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India has indicated that it will allow Foreign Direct Investment (FDI) from Bangladesh. It is reviewing current restrictions placed on FDI from Bangladesh, and will allow investment on a case-by-case basis, Minister of State for Commerce Jairam Ramesh announced at the launch of the India-Bangladesh Chamber of Commerce in Dhaka, on July 22, 2007.
Ramesh said Bangladesh businessmen were keen to invest in pharma, paper, food processing and textiles in India. Indian businessmen too were eager to invest in Bangladesh, so a blanket ban on investment “made no sense,” the minister said.
India intends to set up testing facilities for hilsa fish at Petrapole, to do away with a non-tariff barrier. Bangladeshi businessmen have been pointing out that India's procedures for testing are laborious and constitute a non-tariff barrier. Six laboratories have been identified in Bangladesh for testing purposes.
India has also offered to buy 8 million garment items every year from Bangladesh. From January 1, 2008, 86% of Bangladesh's tariff lines will not attract any import duty in India.
For its part, India has been asking for more transit routes to northeast India and access to the new mooring terminal at Chittagong, both longstanding requests.
Ramesh also announced that the two countries would sign a mutual recognition agreement soon to enable them to assess each other's requirements.
July 23, 2007
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