The National Board of Revenue has informed the Indian High Commission in Dhaka that offering Tripura tea duty-free market access by Bangladesh was not possible for protection of the local tea industries.
The revenue board on Tuesday conveyed the decision to Indian High Commissioner to Dhaka Riva Ganguly Das at her meeting with NBR chairman Md Mosharraf Hossain Bhuiyan at the NBR office in Dhaka.
The NBR made the decision after taking opinions from stakeholders including tea producers, trade bodies and relevant government agencies following a plea made by India seeking duty-free market access for tea from its northeastern state of Tripura to Bangladesh.
Stakeholders including Bangladesh Tea Association and Bangladesh Tea Board opined that the local tea sector would be affected badly if the government allowed Tripura tea duty-free market access, officials said.
At the meeting, the both sides also discussed some other Indian proposals including withdrawal of port restriction on import of 19 products, particularly through land customs stations including Akhaura-Agartala integrated check post on Tripura-Bangladesh border and offering tax and VAT exemption for some projects being implemented by Indian contractors.
The products include, among others, tea, electric and electronic items, paper, cashew nuts and handloom products.
Officials said that the items for which India sought withdrawal of port restrictions were allowed to be exported to Bangladesh through many other land customs stations on other border areas.
The NBR may consider lifting the restriction on some products after consultation with stakeholders including importers, they said, adding that it would be difficult to lift the bar on some products as there were no adequate testing and storage facility at LCS on the border.
India on several occasions sought the relaxation of port restrictions on the products.
In the latest, the country raised the issue along with seeking duty-free tea export facility prior to the August 20-21 visit of its foreign affairs minister Subrahmanyam Jaishanker.
Bangladesh Tea Association, a platform of the local tea growers, on August 24 in a letter requested the NBR chairman not to accept the Indian proposal of duty-free Tripura tea export. It argued that the benefit would destroy the local industry and put negative impact on lives and livelihood of tea workers.
Bangladesh produced 82.13 million kilograms of tea in 2018 against domestic demand for 90.45 million kilograms in the year.
Till July 2019, Bangladesh imported 5.59 million kilograms of tea and 65 per cent of the volume came from India, according to the association.
In addition, the local market has already been flooded with smuggled tea from Tripura and other parts of India, it said.
Currently, 92 per cent duties and taxes are applicable to import of tea in the country. India also imposes 104 per cent duty on tea import.
Officials said that a number of bilateral customs issues including relaxation of port restrictions, review of negative list of import and export through LCSs would be solved before the upcoming India visit of prime minister Sheikh Hasina.
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