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Usaid-Bangladesh Trade Facilitation Activity (Btfa) Study on Non-Tariff Barriers in Bangladesh to Agricultural Imports and Exports

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Usaid-Bangladesh Trade Facilitation Activity (Btfa) Study on Non-Tariff Barriers in Bangladesh to Agricultural Imports and Exports USAID-BANGLADESH TRADE FACILITATION ACTIVITY (BTFA) STUDY ON NON-TARIFF BARRIERS IN BANGLADESH TO AGRICULTURAL IMPORTS AND EXPORTS OCTOBER 2017 This report is made possible by the support of the American People through the United States Agency for International Development (USAID). The contents of this report were prepared by IBI International under Task Order number AID-338-TO-13-00002; REQ-338-13-000041. The views expressed herein are the sole responsibility of IBI International and do not necessarily reflect the views of USAID or the United States Government. Cover Photos: 1. Focus Group Discussion for the NTB Study; 2. Poor state at the Benapole port; 3. Damaged gantry crane at the Chittagong port; and 4. Traffic congestion at the Dhaka-Chittagong highway. BTFA Study on NTBs in Bangladesh to Agricultural Imports and Exports 1 USAID-BANGLADESH TRADE FACILITATION ACTIVITY (BTFA) STUDY ON NON-TARIFF BARRIERS IN BANGLADESH TO AGRICULTURAL IMPORTS AND EXPORTS October 2017 2 BTFA Study on NTBs in Bangladesh to Agricultural Imports and Exports TABLE OF CONTENTS Contents ACRONYMS ....................................................................................................................................................................... 4 EXECUTIVE SUMMARY .................................................................................................................................................. 6 SECTION 1: STUDY OBJECTIVE AND PROCEDURES ...................................................................................... 12 1.1 INTRODUCTION ................................................................................................................................... 12 1.2 SCOPE ........................................................................................................................................................ 13 1.3 METHODS OF DATA COLLECTION............................................................................................... 14 1.4 LIMITATIONS ........................................................................................................................................... 15 SECTION 2: NTBS THAT AFFECT BANGLADESH’S AGRICULTURAL TRADE ........................................ 16 2.1 INADEQUATE INFRASTRUCTURE AND CAPACITY CONSTRAINTS AT PORTS .......... 16 2.2 INFRASTRUCTURAL AND CAPACITY CONSTRAINTS IN STANDARDS AGENCIES ... 22 2.3 NTBS ARISING OUT OF PROCEDURAL OBSTACLES/ HURDLES (CUSTOMS & OGAs)27 2.4 OTHER NTBS ........................................................................................................................................... 30 SECTION 3: STEPS TAKEN TO IMPROVE THE SITUATION ........................................................................... 33 3.1 STEPS TAKEN BY CUSTOMS .............................................................................................................. 33 3.2 STEPS TAKEN BY THE SHIPPING MINISTRY ................................................................................ 34 3.3 STEPS TAKEN BY THE MINISTRY OF AGRICULTURE............................................................... 36 3.4 STEPS TAKEN BY THE BSTI ................................................................................................................ 37 SECTION 4: CONCLUSIONS AND RECOMMENDATIONS ........................................................................... 38 4.1 NTBS THAT AFFECT AGRICULTURAL TRADE ........................................................................... 38 4.2 STEPS TAKEN TO IMPROVE THE SITUATION ............................................................................ 40 4.3 RECOMMENDATIONS ......................................................................................................................... 41 APPENDICES: ................................................................................................................................................................... 44 Annex1: Questionnaires ................................................................................................................................ 44 Annex 2: List of Participants in the FGD ................................................................................................... 57 Annex 3: Newspaper Clipping on Benapole Port ................................................................................... 58 Annex 4: Letter Issued by Ministry of Agriculture Regarding Issuance of IPs .................................. 59 Annex 5: Specimen of CITES certificate .................................................................................................... 