Bangladesh has signed an Economic Partnership Agreement with Japan, marking its first-ever EPA with any country and a milestone in its trade relations with a developed economy.
The agreement was signed in Tokyo at 3:00 pm Japan Standard Time by Bangladesh’s Commerce Adviser, Sk. Bashir Uddin and Japan’s State Minister for Foreign Affairs, HORII Iwao, Commerce Secretary Mahbubur Rahman said.
Rahman said the agreement will come into force once the formal notification is published, which is expected to be issued shortly. He described the deal as a significant achievement for Bangladesh, noting that it is the country’s first comprehensive EPA with a developed nation.
Furthermore, the first such agreement Japan has signed with any least developed country. Attracting greater Japanese investment into Bangladesh was cited as a central objective of the agreement.
Prior to this, Bangladesh had only one preferential trade agreement, signed with Bhutan and in effect since December 2020. The Council of Advisers approved the Japan EPA on January 22, with a focus on securing long-term tariff benefits as Bangladesh prepares for its graduation from the Least Developed Country category later this year.
Under existing arrangements, Japan provides duty-free market access to LDCs on 97.9% of tariff lines, according to Bangladesh Customs, with exclusions covering 197 items such as rice, sugar, fisheries products, and leather goods.
Following the EPA signing, Bangladeshi exporters are set to receive duty-free access to around 97% of their export basket to Japan, including ready-made garments, a key sector for the country.
Automobiles from Japan will not receive duty-free entry under the agreement, Rahman said. He added that this exclusion is intended to encourage Japanese companies to invest directly in Bangladesh’s automotive sector, potentially supporting the development of local vehicle manufacturing. Japan is home to major global automotive brands such as Toyota and Honda.
Japan is Bangladesh’s second-largest export destination in Asia. Exports to Japan reached $1.33 billion in the 2024–25 fiscal year, reflecting an 8.2% year-on-year increase, according to data from Bangladesh Bank.
Key export items include ready-made garments, fish, shrimp and prawns, home textiles, jute products, leather goods, raw jute, and handicrafts.
During the same fiscal year, Bangladesh imported $1.87 billion worth of goods from Japan, resulting in a trade balance in Japan’s favor.
Major imports included iron and steel, vehicles and vehicle parts, ships and boats, and machinery such as nuclear reactors, boilers, and mechanical appliances, which together accounted for more than 60% of total imports from Japan, Bangladesh Bank data showed.
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