Dhaka: President of the Chinese Enterprises Association in Bangladesh (CEAB), Han Kun, has underlined the importance of finalizing a Free Trade Agreement (FTA) between Bangladesh and China at the earliest possible time, saying it would unlock greater trade, investment, and long-term cooperation between the two countries.
According to Bangladesh Sangbad Sangstha, Han stated in an exclusive interview that the economic cooperation between Bangladesh and China has already deepened significantly, and a proper FTA would serve as a crucial institutional framework to further enhance bilateral opportunities. 'Many Chinese manufacturing companies are coming to Bangladesh because of its favorable investment environment,' he noted, adding that the delay in concluding the FTA is a concern for potential investors.
Han elaborated that Chinese investors are confident in Bangladesh's stable growth, with private investment in the power sector increasing by around 8 gigawatts in recent years, of which approximately 54 percent, or roughly 4 GW, has come from Chinese investment. Within the total installed capacity of around 27-28 GW, Chinese companies account for a significant portion, he added.
He pointed out that one key concern for Chinese firms in the manufacturing sector is the potential constraint on raw materials and equipment imports through Bangladesh's ports. 'If the FTA could be signed sooner, these challenges would be eased and investment flow would be accelerated,' he observed.
Han acknowledged that some stakeholders remain cautious because Bangladesh currently runs a significant trade deficit with China, as it imports far more from China than it exports. A 2025 analysis shows that Bangladesh has yet to fully utilize the zero-duty access offered by China due to limited product diversification and export capacity. However, he urged that this short-term imbalance be viewed in a long-term, strategic light: 'Some believe that signing an FTA may result in a greater influx of Chinese products into Bangladesh. But, in the long run, it will help Bangladesh become a global export hub leveraging China's strong manufacturing base.'
He noted that China already accounts for about 30 percent of global manufacturing capacity. According to Han and CEAB data, Chinese firms have significantly contributed to Bangladesh's infrastructure development through power, transport, and industrial zone projects, which has not only increased Bangladesh's physical capacity but also reduced the social and economic costs of development.
'Chinese companies play a vital role in giving Bangladesh access to low-cost equipment, semi-products, and technologies that can help the country build export-oriented manufacturing,' he mentioned. The CEAB president called for the Bangladeshi and Chinese governments to expedite both the FTA and an updated bilateral investment treaty. Talks on upgrading the investment treaty are already underway.
In its July 2024 joint statement, both sides announced the completion of a feasibility study on the FTA and agreed to begin negotiations on the investment agreement. 'We hope both governments will expedite the process for signing the FTA and updating the investment treaty to ensure faster and smoother cooperation,' Han said. He also emphasized the critical need for policy stability and credibility in Bangladesh to nurture investors' confidence.
Han remarked: 'There must be policy consistency and government credibility, not only for Chinese communities but for all foreign investors.' Bangladesh and China marked the 50th anniversary of diplomatic relations in 2025, underscoring the long-standing bilateral ties.
China has become one of Bangladesh's largest trading partners, and its investment footprint is growing. According to data from March 2025, Chinese foreign direct investment (FDI) stock in Bangladesh stood at $2.67 billion as of September 2024. China's infrastructure investment under the Belt and Road Initiative (BRI) has assisted Bangladesh in power, roads, tunnels, and industrial parks; for instance, China is reported to be implementing 21 bridge projects and 27 power/energy projects in Bangladesh.
On the trade side, Bangladesh enjoys some duty-free/quota-free access to China as part of the Asia Pacific Trade Agreement (APTA) and China's LDC scheme, but only about 61 percent of Chinese tariff lines are currently covered. Han emphasized that an FTA would shift the relationship into a higher gear.
He concluded: 'Bangladesh is not only a domestic market. It can become an export-driven manufacturing hub, leveraging China's capacity, capital, and technology. With the right framework, Bangladesh stands to gain enormously.'
Founded in 2004, the CEAB now counts around 250 member companies operating in Bangladesh across infrastructure, ready-made garments, textiles, logistics, and aviation sectors. Roughly half of the membership comes from the infrastructure sector, about 30 percent from ready-made textiles, and the rest from trading, logistics, and airlines. Han mentioned that about 20 Fortune Global 500 companies, also Chinese companies, have a presence in Bangladesh through subsidiaries or branches - many of them clustered in infrastructure and power.