Bangladesh-UK Bilateral Relations : An Ever-Growing Friendship

Political

Bangladesh and the UK have historic and traditional friendly ties that predate 1971. Regular contact between Bengal and Great Britain began in the 17th Century. In many ways, relations with Bengal-one of the most prosperous regions on earth at the time- were economically and politically important to Britain in the immediate aftermath of the preliminary phase of the Great Industrial Revolution. The relations also proved to be important to the region that constitutes today’s Bangladesh as it offered the population an opening to the West’s modern education, technology and ideas. Support of the British people, government and the media during Bangladesh’s War of Liberation in 1971 forged the relations further and took it to a new height. The UK was among the first of the European countries to recognize Bangladesh on February 4, 1972. This greatly influenced quick recognition of Bangladesh by other Commonwealth and Western countries. Bangladesh became a member of the Commonwealth on 18 April 1972. Bangladesh attaches great importance to the historic links binding the two important Commonwealth countries. Relations between Bangladesh and the UK are defined by their shared aspirations for democracy, development and human rights. A vibrant trade and economic partnership and the presence of a large Bangladeshi Diaspora in the United Kingdom (numbering about half a million) provides huge impetus to the burgeoning relations. The two countries have been maintaining excellent bilateral relations in all areas of mutual interest. Britain was one of the first countries to have offered warm, congratulatory words at the successful holding of the national election, 2008 in Bangladesh. Wishing Prime Minister-elect Sheikh Hasina success, health and long life Prime Minister Gordon Brown, in a telephone call, conveyed ‘’I hope the important ties between Britain and Bangladesh will further strengthen in the future...’’

The two countries work closely in various international forums on a range of issues including MDGs, climate change, human rights and UN peacekeeping as well as on issues related to the LDCs. Bangladesh is the second largest recipient of British overseas development assistance after India. The depth of the Bangladesh-UK relations is also manifested in the number of bilateral visits that have so far taken place between the two countries at various levels including Heads of State. The frequent high-level contacts of recent years have come to characterise the forward looking, diverse and multifaced relations. Starting from a level of mere aid centricity the two countries today look at the relations as a ‘new special partnership’ forged on ‘shared agenda’.

Trade

Trade, investment and broader economic relations between the two countries have expanded in depth and dimension over the years. The UK is the 3rd single largest destination for Bangladesh’s exports, after the United States and Germany. Bangladesh’s exports to the UK enjoys a steady annual growth of around 15.3% and comprises some 10% of Bangladesh’s total export. Total Bangladesh export to the UK in 2007-08 fiscal year was USD 1.47 billion.

UK-Bangladesh trade statistics are encouraging in terms of volume and growth. This may be attributed to, inter alia, competitive edge in quality and price; duty free access under EBA (Everything But Arms) scheme; enhanced compliance (specially in the RMG sector) with standards; strong backward linkage in knitwear and the High Commission’s regular initiatives.

One, however, might be concerned that a huge percentage of our total exports to UK consists of only readymade garments. Despite withdrawal of restrictions on Chinese export of textiles to EU from 1st January 2008, export of RMG from Bangladesh to UK has increased during 2008. It might, however, become difficult to sustain this growth and achieve export target unless the export basket is diversified.

Export items from Bangladesh to the UK also include knitwear, woven garments, shrimps, home textile, bi-cycle, light engineering products, vegetables, frozen fish, ceramic tableware, jute yarn and jute goods. Import items from the UK include power-generating and industrial machinery and equipments, professional and scientific equipments, textile fibres, medicinal and pharmaceutical products, dyeing, tanning and colouring materials, electrical machinery and appliances and chemical materials and products.

A focussed, sustained effort is needed to project the fact that Bangladesh has many more products to offer besides the traditional items that the UK presently imports from it. The UK may add to its import basket from Bangladesh, for example, ceramics, pharmaceuticals and computer

software, as well as medium and small sized ships, an emerging manufacturing product of Bangladesh. Some European countries including Denmark, Germany and the Netherlands are currently procuring sea-worthy vessels from Bangladesh.

Investment

UK has emerged as one of the biggest sources of FDI for Bangladesh. British investment registered in Bangladesh in 2008 was to the tune of USD 205 million, elevating UK to the top position among countries investing in Bangladesh. Major areas of British investment in Bangladesh include oil and gas, tea garden, financial and other service sectors. So far, about 190 units of British FDI projects have been registered with the Board of Investment of Bangladesh with a total investment outlay of US$ 2,150 million. An analysis of sector-wise distribution of the FDI proposals indicates that British investment in Bangladesh is heavily concentrated (72%) on sectors such as oil and gas exploration, coal, telecom etc. So far 10 UK companies have invested in the EPZs with an investment outlay of US$ 31.2 million.

