SAARC Countries: Prospects and Challenges of Regional Integration in South Asia. JOAAG, 4(1), 47-59.

Al-Taani, K. (2013). The Relationship between Capital Structure and Firm Performance: Evidence from Jordan. Journal of Finance and Accounting, 1(3), 41-45.

Ahmed, B., & Islam, M.T. (2019). Bangladesh–Nepal Trade Relations: Understanding the Influence of Economic Diplomacy. Jadavpur Journal of International Relations, 23(1) 105–119.

Baysan, T., Panagariya, A., & Pitigala, N. (2006). Preferential Trading in South Asia. World Bank Policy Research Working Paper No. 3813.

Bhattacharya, S. K. (2004). Does Bangladesh Benefit from Prefential Trade with India? A Gravity Analysis. Economic and Political Weekly, 39(48), 5152-5162.

Bhowmick, S., & Kamal, S. M. (2020). India-Bangladesh Partnership in Post-Pandemic Economic Recovery. ORF Special Report No. 119.

De, P., Raihan, S., & Ghani, G. (2013). What Does MFN Trade Mean for India and Pakistan? Can MFN be a Panacea? World Bank Policy Research Working Paper 6483.

Das, D. K. (2007). South Asian Free Trade Agreement: Prospects of Shallow Regional Integration. CSGR Working Paper 218/07.

Deepika, K., & Neena, M. (2014). Export-Led Growth in India: Cointegration and Causality Analysis. Journal of Economics and Development Studies, 2(2), 297-310.

Ewing-Chow, M., & Islam, Md. R. (2015). South Asian Free Trade Agreement and the Possibility of Regional Intregration within the SAARC: A Historical, Legal, and Economic Analysis. Asian Journal of Comparative Law, 2, 1-21.

Gazi, M. A. I. (2021). Foreign Trade: An Analysis of Bilateral Trade between Bangladesh and China. International Journal of Information, Business and Management, 13(1), 93-106.

Gazi, M. A. I., Sarker, M. M. H., & Hossaon, M. (2014). Bangladesh and International Trade: a Case Study on Bangladesh-India Bilateral Business. Banglavision, 13(1), 217-224.

Hossain, M. F., & Kibria, C. G. (2001). Impact of SAPTA on Export and Import of Major Member Countries: A Trial of Alternative Quantitative Analysis. Journal of Business Research, 3(4), 78-102.

Hasnat, M. A., Kamrul, I. T., & Abdullah, M. T. (2017). The Bilateral Trade Relation in the World: China Perspectives. International Journal of Economics, Business and Management Research, 1(4), 73-86.

Hossain, M. S. (2009). South Asian Free Trade Area: Implications for Bangladesh. MPRA Paper No. 18517.

Irum, S. (2013). South Asian Association for Regional Cooperation (SAARC): Its Role, Hurdles and Prospects. IOSR Journal of Humanities and Social Science, 15(6), 1-9.

Islam, A. M. (2019). Bangladesh Trade with India: Trends and Patterns. Athens Journal of Business & Economics, 5(2), 123-140.

ITA. (2022). Pakistan - Country Commercial Guide, International Trade Administration. Retrieved from:

Jain, S. C. (1999). Prospects for a South Asian Free Trade Agreement: Problems and Challenges. International Business Review, 8(4), 399-419.

Kabir, S. (2017). Analysis of Bilateral Trade between Bangladesh and China. Journal of Economics and Sustainable Development, 8(16), 10-18.

Kumar, A. (2010). Changing Dynamics of Sino-Bangladesh Relations, South Asia Analysis Group. Retrieved from: http//www. .

Kumar, R. (2020). South Asia: Multilateral Trade Agreements and Untapped Regional Trade Integration. International Journal of Finance and Economics, 26(2), 2891-2903.

Mukherji, I. N. (2000). Charting a Free Trade Area in South Asia: Instruments and Modalities. Proceeding the Second Conference of the South Asia Network of Economic Research Institute (SANEI), August 28-29, Katmandu.

Liu, A., & Li, D. (2014). Growth of China’s Urban Middle Class: It’s Impacts on the Social and Economic Development. Working Paper. Middlesex University Business School.

Majumder, S. C., Rahman, M. H., & Martial, A. A. A. (2022). The Effects of Foreign Direct Investment on Export Processing Zones in Bangladesh using Generalize Method of Moments Approach. Social Sciences & Humanities Open, 6(1), 100277.

Mehdi, S., Zaroki, S. & Shahryar. N. (2012). The Study Examining the Effect of Export Erowth on Economic Growth in Iran, Business Intelligence Journal, 5(1), 21-30.

