Written by The Banking Post
The interim government led by Muhammad Yunus earned praise for holding a credible general election on February 12. But just days before handing over power, it signed a far-reaching reciprocal tariff agreement with the United States — a move that is now drawing intense scrutiny.
The deal, inked three days before the polls, committed Bangladesh to large-scale imports of US goods, including aircraft from Boeing, as well as wheat, soybeans, cotton, oil and LNG worth billions of dollars. In return, Washington offered conditional tariff concessions, particularly for ready-made garments, provided those products use US cotton and man-made fibre.
The agreement followed a 37 per cent reciprocal tariff imposed by US President Donald Trump on Bangladeshi exports, later reduced to 20 per cent after negotiations and finally trimmed by another percentage point under the deal. Bangladesh was not alone; several US trade partners signed similar agreements, many containing non-disclosure clauses and commitments to increase imports of American goods.
Legal twist in Washington
The landscape shifted dramatically last week when the Supreme Court of the United States ruled that tariffs imposed under the International Emergency Economic Powers Act were illegal. In response, Trump announced a temporary 15 per cent surcharge on imports while exploring alternative measures.
The ruling has raised a critical question: if the original tariff framework no longer stands, what becomes of Bangladesh’s agreement, which was based on a 19 per cent rate? For now, exports face a 15 per cent duty — potentially without the binding import commitments signed earlier.
Analysts note that many countries may hesitate to withdraw from such deals for fear of retaliation, even if the legal basis has weakened. Others that have not signed agreements are currently subject only to the 15 per cent surcharge, without additional obligations.
Why the rush?
Critics argue the interim administration could have left the decision to an elected government. The agreement was negotiated largely under the stewardship of Dr Khalilur Rahman, now foreign minister in the new administration led by Tarique Rahman. His prominent role in the talks — and subsequent inclusion in the cabinet — has sparked debate in political circles.
Commerce officials were reportedly less involved in the core negotiations, leaving key questions about the speed and scope of the final agreement.
Parliament’s role
Under Article 145A of the Constitution, international agreements must be placed before Parliament through the President. Past governments have often sidestepped detailed parliamentary scrutiny. The new parliament, set to begin its session on March 12, now has an opportunity to break from precedent.
Given the evolving legal context and the scale of financial commitments involved, many argue the trade deal should be debated openly. Whether the government revisits, revises or upholds the pact may ultimately depend on that parliamentary decision.
