Executive Summary

Nowadays the business world is very much competitive. Previously people thought locally,
after that internationally and now globally. So competition increased and situations become
difficult day by day because perspective is changing. This report attempts to show the
emergence of policies, prospects and problems of the International Trade in Bangladesh.
Companies moving into international markets frequently duplicate the competitive strategies
that they have implemented in their home markets. This is again a relatively passive approach
to engaging in international business. For many companies, it may not be possible to alter
successfully their basic approach towards marketplace competition; however, it is still
important to evaluate beforehand whether the organization can successfully compete in
foreign markets in the same way that it is competing domestically. Expansion into one or
more foreign markets offers greater profit potential than other possible uses of the
organization's scarce resources. Managers often equate profit potential with the potential size
of foreign markets, as we shall discuss below; however, perhaps the most important
determinant of whether expansion into international markets is likely to be profitable is
whether the organization possesses competitive advantages that can be relatively easily
exploited in foreign markets. The cost of expanding into individual foreign markets will
depend upon how the organization chooses to compete in each market. It is difficult to
generalize about the factors that make one foreign market more desirable than another;
however, several rules-of-thumb apply when relating an organization's competitive advantage
to the attributes of foreign markets. If relatively detailed screening of potentially attractive
foreign markets leads to a preliminary conclusion that going international could well be a
profitable strategy, the next major stage in the analysis is to identify a relatively low cost
method of supplying the foreign market. 'Standard' competitive advantages identified in
Industrial Economies. These relate to other firms making a similar product in the same
market. Competitive advantages arising as a direct result of their international activities. The
process of strategic management focuses on how an organization gains awareness of and
determines its' purpose for being; its' objectives and aims; as well as the actual planning,
implementation and evaluation of how successfully the objectives were realized. Bangladesh
is a moderating influence in a consistently volatile and often mutually hostile South Asian
scenario. The current macroeconomic situation in the country is, by and large, stable,
characterized by a manageable fiscal deficit and a quite low current account deficit.
 CHAPTER: ONE
INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Trade is an integral part of the total developmental effort and national growth of all
economies including Bangladesh. It particularly plays a central role in the development plan
of Bangladesh where foreign exchange scarcity constitutes a critical bottleneck. International
trade can largely meet foreign exchange gap, and export growth would increase the import
capacity of the country that, in turn, would increase industrialization, as well as overall
economic activities. Bangladeshs import needs are substantial; hence the need to rapidly
increase exports is immediate. In order to finance the imports and also to reduce the countrys
dependence on foreign aid, the Government of Bangladesh has been trying to enhance foreign
exchange earnings through planned and increased exports.

However, the global trade scenario has exposed structural limitations of the Bangladesh
economy, posing a variety of challenges for the country that has under developed technology
and a low capital base. In the process, we examine Bangladeshs export and import
performance compared to various countries, regions and the world over the years. We also
discuss the sources of Bangladeshs imports and directions of Bangladeshs exports and the
dynamic changes over the years, and highlight the trends of export and import shares to GDP
and trade balance positions. International trade can introduce a company to whole new
foreign markets. Spreading risk in foreign markets and companies means that organization
wont only be subjected to the tribulations of the Bangladesh economy. This diversification
can shield their tradees from the investment risk of putting all their eggs in one basket.
Similarly, international traders are also ideally poised to take advantage of the higher than
usual potential for growth of some foreign economies. It is important to do our research right
to find the right emerging markets for our kind of tradees. Of course, it is also important to
balance these advantages against the likelihood for high costs and abrupt changes that are the
special risks of investing internationally. International trade holds many benefits for those
who are willing to put in the extra effort. As websites such as Export promotion Bureau
Bangladesh make it obvious, importing organizations are eager to make their infrastructures
available to new trading partners on a global scale, which is a sure sign that the time is ripe to
explore new opportunities.

1.2 OBJECTIVES OF THE STUDY

This paper has been prepared from the corner of two objectives are as follows:

1.2.1 Primary objective

To know the emergence of policies, prospects and problems of the International Trade
in Bangladesh.
To give a concrete idea about the export and import activities of Bangladesh through
presenting different products.

1.2.2 Secondary Objective

To know the various terms of export and import.

To know the present, past and potential or future trading of Bangladesh.

To know the balance of trade of Bangladesh.

To know the challenges facing Bangladesh in exporting and importing products and

services at present and recent.

