International Chamber of Commerce-Bangladesh (ICCB) has termed the BBIN (Bangladesh, Bhutan, India and Nepal) transport sector agreement as a catalyst for economic growth and development.
The BBIN initiative, officially launched in 2015, has created to tackle the logistic and economic challenges that have historically hindered South Asia's development, according to editorial of the current ICCB news letter of April-June period releaed on Thursday.
A key objective of the initiative including the BBIN Motor Vehicles Agreement (MVA), is to strengthen economic collaboration by unhindered flow of cross-border transport, trade of goods and services. The BBIN initiative can greatly lower transportation cost and transit time.
This is especially important for landlocked nations such as Bhutan and Nepal, which depend heavily on neighboring countries for easy access to sea and global markets. Improved connectivity can facilitate trade, investment, boost regional tourism, and create jobs, all of which will contribute to the economic growth of the region, the BBIN objectives say.
Bangladesh, India, and Nepal have ratified the 2015 Agreement, but Bhutan has not yet done so, mainly because of environmental concerns and infrastructure issues. However, Bhutan's recent participation in meetings as an observer suggests a possible interest in rejoining the initiative.
A key component of the initiative is BBIN Motor Vehicles Agreement (MVA), signed in 2015, which is designed to facilitate smooth cross-border vehicle movement and eliminate significant trade obstacles, such as complex border checks and inconsistent customs procedures which impeded trade efficiency.
By streamlining these processes, the BBIN agreement can expand market access, diversify trade, lower costs, and enhance competitiveness.
The ICCB bulletin said the TIR Convention (1975) allows global transit system, simplifies and secures international goods transport by guaranteeing customs duties and taxes. With 76 Contracting Parties, including China, India, and Pakistan, it offers a reliable method for cross-border trade while protecting member countries revenues.
Due to its strategic location, Bangladesh could become a key transit route for trade between northeast India and the rest of India, as well as provide better port access for Bhutan and Nepal. If integration occurs, as per CUTS International estimates the region's combined GDP could surpass $8.3 trillion by 2035.
As of August 2020, the Asian Development Bank (ADB) has invested over $15 billion through the SASEC program in transport, energy, trade, economic corridors, and ICT to enhance connectivity.
Given the significant investments in infrastructure, it's crucial for all countries to take decisive action to implement the BBIN and MVA Agreements. Bangladesh, Bhutan, and Nepal should also join the TIR Convention to improve port access for landlocked Nepal and Bhutan and facilitate cross-border vehicle movement.