Moazzem, K. G., Islam, M., & Raz, C. S. (2014). Bilateral Free Trade Agreements (FTAs) Opportunities and Challenges for Bangladesh - Framework Issues. CPD Working Paper 107.

Morrison, W. M. (2015). China-US Trade Issues. Congressional Research Service (CRS) Report No. 7-5700.

Mukherji, R., & Pandey, D. (2014). The Relationship between the Growth of Exports and Growth of Gross Domestic Product of India. International Journal of Business and Economics Research, 3(3), 135-139.

Nufile, A. A. M. (2019). An Analysis of the Trade Relationship of Sri Lanka with Bangladesh after Trade Liberalization. Journal of Business Economics, 1(1), 78-82.

OEC (2022). Bangladesh (BGD) and Afghanistan (AFG) Trade. Retrieved from:

Pitigala, N. (2005). What Does Regional Trade in South Asia Reveal about Future Trade Integration? Some Empirical Evidence, World Bank Policy Research Working Paper 3497. Washington DC, the World Bank

Prabir, D., & Bhattacharyay, B.N. (2007). Prospects of India–Bangladesh Bilateral Economic Cooperation: Implications for South Asian Regional Cooperation, ADBI Discussion Paper 78.

Raihan, S., & Ashraf, F. (2017). Review of Bangladesh’s Engagement in Preferential Trading Arrangements. Country Study Series No.1 for the Development Account project Enhancing the Contribution of Preferential Trade Agreements to Inclusive and Equitable Trade. Bangkok: ESCAP

Rahapakse, P., & Arunatilake, N. (1997). Would a Reduction in Trade Barriers Promote Intra-SAARC Trade? A Sri Lankan Perspective. Journal of Asian Economics, 8(1), 95-115.

Rahman, S. H., & Ibon, W. F. (2019). Bangladesh’s Trade with Asia. The Bangladesh Development Studies, 42(1), 1-22.

Rahman, M. M., & Kim, C. (2016). Prospects for Economic Integration of BIMSTEC: Trade and Investment Scenario. International Journal of u- and e- Service, Science and Technology, 9(4), 235-248.

Rahman, M., Shadat, W. B., & Das N.C. (2006). Trade Potential in SAFTA: An Application of Augmented Gravity Model. Tradw Working Papers 22296. East Asian Bureau of Economic Research..

Raihan, S., & De, P. (2013). India-Pakistan Economic Cooperation: Implications for Regional Integration in South Asia. Working Paper. Commonwealth Secretariat. London.

Rashed, M. S., & Ashraf, U. N. (2016). Doing Business in and with China: The Challenges are Great, but so are the Opportunities. Global Journal of Management and Business Research: B Economics and Commerce, 16(2), 11-18.

Sikdar, C., Raa,T.T., Mohnen, P., & Chakraborty , D. (2006). Bilateral Trade between India and Bangladesh: A General Equilibrium Approach, Economic Systems Research, Vol. 18, No. 3, 257–279.

Sampathkumar, T., & Rajeshkumar, S. (2016). Causal Relationship between Export and Economic Growth: Evidence from SAARC Countries. IOSR Journal of Economics and Finance (IOSR-JEF), 7(3). 32-39.

Sunil, K. C. (2021). Nepal-Bangladesh Relations: Beyond Bilateralisms, AIDIA. Retrieved from:

Taguchi, H., & Rubasinghe, D. C. I. (2019). Trade Impacts of South Asian Free Trade Agreements in Sri Lanka. South Asia Economic Journal, 20(1), 1-18.

Tahir, M., Estrada, M. A. R., Afridi, M. A. (2019). Foreign Inflows and Economic Growth: An Empirical Study of the SAARC Region. Economic Systems, 43(3-4), 100702.

Yadav. S. K. S., Ali. N. M., & Nedelea, A. M. (2016). Formal Trade between India and Bangladesh: An Empirical Analysis. Ecoforum, 5(2), 23-34.

Zaheer, R. (2013). The Economic Performance of SAARC7 Member Countries. Research on Humanities and Social Sciences, 3(5), 201-2014.

Zahoor Ahmad Rather, Dr. Deepika Gupta. (2014). India-Bangladesh Bilateral Trade: Problems and Prospects. International Affairs and Global Strategy, 22, 42-48.

Full Text: PDF

DOI: 10.15408/etk.v21i2.24353


Copyright (c) 2022 Md. Abu Issa Gazi, Abdullah Al Masud, Rezuan Ahmed Shuvro, Md. Abdul Hakim, Mobarak Hossain

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.