The Bihar Post

Seamless Transport Connectivity Can Create Significant Economic Gains for India and Bangladesh: WB report

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NEW DELHI—Seamless transport connectivity between India and Bangladesh has the potential to increase national income by as much as 17 percent in Bangladesh and 8 percent in India, says a new World Bank report.

Titled “Connecting to Thrive: Challenges and Opportunities of Transport Integration in Eastern South Asia”, the report analyses the Bangladesh-Bhutan-India-Nepal (BBIN) Motor Vehicles Agreement (MVA),  com­pares it with international best practices and identifies its strengths as well as gaps for seamless regional connectivity.

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The report also discusses regional policy actions the countries can take to strengthen the MVA and proposes priorities for infrastructure investments that will help the countries maximize its benefits.

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 Today, bilateral trade accounts for only about 10 percent of Bangladesh’s trade and a mere 1 percent of India’s trade. Whereas, in East Asian and Sub-Saharan African economies, intraregional trade accounts for 50 percent and 22 percent of total trade, respectively.

Previous analysis indicates that Bangladesh’s exports to India could increase by 182 percent and India’s exports to Bangladesh by 126 percent if the countries signed a free trade agreement. This analysis found that improving transport connectivity between the two countries could increase exports even further, yielding a 297 percent increase in Bangladesh’s exports to India and a 172 percent increase in India’s exports to Bangladesh.

“Geographically, Bangladesh’s location makes it a strategic gateway to India, Nepal, Bhutan, and other East Asian countries. Bangladesh can also become an economic powerhouse by improving regional trade, transit and logistics networks,” said Mercy Tembon, World Bank Country Director for Bangladesh and Bhutan.

“While trade between India and Bangladesh has increased substantially over the last decade, it is estimated to be $10 billion below its current potential. The World Bank is supporting the Government of Bangladesh to strengthen regional and trade transit through various investments in regional road and waterways corridors, priority land ports, and digital and automated systems for trade.”

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