JAKARTADAILY.ID – Indonesia and Bangladesh have successfully concluded the 4th round of negotiations for the Indonesia-Bangladesh Preferential Trade Agreement (IB-PTA) in Bandung from May 16 to 19, 2023. The negotiations resulted in the completion of almost the entire agreement, marking significant progress in this year's negotiations.
Leading the Indonesian delegation was Johni Martha, the Director of Bilateral Negotiations at the Directorate General of International Trade Negotiations. Noor Md Mahbubul Haq, the Head of the Foreign Trade Agreement (FTA) Wing of the Ministry of Commerce of Bangladesh, led the Bangladeshi delegation. The negotiations were attended by Indonesian Ambassador to Bangladesh Heru Hartanto Subolo and other representatives from relevant ministries and agencies.
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"Both parties have a shared understanding of the importance of completing the IB-PTA in line with the directions of our respective heads of state. The resumption of face-to-face negotiations after the last round in 2019 reflects the enthusiasm of both delegations to conclude the IB-PTA negotiations this year," stated Johni.
During this round, the Indonesian and Bangladeshi delegations reached agreements on nearly the entire text of the IB-PTA, including discussions on the Rules of Origin and Operational Certification Procedure (OCP). The two countries also adjusted their work plan for the negotiations, providing a joint guide to continue and finalize the discussions.
Johni emphasized that expanding market access through preferential tariffs within the IB-PTA framework is expected to boost Indonesia's exports to Bangladesh and contribute to post-pandemic economic recovery. Bangladesh is an important trading partner for Indonesia in the South Asian region.
"The completion of 97 percent of the agreement's text represents significant progress in expediting the IB-PTA negotiations. Indonesia and Bangladesh will now focus on finalizing discussions on market access to ensure a balanced and mutually beneficial agreement for both countries," added Johni.
The IB-PTA negotiations began in 2019 and have undergone three rounds thus far. The delegations from both countries will reconvene in July 2023 to finalize the entire text of the agreement. The target is to sign the IB-PTA in late August or early September 2023.
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According to data from January to March 2023, the total trade between Indonesia and Bangladesh amounted to USD 915.1 million, reflecting a 15.95 percent decline compared to the same period the previous year. Indonesia's exports to Bangladesh stood at USD 889.8 million, while imports from Bangladesh reached USD 25.3 million. In 2022, the total trade between the two countries reached USD 4 billion, with Indonesia exporting USD 3.8 billion worth of goods to Bangladesh and importing USD 110 million, resulting in a surplus of USD 3.7 billion for Indonesia.
Bangladesh is Indonesia's 24th-largest export destination and 68th-largest import origin. Key Indonesian exports to Bangladesh include palm oil, coal, portland cement, chemical wood pulp, and artificial staple fibers. Meanwhile, the main imports from Bangladesh to Indonesia consist of t-shirts, jute fiber yarn, women's suits, men's suits, pockets, and bags.
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