It is known to all that, importing more goods and services than exporting for an economy
have continuous bad effect on its real growth. On the other hand, study of export and Import
of international trade provides a greater learning opportunity about varieties terms, policies,
rules of export and import, products, opportunities as well as the paths for trade expansion
throughout the world for maximizing profit. We strongly hope that our paper will provide lot
accurate and useful information that will help those who want to get an idea on export and
import condition of Bangladesh.

1.3 SPECIFIC PURPOSE OF THE STUDY

In this Term Paper, we have discussed the composition, performance, growth, impact and
trends of International trade of Bangladesh. This paper has been made to show the main
purpose that is as follows:

To fulfill partial requirements of course completion of the International Trade.

To obtain a strong knowledge that will help to work on trade at international level in

future.

1.4 RATIONALE OF THE STUDY

There are many factors that discourage local companies from going international and taking
their goods across the world. But the benefits of international trading far outweigh its
disadvantages. The global village is growing even closer, and this has made exporting a big
trade that grows exponentially every year, and benefits from improved logistics and
communication channels. Trade can gain some long lasting benefits from international trade.
Importing and exporting goods can help to broaden our horizons in the following ways:

Trading our products internationally can give us an advantage over competition. If the
domestic market is already flooded with similar products, then overseas markets may just be
the answer to better profitability. This holds especially true for products that arent widely
available overseas. As the international market for our good gets bigger, sales increase,
giving us an advantage over others in our industry.
 CHAPTER: TWO
CONCEPTUAL ISSUE

2.1 World Trade organization in International Trading

International trade has truly expanded to encompass most of the world over the past century.
The countries of the world have seen that everyone can benefit from specializing in the
production of a certain good or set of goods and by having skilled workers that provide
services to others. This trade off in strengths and weaknesses help get some commodities to
locations that would otherwise be unable to attain goods or services that they need. The world
of trading between countries is ever changing with the advancement in technology that
becomes available to countries.

The importing and exporting of goods across the globe is regulated by the World Trade
Organization (WTO). This, like many other organizations have multiple benefits and
drawbacks for the parties involved beyond practical application of rules and policies. One
major benefit of the WTO is that they allow for trading on neutral ground allowing neither of
the parties involved to obtain an unfair advantage during the trade agreement process. Any
disputes that arise between two or more trading parties are also handled by the WTO which is
also a benefit of having the organization in place. The organization itself acts as a mediator or
referee of sorts when it comes to the process of trade between nations across the globe. This
type of organization also has drawbacks when it comes to certain real world application in
certain aspect. Nothing is perfect but again some of its approaches to policy are only really
beneficial in theory. It seems as if the WTO organizations method of operation is trade
focused with little care as to the effects its agreements have on the populous of the countries
involved.

Four key points defined in the international trade simulation are the
Production possibility frontier.

Opportunity cost.

Absolute advantage.

Comparative advantage.
The production possibilities frontier is a curve that measures the maximum combination of
two products from a given number of available resources and current technology. If a
company was in trade producing laptop computers and HD television sets the resources are
the workers, conveyer machinery, and other materials for production. The production
possibilities frontier would depict a specified quantity produced if all resources were used to
produce only laptop computers on one end of the frontier and the specified quantity produced
if all resources were used to produce only HD television sets on the other side of the frontier.
Associated points and quantities would be plotted accordingly as the total quantity of one
product varies to produce the other. All combinations plotted on the frontier are attainable
maximizing the resources available. As more of one product is manufactured less of the other
product is produced. The opportunity cost of production is the highest valued alternative that
must be forgone to engage in the production of another product. The opportunity cost of
laptop computers to HD television sets would be the number of laptop computers that can be
produced by not producing HD television sets. In some instances an individual, firm, or
company can produce more of a good or service than their competitors using the same goods
and services, which is known as absolute advantage.

The World Trade Organization (WTO) is the only global international organization dealing
with the rules of trade between nations. The WTO has many trade topics, such as tariffs.
Customs duties on merchandise imports are called tariffs. Tariffs give a price advantage to
locally produced goods over similar goods, which are imported, and they raise revenues for
governments. The WTO allows countries to negotiate trade on neutral ground; they help
lower trade barriers and open markets for trade. Communication is difficult between
countries; the WTO also solves this by interpreting contracts so both parties understand, and
have a successful relationship. The WTO has helped increase trade and will continue to do so
in the future.