Some of the major British concerns present in Bangladesh include Aventis, Berger Paints, BOC Bangladesh, British American Tobacco, Cairn Energy, Duncan Brothers, GEC, GlaxoSmithKline, GCM Energy, HSBC, James Finlay, Meghna Energy, P&O Nedlloyd, Price Waterhouse Coopers, Reckitt Benckiser, Standard Chartered, Tetley, ACI, Tullow Bangladesh, Unilever and World-Tel.

Full potential of British investment in Bangladesh is yet to be exploited. It needs to be indicated that Bangladesh is now widely billed as one of the most attractive investment destinations in the region. The country has liberalized its economy to an extent that has surpassed many of its neighbours. She offers attractive incentives to foreign investors including foreign ownership without limit, legal protection to investors against nationalization and expropriation, generous tax holidays and unrestricted repatriation of capital and profits. Bangladesh is also home to the most inexpensive, productive and easily trainable labour force. Besides, Bangladesh’s geographical location with well-established connectivity to the region, makes it a strategic location for foreign investors.

Economic Cooperation

For Bangladesh, the UK has, of late, emerged as the largest bilateral development partner and for the UK, Bangladesh is the second largest recipient of development assistance, next only to India. UK’s development programme has been a core area of international cooperation for Bangladesh and they are growing consistently in size and diversity. Total UK assistance to Bangladesh since independence has been £1,992.3 million, out of which £691.86 million was provided as project aid and technical assistance.

Good development performance has been an inspiring factor for the UK to continually increase its country ODA to Bangladesh. Over the past three years, the UK spent more than £350 million in development projects aimed at poverty alleviation, rural infrastructure development, primary education, health, nutrition, population, sanitation, safe drinking water, urban development, support to private sector infrastructure building and institutional reform. The current policy orientation of DFID’s development assistance programme goes well with the present priorities of Bangladesh for her socio-economic development.

DFID has been providing assistance to Bangladesh’s development programme in line with Poverty Reduction Strategy Papers (PRSPs), which is primarily focused on achieving the MDGs. DFID may be involved in other areas like construction of highway, bridges, rural road network, development of inland waterways (including dredging) and shipping and port development. Such an approach may help Bangladesh attain faster economic growth.

Construction of the ‘’Bangladesh-British Friendship Bridge’’ on the river Meghna has been a significant event in UK-Bangladesh economic relationship. British Government provided funding for a major portion of the expenditure for construction of the bridge.

The nature of British ODA to Bangladesh has also undergone remarkable changes over the years. In Bangladesh’s post-independence period, assistance was provided primarily in the form of food aid, commodity aid and technical assistance. The recent focus of the current British assistance programme in Bangladesh has been on human and institutional development as well as on good governance through implementation of different development projects. British assistance to the NGOs working in Bangladesh, both the indigenous ones and the NGOs affiliated with the British NGOs, has also been substantial.

Climate Change Cooperation

Climate Change cooperation has been an important element in the relationship between Bangladesh and the UK bilaterally as well as at international level. Bangladesh is particularly vulnerable to climate change given that it is a lowlying delta in one of the highest rainfall areas of the world.

The UK Government is a strong advocate for an environment-friendly global climate change regime. The British Foreign Secretary during his visit to Bangladesh in February 2008 showed deep understanding of the problem that Bangladesh was faced with due to climate change for which Bangladesh was hardly responsible. The British Foreign Secretary agreed to enhance cooperation with Bangladesh in this field.

Bangladesh supported a UK initiated debate at the UN Security Council on ‘Climate Change and Security’ in April 2007. Bangladesh deeply appreciates leadership displayed by Prime Minister Gordon Brown at global level on climate change issues and his interest to support the African and Asian LDCs in combating adverse impacts of climate change.

Bangladesh and the UK jointly organised the London Climate Change Conference held on 10 September 2008. The Conference was organized primarily to highlight Bangladesh’s strategic plans to mitigate climate change affects as well as to help bolster its adaptation programmes. The London Conference also established a Multi-Donor Trust Fund for Bangladesh. The UK Government pledged £75 million to the Trust Fund.

Bangladesh has been campaigning for renewed efforts to promote ‘carbon-neutral’ economic growth and for setting up a Technology Transfer Board as part of the next agreement on climate change. Bangladesh feels that the LDCs would not be able to attain sustainable development without access to affordable, eco-friendly technologies.

DFID has been supporting the Government of Bangladesh for devising a comprehensive strategy and project plan for shorter and longerterm adaptation. It would provide an additional fund of £30 million for the next three years under the Comprehensive Disaster Management Programme to help build Bangladesh’s capacity in enhancing disaster preparedness, including building cyclone shelters and other infrastructures.

