Lok Sabha Question No. 2879 (UNSTARRED), answered on 2026-03-10
Subject: Impact of US-Bangladesh Trade Agreement
Ministry: COMMERCE AND INDUSTRY
Asked by: Shri Sribharat Mathukumilli

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE AND INDUSTRY DEPARTMENT OF COMMERCE

## LOK SABHA UNSTARRED QUESTION NO.2879 ANSWERED ON 10/03/2026

## IMPACT OF US-BANGLADESH TRADE AGREEMENT

2879. SHRI SRIBHARAT MATHUKUMILLI:

Will  the  Minister  of COMMERCE AND INDUSTRY ( वाणिज्य एवं उद्योग मंत्री )  be  pleased  to state:

- (a) whether the Government is aware of the recent U.S.-Bangladesh arrangements providing preferential or zero-tariff access in certain cases;
- (b) whether the Government has studied the potential impact of Bangladesh shifting to U.S.sourced  cotton  and  textile  inputs,  under  its  recent  trade  arrangement  with  the  United States, on India's cotton farmers, spinning mills and yarn exporters and if so, the details and key findings thereof;
- (c) whether the Government has held any negotiations or discussions with the United States to secure similar or equivalent market access for Indian textile and garment exporters and if so, the details and current status thereof; and
- (d) whether the Government proposes to waive off or reduce the import duty on U.S. Cotton to enable Indian garment exporters to avail similar preferential access to the U.S. market and if  so, the details thereof?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्यमंत्री ( श्री जिजिन प्रसाद ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI JITIN PRASADA)

- (a)  Government  is  aware  of  the  US-Bangladesh  Agreement  on  Reciprocal  Trade  signed  on  9 February 2026.
- (b) India holds largest share in Bangladesh's cotton yarn imports and retains a structural advantage due  to  Bangladesh's  limited  domestic  spinning  capacity.  However,  Bangladesh's  imports  of  raw cotton from the United States is likely to be insufficient to substitute for the large volumes of yarn currently sourced from India.

The recent trade agreement between Bangladesh and the United States may marginally increase demand  for  U.S.  cotton,  any  competitive  pressure  is  likely  to  be  absorbed  primarily  by  other suppliers. India's cotton trade with Bangladesh may continue to benefit considering the geographical  proximity,  lower  freight  costs,  shorter  transit  times,  established  supply  chains,  and long-standing industry linkages, which provide resilience to the bilateral trade relationship.

- (c)  &  (d)  India  and  the  United  States  announced  a  trade  deal  on  2 nd   February  2026.  A  Joint Statement for the same was released on February 07 2026. The 25% additional ad valorem tariffs imposed by the U.S. on certain India's exports citing India's imports of Russian oil were removed. Pursuant to US Supreme Court judgement dated 20th February 2026 invalidating reciprocal tariffs, these tariffs are no longer in force. The US Government has issued Executive Orders imposing 10% tariffs  on  all  countries  on  certain  products.  The  Government  is  studying  all  the  developments thereafter for their implications and remains engaged with the US Government.

*****