Written by The Banking Post
Bangladesh’s trade deficit with China widened sharply by nearly 23 per cent to Tk 2.54 trillion (about $20.66 billion) in FY2024–25, driven largely by strong imports of industrial raw materials.
Data from Bangladesh Bank show total outflows to China reached Tk 2.685 trillion during the year, far exceeding inflows of just Tk 143 billion—highlighting the persistent imbalance in bilateral trade.
Around 80 per cent of trade between the two countries consists of goods, while services trade also expanded, rising more than 19 per cent year-on-year. However, the services segment saw a widening deficit as well.
Outflows in services—including payments related to foreign workers—climbed to Tk 3.374 billion, compared to inflows of about Tk 1.0 billion, resulting in a deficit of Tk 2.34 billion, nearly doubling from a year earlier.
The presence of Chinese nationals in Bangladesh’s infrastructure and development projects has contributed to higher outward payments under services.
Business leaders say imports from China remain strong due to cost advantages and flexible payment terms. Anwar Alam Chowdhury Parvez said companies continue to rely on Chinese suppliers for raw materials and semi-finished goods as they are competitively priced and often come with deferred payment options.
He added that lower shipping costs and shorter delivery times compared to other regions further strengthen China’s position as Bangladesh’s primary sourcing destination.
Industry insiders note that Chinese-backed infrastructure projects in Bangladesh are also boosting demand for imported machinery, equipment and related services.
Economists point to structural factors behind the widening gap. Zahid Hussain said Bangladesh has struggled to diversify exports to China despite enjoying full duty-free access since December 2024.
“Export growth has remained limited, even with preferential access, which continues to weigh on the trade balance,” he said.