Counter-Terrorism Cooperation

The UK in one of the leading partners of the Usled global war on terror and has been working closely with the US in Iraq and Afghanistan. The UK has also been a direct victim of terrorist attack during London bombings in 7/7. Bangladesh and the UK enjoy close cooperation in this particular area. The extent of cooperation includes training and information sharing.

British-Bangladeshi Diaspora in the UK

It is estimated that about half a million British-Bangladeshis today live in the UK, some of whose ancestors came to the UK before World War I. They occupy an important place in the evolving Bangladesh – UK relations primarily because of the close link the members of the community maintain with Bangladesh in terms of social/family engagements as well as business and investment interests. The British-Bangladeshis played a pivotal role in mobilizing international public opinion in favour of Bangladesh’s War of Independence in 1971. Due to their relentless efforts, London emerged as an epicentre of support activity for Bangladesh at that time. The community in Britain contributes significantly to the British economy as well. They run some 10,000 restaurants (thus forming the mainstay of British curry industry) that are largely manned by people of Bangladeshi origin. These restaurants employ about 90,000 workers with an annual turnover of around £3.5 billion.

British-Bangladeshis also send significant amount of remittance contributing to Bangladesh’s foreign exchange reserve and national economic development efforts. The UK is currently the 5^th largest source of foreign remittance for Bangladesh, next to Saudi Arabia, the US, the UAE and Kuwait. Remittance from the UK to Bangladesh in the last fiscal year was to the tune of USD 896.13 million, which was 11.33% of Bangladesh’s total foreign remittance received in the year.

The community has earned for itself a respectable position in the mainstream British society with a large number having been awarded the titles like Member or Order of the British Empire (MBE or OBE) in recognition of their contributions to the British society. They are also proactive in mainstream British politics with about 75 Bangladeshi Councillors from mainstream parties. A good number of British-Bangladeshis are expected to contest the next general elections in 2010.

The Bangla ethnic media in the UK is one of the world’s oldest and largest Bangla media and has earned a leading reputation with 4 TV channels and over 12 Bangla and English ethnic dailies. These are doing a commendable job of creating awareness amongst the second and third generation British-Bangladeshis about Bangladesh and its culture. The third generation Bangladeshi students are achieving brilliant academic feat in British secondary and higher education, an achievement being recognized by the High Commission each year through the ‘Achievement Award Ceremony’.

Cultural Cooperation

Bangladesh has a rich cultural tradition covering all aspects and forms of finer living and expression. Her culture is influenced by three world religions- Hinduism, Buddhism and Islam in successive order. Like a colourful montage, the cultural tradition of the country is a happy blending of many variants, unique in diversity but in essence greatly symmetrical. The cultural ties between UK and Bangladesh are gaining momentum as well. The colourful annual Brick Lane Festival, the Banglatown International Curry Festival and the Baishakhi Mela at Trafalgar Square and East London celebrating Bangla New Year on 14 April every year are events, among others, that are forging common grounds between the British Bangladeshi community and the mosaic of cultural diversity of Great Britain.

Defence Partnership

Historically there has been a strong and spontaneous influence of British legislation and the English language on Bangladesh’s civil, judicial, academic and military institutions drawing the two peoples on a common intellectual platform. Right from the very inception of Bangladesh, defence and security cooperation between Bangladesh and the UK has been warm and intense. The UK’s continual support to provide all out assistance in developing and training Bangladesh Armed Forces is well marked. A good number of Bangladeshi Armed Forces personnel are trained in UK every year at the Sandhurst Royal Military Academy, Royal College of Defence Studies and at the Joint Defence Command Staff Courses. UK has also provided significant military and advisory assistance in setting up the prestigious Defence Services Command and Staff College and the National Defence College (NDC) of Bangladesh. British Military Assistance Team had been in Bangladesh as instructors for many years. The two Navies are also cooperating closely while most of the ships of Bangladesh Navy (BN) have been procured from Royal Navy thereby facilitating BN achieve commendable capability. Royal Navy has also provided technical advice in setting up important BN infrastructure such as BN Dockyard. The two armed forces have also been working closely in UN Peace-keeping missions and in the global war on terror. Exchange of high profile military visits has also been a hallmark of defence cooperation between the two countries. This excellent cooperation is expected to grow in the future.

Bangladesh High Commission in London plays a central role in adding speed and substance in the burgeoing relations. The High Commission takes a lead role in safeguarding and furthering the interests of Bangladesh as well as that of the community in Great Britain. The High Commission’s areas of activity include all major spheres namely political, economic, trade and investment.