The smooth and cordial diplomatic relations between Nepal and Bangladesh made way for stronger trade ties. Over the years, both the nations built mutual trust and strengthened relationship by not only opening doors to economic and trade opportunities but also encouraging people to people contact. For speedy trade exchanges, immigration offices were opened on the Fulbari-Banglabandha border area, located on India and Bangladesh border.
The episode of economic cooperation between Kathmandu and Dhaka began in April 1976 with the singing of four agreements covering the area – trade, transit, civil aviation, and technical cooperation. As a consequence, in the following year (September 1997) Bangladesh Government allowed the Nepalese government to use the port facilities at Mongla Port since. As a result a Joint Economic Commission (JEC) was set up in 1978 between the Finance Ministers of both the nations.
Dr. Mohammad Tarikul Islam, a Associate Professor of Government and Politics at Jahangirnagar University, Bangladesh, in his article titled Bangladesh-Nepal Trade Relations: Influences of Economic Diplomacy highlighted the potential economic benefits the two nations could gain from with increase in its trade agreements. He said, “Though Bangladesh and Nepal enjoy strong relations, the volume of bilateral trade has been much despite tremendous potentials for expanding and diversifying trade between the two countries…the economic logic is to strengthen trade and transit between Nepal and Bangladesh, little has happened so far other than policy concessions which seem different from the ground reality.”
Besides working on ways to increase trade opportunities, the two nations need to bring India in the picture as it is between them territorially. The two nations set apart by 22km of Indian land piece, are dependent on India to wipe out bureaucratic and infrastructural challenges. Nepal’s local demands are dependent on about 90% of goods import, a market currently dominated by India, but presents a lot of opportunities for Bangladesh. Whereas Bangladesh’s growing economy, conducive to foreign investment, offers great investment opportunities for Nepal.