60 BTFA Study on NTBs in Bangladesh to Agricultural Imports and Exports 3 ACRONYMS ADB Asian Development Bank ARO Assistant Revenue Officer ASYCUDA Automated System for Customs Data AW ASYCUDA World BCSIR Bangladesh Council for Science and Industrial Research BFVAPEA Bangladesh Fruits, Vegetables & Allied Products Exporters Association BGB Border Guard, Bangladesh BIMAN Biman Bangladesh Airlines BLPA Bangladesh Land Port Authority BR Bangladesh Railway BSTI Bangladesh Standards and Testing Institution BTFA Bangladesh Trade Facilitation Activity BTMA Bangladesh Textile Mills Association CCF Chief Conservator of Forests CCI&E Office of the Chief Controller of Imports and Exports CCT Chittagong Container Terminal CCTV Close Circuit Television C&F Clearing and Forwarding CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora CM Certification of Marks COE Country of export (COE) COO Country of origin CPA Chittagong Port Authority DAE Department of Agricultural Extension DFO Divisional Forest Officer DLS Department of Livestock Services DPP Development Project Proforma ECNEC Executive Committee for National Economic Council EU European Union FGD Focus Group Discussion FIQC Fish Inspection and Quality Control FSAAI Food Safety and Standards Authority of India FSC Free Sale Certificate FSS Free Sale Statement FtF Feed the Future GCB General Cargo Berth GCMS Gas Chromatography Mass Spectrometer GoB Government of Bangladesh HPLC High Performance Liquid Chromatography HS Harmonized System HSIA Hazrat Shahjalal International Airport 4 BTFA Study on NTBs in Bangladesh to Agricultural Imports and Exports ICD Inland Container Depot ICT Information and Communication Technology ICP Integrated Customs Post IP Import Permit IPO Import Policy Order LC Letter of Credit LCL Loose Container Load LCS Land Customs Station MoC Ministry of Commerce MPA Mongla Port Authority MRL Maximum Residue Limit NBR National Board of Revenue NCT New Mooring Container Terminal NTB Non-tariff barrier NTM Non-tariff measure OCP Organochlorine Pesticide OGA Other Government Agency PCS Port Congestion Surcharge PRA Pest Risk Analysis SASEC South Asia Sub-regional Economic Cooperation SKU Stock Keeping Unit SPS Sanitary and Phytosanitary SRO Statutory Regulatory Order TBT Technical Barriers to Trade TEU Twenty-foot equivalent unit TFA Trade Facilitation Agreement UAE United Arab Emirates UNCTAD United Nations Conference on Trade and Development USAID United States Agency for International Development VTMIS Vessel Traffic Management Information System WCO World Customs Organization WTO World Trade Organization BTFA Study on NTBs in Bangladesh to Agricultural Imports and Exports 5 EXECUTIVE SUMMARY USAID Bangladesh Trade Facilitation Activity (BTFA) undertook this Study to identify and review the Non- Tariff Barriers (NTBs), in Bangladesh, to agricultural imports and exports. Agricultural traders in Bangladesh face difficulties in getting their products to export/ import markets and in sourcing agricultural supplies/ inputs/ equipment. Identification of NTB’s, and their costs, would therefore allow meaningful lobbying for their removal. The NTBs are basically categorized into two main forms: the non-tariff measures (NTMs) that arise as intentional or unintentional consequences of pursuance of trade policies by governments (e.g. sanitary and phytosanitary measures and technical barriers to trade), and the procedural obstacles that originate from the existence of inefficiencies in trade or customs administration systems, other government institutions, cumbersome trade documentation requirements, inadequate port and transport infrastructure, etc. As examination of NTMs associated with WTO Sanitary and Phytosanitary (SPS) or Technical Barriers to Trade (TBT) are covered in other donor-funded studies, to avoid duplication of efforts this Study did not include issues specific to application of NTMs. Instead it limited its focus on the NTBs, procedural or otherwise, that affect clearance and processing at-the-borders and behind-the-borders. The focus is, therefore, on those NTBs faced in Bangladesh by Bangladeshi exporters and importers in relation to trade in agricultural products. The Study thus provided an in-depth analysis of NTBs in Bangladesh that inhibits the country’s agricultural imports and exports, and contributes to delays and increased costs in trade in vegetables, agricultural and agro-processed products and foods. It also provided an examination of the initiatives undertaken by relevant government agencies aimed at removing or reducing some of those barriers or hurdles. As the methodology for conducting the review the Study adopted a qualitative research design. It used relevant information from both primary and secondary data. Desk research was conducted, using secondary documents/ publications for a basic understanding of relevant NTBs in
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