Bangladesh's trade deficit with India inched up by 13.23 percent in the first half of the current fiscal year (July 2005-June 2006), The Daily Star reported Sunday.

The country's trade deficit with India in the first half of FY06 was 1.07 billion U.S. dollars, which was 945 million dollars in the corresponding period of FY05.

However, according to official statistics, the country's export to India in the first half of FY06 posted an encouraging 42 percent rise from the corresponding period of FY05, compared to a 14.85 percent rise in import from the next-door neighbor.

Bangladesh's export to India in July-December 2005 was 105 million dollars compared to 74 million dollars in the first half of FY05.

On the other hand, its import from India in July-December FY06 was 1.18 billion dollars, or about 170 million dollars higher than the 1.01 billion dollars import in July-December FY05.

The daily quoted Commerce Ministry sources as saying that the hike in export volume this fiscal year was due mainly to the duty- free access of 91 products to the Indian market and elimination of a few non-tariff barriers.

Of the products enjoying duty-free access, readymade garment, polythene sheet, plastic hanger, toiletries, glass and machine parts have contributed most in the export growth.

During her recent visit to India, Bangladeshi Prime Minister Khaleda Zia sought duty-free access of more Bangladeshi products from the Indian government to reduce the huge bilateral trade gap. To achieve that, New Delhi suggested signing a free trade agreement between the two neighboring economies.

According to the daily, some non-tariff barriers like mandatory testing required by India, inadequate banking facility and poor infrastructure at land ports are also hindering the country's export growth to India.

Source: Xinhua