New Delhi – The United States has initiated a trade investigation involving 16 countries, including India, China, and Bangladesh, to assess whether their policies and production methods could impact U.S. manufacturing. According to Dhaka-based The Morning Star, the inquiry in Bangladesh seeks to evaluate potential risks posed by its export practices.
The investigation, launched Wednesday under the Trade Act of 1974 by the Office of the United States Trade Representative (USTR), is a powerful enforcement tool used to challenge unfair foreign trade practices. The USTR report highlights evidence of structural overcapacity and high production levels in Bangladesh, which currently maintains a trade surplus of approximately $6.05 million with the U.S.
Much of this surplus comes from the textile sector, where the Bangladeshi government provides cash incentives to boost exports across 43 product categories, including garments and leather goods. The USTR also noted that Bangladesh’s cement industry retains significant unused capacity despite years of decline; national consumption fell to 38 million tons in 2024, less than 40% of total capacity, with further reductions expected.
Mahmud Hasan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association, expressed concern over the country being on the investigation list, saying it “does not send a positive signal.” However, the report indicated that the areas under review—such as production capacity, intellectual property, and export incentives—are unlikely to significantly affect Bangladesh.
The report emphasized that Bangladesh’s production is largely driven by international orders, limiting excess output. Additionally, the country has recently updated its labor laws in line with International Labour Organization (ILO) recommendations and ratified three key ILO conventions.
In preparation for graduating from the Least Developed Country (LDC) category this November, the Bangladeshi government has also begun phasing out export incentives gradually.
