Bangladesh Resumes Rice Trade with Pakistan, Secures 50,000-Tonne Deal

For the first time since gaining independence in 1971. Bangladesh has re-established direct trade ties with Pakistan. It has secured a 50,000-tonne rice import deal under a government-to-government agreement. The move signals a shift in regional trade relations, allowing both nations to explore new economic opportunities after decades of limited interaction.

Strengthening Diplomatic Relations Drives Trade Resumption

This new trade agreement follows improving diplomatic relations since the Interim Government, led by Mohammed Younus, took charge in August 2024 after the removal of former Prime Minister Sheikh Hasina. The political transition has facilitated economic engagements, leading to Bangladesh sourcing rice from Pakistan after years of reliance on Vietnam, India, and Thailand for imports.

Previously known as East Pakistan, Bangladesh became independent after a nine-month war. While trade relations remained strained for decades. This direct rice procurement deal suggests a positive shift in bilateral economic cooperation, potentially paving the way for further trade agreements between the two countries.

Rice Import Details and Pricing

Under the agreement, Bangladesh will purchase white rice from Pakistan at $499 per tonne through the Trading Corporation of Pakistan (TCP). The first batch of 25,000 tonnes is set to arrive this month, while the second batch is expected in early March.

However, Pakistani rice is priced higher than the Vietnamese white rice that Bangladesh has been importing at $474.25 per tonne, raising concerns about cost-effectiveness. Despite the price difference, Bangladesh appears to be diversifying its suppliers to avoid over-reliance on a single country.

Government Measures to Stabilize Rising Rice Prices

Over the past few months, rice prices in Bangladesh have surged by 15-20%, with medium-quality rice now selling at around 80 taka ($0,66) per kg. To control prices, the government has increased imports, issued new tenders, and removed import duties to ease supply pressure.

With rice being a staple food in Bangladesh, ensuring affordability and availability remains a top priority. By expanding its import sources, Bangladesh aims to stabilize prices, prevent shortages, and strengthen food security.

The success of this historic trade agreement could lead to further economic collaborations between Bangladesh and Pakistan, reinforcing regional trade ties after decades of limited engagement.

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