Dhaka will sign the much-awaited TICFA with Washington only after getting assurances that Bangladeshi apparels would be granted duty-free access to the US market.
It will also address fully the long-debated labour issues in industries across the country, a cabinet committee decided last week.
Even if the US, the largest single export destination for Bangladeshi products, declines to offer the duty-free entry to its $200 billion plus apparel market, Bangladesh will be ready to introduce labour rights, including that of freedom of association 'gradually'. The word, gradually, within the quote will be inserted in the draft deal for implementing the labour standards.
A cabinet committee on TICFA, headed by finance minister AMA Muhith decided on the two alternate positions last week.
The decision came amid mounting pressures from
the United States Trade Representative (USTR), rights groups and the American Federation of Labour and Congress of Industrial Organisations (AFL-CIO) for introducing labour rights and improving safety standards in the garment units after a devastating fire last month at Tazreen Fashion in Savar that claimed 112 lives.
However, the US declined to accept none of the two proposals, top officials in the ministry of foreign affairs (MoFA) and the ministry of commerce(MoC) told the FE on Monday.
The Cabinet Committee on Trade and Investment Cooperation Framework Agreement (TICFA) held its meeting last Wednesday at the conference room of the ministry of finance. Senior ministers of foreign, commerce and labour and employment ministries and top officials of the ministries concerned attended the meeting.
A high official, who attended the meeting, said the decision taken was largely similar to the position of MoFA in this regard as the ministry also favoured signing of the framework agreement only after the US assures Bangladesh of providing duty-free market access of the latter's apparels to its vast market.
"An alternative proposal mooted by the MoFA on signing of the TICFA was also decided at the meeting in case the first option is rejected by our counterpart," a senior government official told the FE.
He, however, said Muhith paid no heed to the opinions of the ministries of commerce and labour and employment as the top representatives of the two ministries were in favour of signing the deal keeping the labour issues incorporated in the draft agreement unchanged.
"It is a unique situation while two administrative ministries dealing with trade and labour issues stand ready to accept labour clauses in the TICFA deal to avoid negative consequences in the US market and beyond. MoFA opts for 'give and take' strategy," the official, preferring anonymity, said.
He said the US has so far signed TICFA with over 70 countries and economic blocks without any conditions tagged.
The USTR has recently asked the Bangladesh government to implement labour standards in manufacturing sector and improve the country's poor safety records to avoid possible scrapping of GSP (generalised system of preference) facility now available for some of the country's export items to the US market.
The facility, however, excludes major items like clothing, frozen food, leather and jute goods. Bangladesh's garment export to the US in 2011 was nearly $4.5 billion.
The signing of much-talked-about TICFA has been stalled for over three years as Dhaka continued softening labour issues included in the draft, which the US denied. The USTR Office sought to include words like 'freedom of association of workers', 'effective recognition of workers' right to engage in collective bargaining,' 'elimination of child labour as well as discrimination in respect of employment and occupation," a top trade official said.
On the contrary, Dhaka has been pressing Washington to include the words 'to protect the fundamental labour rights, adherence to ILO (International Labour Organisation) conventions and internationally-recognised practices on labour issues' instead of 'freedom of association of workers and their right to engage in collective bargaining.'
Meanwhile, US Ambassador in Dhaka Den Mozena in two separate meetings with commerce minister GM Quader and foreign minister Dipu Moni categorically mentioned that there was no scope to tag any condition with signing of the TICFA, a high official said.
"Ambassador Mozena categorically said that indifferent attitude of Bangladesh towards signing of the TICFA that includes labour issues in its text gives a wrong signal to the stakeholders in the US that Dhaka is not serious to allow labour unions and improve other standards including safety in its industrial units," a high official, who attended the meeting, told the FE.
"The issue of duty-free access may come after signing of the framework agreement,: the official, quoting the Ambassador, added.
Bangladesh Ambassador to the US Akramul Quader in a recent letter sent to the MoFA advised Dhaka to accept the labour issues included in the draft deal to avert any negative consequence in the case of trade relations with the US.
"Our mission is of the view that we should not be rigid on labour issues included in the draft bilateral agreement between Dhaka and Washington for brighter trade prospects with the largest economy in the world", said the communication made by Quader.
Asked, commerce secretary Mahbub Ahmed declined to comment on the issue, but said, "We are working on TICFA."
It is learnt that the MoC is set to meet Prime Minister Sheikh Hasina soon for a final decision on TICFA.