US Overtakes India as Bangladesh’s Second-Largest Trading Partner

US Overtakes India as Bangladesh’s Second-Largest Trading Partner

The United States has overtaken India to become Bangladesh’s second-largest trading partner, driven largely by a sharp increase in imports from the United States. China continues to hold the top position by a wide margin.

Bangladesh’s imports from the United States increased by 43 percent in the latest fiscal year, while exports to the US rose by around 4 percent. At the same time, imports from India declined by about 7.5 percent and exports to India fell by roughly 3 percent.

According to National Board of Revenue data, Bangladesh’s total trade with the United States reached $12.67 billion in the latest fiscal year, compared with $10.72 billion with India. The difference was $1.95 billion in favor of the US.

US Trade Gains Momentum

The United States remains Bangladesh’s largest export market as a single country. In the 2024–25 fiscal year, Bangladesh recorded a trade surplus of $6.26 billion with the US.

That surplus narrowed to $5.55 billion in 2025–26 as imports from the US increased. During the period, Bangladesh exported goods worth $9.11 billion to the United States and imported $3.56 billion worth of goods.

The increase in imports came amid negotiations over US counter-tariffs on Bangladeshi products. Bangladesh subsequently increased purchases of several US goods, including wheat, energy products, soybean seeds and cotton. An agreement was also reached to purchase 14 aircraft from Boeing.

Under a Bangladesh-US trade agreement signed on Feb. 9, Bangladesh committed to purchasing agricultural products worth about $3.5 billion and energy products worth nearly $15 billion over 15 years. The agreement also included plans to increase purchases of aircraft and military equipment.

Imports From US Rise Sharply

Bangladesh’s imports from the United States increased from $2.49 billion to $3.56 billion, representing 43 percent growth.

Wheat imports, which were negligible in the previous fiscal year, reached $227.7 million. Soybean seed imports increased from $350 million to around $620 million, while cotton imports rose from $230 million to $380 million. Government-sector LNG imports also increased to nearly $480 million.

Despite the surge in imports, Bangladesh’s export growth to the US slowed. Exports increased 14 percent in 2024–25 but grew by only 4 percent in the latest fiscal year. Overall bilateral trade with the United States increased by about 13 percent.

Why Businesses Are Buying More From the US

Importers cited improved trade conditions, competitive prices, product quality and greater certainty of supply as key reasons for increasing purchases from the United States.

Business leaders also said disruptions and political tensions affecting trade with other countries have increased uncertainty, making US supplies more attractive in some cases.

Economist Mustafizur Rahman said the rise in imports, particularly through government procurement, was the main reason for the increase in overall trade with the United States. However, he noted that promised special concessions for Bangladesh’s garment exports had not yet been implemented.

India’s Trade Position Weakens

While trade with the United States has expanded, Bangladesh’s trade with India has declined amid worsening trade restrictions and strained bilateral relations.

Bangladesh suspended imports of yarn from India through land ports in March 2025. India later withdrew a facility that allowed Bangladeshi goods to be exported to other countries through Kolkata Airport.

India subsequently introduced restrictions affecting several Bangladeshi products, including garments, food products, jute goods, cotton waste, plastics and wooden furniture. These measures contributed to a decline in bilateral trade.

Bangladesh’s garment exports to India fell from about $650 million in 2024–25 to around $570 million in the latest fiscal year, a decline of nearly 12 percent.

Imports of textile raw materials from India also dropped. Cotton imports fell from $520 million to $400 million, while cotton yarn imports declined from $1.75 billion to $1.47 billion.

Trade Concessions Remain a Key Issue

Exporters said Bangladesh’s increased purchases from the United States were partly linked to expectations of reduced tariffs on Bangladeshi garment exports.

Mahmud Hasan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association, said higher imports from the US could help reduce the US trade deficit with Bangladesh and potentially lower the risk of additional tariffs.

He said discussions were expected on the structure of promised benefits for garment exports using US cotton, with hopes that implementation would help increase Bangladesh’s exports to the American market.

At the same time, he said both Bangladesh and India were losing from reduced bilateral trade. Because neighboring countries offer shorter transportation distances and lower costs, he argued that stronger trade between Bangladesh and India would benefit both sides.

China Remains Bangladesh’s Top Trading Partner

Despite the shift in the rankings of the United States and India, China remains Bangladesh’s largest trading partner.

Bangladesh’s total trade with China reached $22.96 billion in the latest fiscal year, more than twice its trade with the United States. Imports from China amounted to $22.14 billion, while exports were $820 million.

Bangladesh relies heavily on China for raw materials, machinery and other production inputs. The large difference between imports and exports has resulted in a substantial trade deficit with China.

Three Countries Account for Nearly 39 Percent of Trade

NBR data shows that Bangladesh recorded total imports of $73.12 billion and exports of $46.26 billion in the latest fiscal year, bringing total trade to $119.38 billion.

China accounted for 19 percent of Bangladesh’s total trade, followed by the United States at 11 percent and India at 9 percent. Together, the three countries accounted for nearly 39 percent of Bangladesh’s total international trade.

Economists note that imports from China and India include significant quantities of raw materials used by Bangladesh’s export-oriented industries. These materials are then processed into finished products and exported to markets around the world.