What should be done to improve bilateral ties which are almost suspended at the moment?
You have a new government in New Delhi and we'll have one in Bangladesh very soon. The first step obviously would be to try and have a meeting. There should be an exchange of visits—at the level of the foreign ministers or at least the foreign secretaries. We should take up all unresolved problems on a priority basis and, simultaneously, look at ways to expand economic ties.
Which issues demand immediate attention?
The two foreign secretaries, Salman Haider and myself, have had several meetings in the past year. After last year's SAARC summit when Haider came here, there was an understanding that we'll move quickly to a permanent sharing agreement on the Ganges waters. We were unable to move beyond that stage because both countries were looking at elections down the road. First and foremost, from our point of view, would be the water sharing. We are also keen to see reduction in tariffs that prevent more Bangladeshi goods from entering the Indian market and to have non-tariff barriers removed.
Why do you stress on that?
Because psychologically, it's important to have a level-playing field. After all, what can Bangladesh really sell to India? Maybe some consumer goods. At the moment, our consumer goods have no access to your market. You can sell chocolates and toothpaste here, but we can't sell any of them in India even if we wanted to. When I was in Delhi, I had extensive talks with P. Chidambaram, when he was commerce minister, and I.K. Gujral on this very subject. So both the new finance minister and the new external affairs minister are familiar with the problem. And I would like to think they are extremely responsive to the idea that Bangladesh should get better access.
What do you expect India to do?
What we've been asking for is eminently doable: that India give us duty-free access to its market; remove all duties on goods manufactured in Bangladesh. It's been shown that this would have little impact on Indian industry. But it will have an enormous psychological impact here. This is the only way we can make a dent in the growing trade imbalance—last year we estimated a $600 million trade balance on the official account in India's favour. If we add the goods smuggled in from India, we could be looking at figures close to $2 billion. In the last three years, I think Bangladesh has been the fastest growing market for Indian goods in the world. To preserve this market, there has to be some reciprocity and it will be at minimum cost to India.
We should be able to tell our people that India is sensitive to our concerns, that it's not simply out to exploit our market. Another thrust area is Indo-Bangladesh joint ventures. Apart from producing for our market and re-exporting, setting up industries here would also give you better access to the North-east. Which is my third point. When you give us market access, we may be able to sell little to West Bengal or to the rest of India. But we may be able to sell certain goods to the North-east because of the geographical advantage.
We are hoping to see some action from your new government within a period of weeks. We've been working on this for three years. We waited for SAPTA, and we are into its second round. If India wishes, under SAPTA, it can give these concessions to the least developed countries—Nepal, Bangladesh, Bhutan and Maldives.
I doubt that will correct the trade imbalance.
No, it won't. This has been run through the computers in Delhi. But in two years, our exports to India—which average about $40-50 million a year now—will double.
I doubt that will correct the trade imbalance.
No, it won't. This has been run through the computers in Delhi. But in two years, our exports to India—which average about $40-50 million a year now—will double.
There's a feeling in Bangladesh that India is indifferent to you. Do you agree?
That's a widely-held feeling. I must say I occasionally had that feeling in Delhi. We felt that on issues which were of paramount concern to us, India was just not willing to move fast enough, it didn't appear to show any interest in doing something. It could delay decisions indefinitely without any consequences. India was not suffering because of these problems, we were. I think there was also the feeling that India, being India, should be focussing on bigger issues and bigger countries, that it was a kind of first division player...and why should it waste time on Bangladesh.
Which bigger issues and which bigger countries?
Well, with the US and Russia and Europe. There is constantly a kind of yearning to look beyond the region. I've always argued that from purely selfish economic interests, you have a very big stake in your neighbourhood and I would urge India to focus here.
Then, there is a problem of style and perception. India had many domestic preoccupations and there was a feeling that Narasimha Rao was much happier not doing some things rather than doing some things, if he could avoid doing them. Khaleda Zia visited India in May 1992 and we had a promise from Rao that he would return that visit within a few months. But he never came. A lot of the momentum generated during that first meeting was lost. One of the vagaries of our ties is that you need a strong push from the top to get things moving.
Your trade imbalance with China is also large.
