On February 9, 2026, the United States and Bangladesh reached a definitive Agreement on Reciprocal Trade, marking a transformative moment for the economic landscape of South Asia. This legally binding pact, signed in Dhaka by U.S. Trade Representative Jamieson Greer and Bangladesh’s Commerce Adviser Sheikh Bashir Uddin, significantly alters the trade dynamics between the two nations. The cornerstone of the deal is a reduction in the U.S. “reciprocal” tariff on Bangladeshi exports from 20 percent to 19 percent. While this rate is slightly higher than the 18 percent recently granted to India, the agreement includes a highly specific and valuable “zero reciprocal tariff” mechanism. Under this framework, a defined volume of textiles and apparel from Bangladesh will be allowed to enter the American market duty-free, provided these products are manufactured using U.S.-produced raw materials like cotton and synthetic fibers. This “circular” trade model is designed to encourage Bangladesh to shift its sourcing toward American farmers, potentially offering a massive competitive edge to its ready-made garment sector, which remains the backbone of the national economy.
In exchange for these concessions, the interim government led by Chief Adviser Muhammad Yunus has agreed to provide unprecedented market access for American exporters, effectively opening up a consumer base of 175 million people. Bangladesh has committed to purchasing approximately $3.5 billion in U.S. agricultural products, including wheat, soy, and corn, alongside a massive $15 billion energy procurement plan for American liquefied natural gas (LNG) over the next 15 years. Furthermore, Biman Bangladesh Airlines is set to modernize its fleet by purchasing 14 Boeing aircraft, with options for additional orders. Beyond these commercial transactions, the deal addresses deep-seated non-tariff barriers; Bangladesh will now recognize U.S. Federal motor vehicle safety standards and FDA certifications for pharmaceuticals and medical devices. The agreement also includes robust commitments to uphold international labor rights, prohibit forced labor, and implement stricter environmental protections. By aligning with Washington’s regulatory and strategic standards, Bangladesh has not only secured a vital economic lifeline but has also positioned itself as a primary strategic partner in the Indo-Pacific trade corridor just days before its national elections.