Market access is not really the problem there. The primary question is: what do we sell to the Chinese? Secondly, there isn't this geographical proximity factor. Thirdly, we don't have any bilateral problems with China. The Chinese have really gone out of their way to promote a number of projects, financed virtually free of cost. The feeling is that this relationship is much less iniquitous. Finally, we don't have this problem of smuggling. With China we may be looking at a $300 million trade surplus, with India it's double, minus the smuggling.
It's the World Bank and the IMF which forced Bangladesh to liberalise. India just took advantage.
Of course. But then, that doesn't prevent people from protesting loudly about the fact that our market is flooded with Indian goods.
Is there a consensus here on improving ties with India?
This is going to be a challenge to the new government. Such a consensus ought to exist and moreover can exist. Our relationship with India is a matter of national priority. It's in our own interest that we develop those relations rather than play politics with them and I think really the first job of the new government is to try and develop a national consensus. I think it is eminently doable.
Dhaka never specified how much Ganga water it needs.
That's not true at all. Before Farakka was commissioned in 1975, the average flow coming to us during the dry season was 55,000 cusecs. Even then, the feeling was that there wasn't enough water for all our needs. What we actually needed mid-March to mid-May was 75,000 cusecs. Now you build a barrage and do a test run. You say 'you (Bangladesh) take 44,000 and we will divert 11,000 to flush the Hooghly at Calcutta'. In '76 you use the barrage again. By our estimates, you divert substantial quantities of water and we immediately experience a series of problems. Navigation is affected, siltation takes place, fresh water supplies dry up in Khulna and Bagirhat, dry season irrigation is seriously affected and we see an immediate ingress in salinity all the way up to 100 miles and beyond.
This couldn't have happened in one year.
Well, we see the first signs of it. It was quite dramatic even in that first year. That's when we went to the UN. Then there was a change of government in India. Morarji Desai came in and in '77 we get the first Ganges water agreement. You gave us 34,500 cusecs and took 20,000. This worked effectively from '77 to '88. Throughout this period, we experience various problems. But somehow we get by. But in '88, the agreement is not renewed and the quantum of water available to us falls below 15,000 cusecs. The ecological impact has been quite dramatic during the last eight years. We really need the entire 55,000. We were told to take the water from the Brahmaputra, which was called a 'surplus river'. Fact is, we're using all the water there. Signs are that we'll be short of water even in Brahmputra five, ten years down the line.
In Delhi, I consistently argued that you could give us the full 55,000 cusecs at no cost to you. The justification behind Farakka was this building up of the Calcutta port for international shipping. In the last 20 years, Calcutta has become a purely domestic port. You have Haldia as the major eastern port. The requirement of flushing the Hooghly is no longer relevant. Today, at Calcutta port, their computers which tell them where the sand banks are building up and they use the dredgers.
River management has been quite poor in Bangladesh.
You have to discuss that with our experts. I am no expert on river management. All I can say is, we need every drop you can give us.
What about the issue of transit through Bangladesh?
There are those who feel India should never be given transit under any circumstances. That's one extreme position. Against that, there are people who say transit will be of greater benefit to Bangladesh than it would be to India. Tremendous revenues can be generated, so let's go ahead and do it, no questions asked. The government's stand is: before we get into this question, we have to create a climate which can enable transit to be discussed and acted upon. Simply stated, we have to see some tangible results on the water issue—without that you won't be able to create the necessary public opinion.
Then, let's take a more integrated, regional context. Transit is being discussed in the context of SAPTA. There are requests for transit from Nepal and Bhutan through India to Bangladesh. We would like to see better transit through India to Pakistan. The question is how do we open up this region and remove impediments to trade. We need better communications.
Do you think this is possible?
We've been trying to convince India to look at the possibilities. At the moment, it's an article of faith in India's foreign policy that all problems are to be addressed bilaterally, not regionally. I hope some of these positions which are part of the Indian foreign policy dogma become more flexible.
India is held responsible for its size. We are big.
Surely, you are big. This bigness can definitely work to your advantage. We say it's a market of 950-million people. That should be the approach, rather than looking upon India as a country trying to dominate us. It's a case of changing perceptions. If we can get the economic agenda moving, the political agenda will fall in place.