The simulation of the country of Roadmap tested the knowledge we have attained pertaining
to international trade. This demonstrated how even one decision can change the face of trade
between two countries and how each country can benefit from exchanging goods with one
another to help fill in where one country may be weak. We learned how tariffs can affect
imports, exports, and the balance of trade. This simulation shows the direct link between an
international trade decisions by a country and how it will affect its outcome financially as
well as any future interaction with that country. The result of this simulation is that there is
always going to be change when dealing with trade issues with other countries. There will be
up and down times that each country will face when attempting to trade a good or service
with another country. The World Trade Organization has been implemented to help countries
grow their economies by importing and exporting of goods. The bottom line in making any
decision when deciding what to trade with another country is to compare how the items being
traded are equaling out to one another.

2.2 Literature Review

The idea of trade between nations has been around for centuries. It began with trade routes
for silk, spices, and other commodities. It later began to include seafaring trading such as
cocoa from Central and South America being sent to Europe. Today the world of trade
includes anything that a person can conceive: grains, cotton, tobacco, spices, services,
components for making a good, and the list go on. The individual countries must weigh every
option and angle that is present when entering into a trade deal with other countries.
Bangladesh economy has passed through a heightened pace of global integration in the
1990s. The degree of openness of the Bangladesh economy is now higher than many
developing countries though international trade of Bangladesh is extremely small relative to
the size of its population.

"Foreign demands for goods are produced by home country". In national accounts "exports"
consist of transactions in goods and services (sales, barter, gifts or grants) from residents to
non-residents. A general delimitation of exports in national accounts is given below:

An export of a good occurs when there is a change of ownership from a resident to a non-
resident; this does not necessarily imply that the good in question physically crosses the
frontier. However, in specific cases national accounts impute changes of ownership even
though in legal terms no change of ownership takes place. Export of services consists of all
services rendered by residents to non-residents. In national accounts any direct purchases by
non-residents in the economic territory of a country are recorded as exports of services;
therefore all expenditure by foreign tourists in the economic territory of a country is
considered as part of the exports of services of that country. Also international flows of
illegal services must be included. National accountants often need to make adjustments to
the basic trade data in order to comply with national accounts concepts; the concepts for basic
trade statistics often differ in terms of definition and coverage from the requirements in the
national accounts:

Statistical recording of trade in services is based on declarations by banks to their central

banks or by surveys of the main operators. In a globalized economy where services can be
rendered via electronic means. Basic statistics on international trade normally do not record
smuggled goods or international flows of illegal services. A small fraction of the smuggled
goods and illegal services may nevertheless be included in official trade statistics through
dummy shipments or dummy declarations that serve to conceal the illegal nature of the
activities.

"Imports" consist of transactions in goods and services (sales, barter, gifts or grants) from
non-residents residents to residents.

A general delimitation of imports in national accounts is given below: An import of a good

occurs when there is a change of ownership from a non-resident to a resident; this does not
necessarily imply that the good in question physically crosses the frontier. However, in
specific cases national accounts impute changes of ownership even though in legal terms no
change of ownership takes place. Imports of services consist of all services rendered by non-
residents to residents. In national accounts any direct purchases by residents outside the
economic territory of a country are recorded as imports of services; therefore all expenditure
by tourists in the economic territory of another country are considered as part of the imports
of services. Also international flows of illegal services must be included. Basic trade statistics
often differ in terms of definition and coverage from the requirements in the national
accounts: Statistical recording of trade in services is based on declarations by banks to their
central banks or by surveys of the main operators. In a globalized economy where services
can be rendered via electronic means. Basic statistics on international trade normally do not
record smuggled goods or international flows of illegal services. A small fraction of the
smuggled goods and illegal services may nevertheless be included in official trade statistics
through dummy shipments or dummy declarations that serve to conceal the illegal nature of
the activities. Like many other third-world countries, Bangladesh relies quite heavily on
exports to provide for the needs of its densely populated nation.
 CHAPTER: THREE
DATABASE

3.1 FUTURE SCOPE OF THE STUDY

It is very known that, international Trade is considered as a big path for bringing a
revolutionary change in a countries economy as well as world. It may have some scope in
variety of ways for various users, persons or groups. The study is specifically focused on the
exporting and importing different products and its effect on the economy.

o This report will render a close past theoretical look at the export and import that have

been changed over time and may be used as historical data to decide for making

future action.

o The study will also help to know the reasons behind of growth of export in different

sector and also together increasing import of Bangladesh.

o The study will help to know the reasons of imbalance trading and its effect on

economy at the time.

o The study will help us to gather knowledge about the kinds of products & services are

exported or imported from different countries.

o It will assist to know the major products of exporting and importing are performed by

bangladesh.

3.2 METHODOLOGY OF THE STUDY

Data Collection
This research is basically descriptive in nature and from the secondary sources. Keeping the
background and the specific objectives in mind, related available information have been
collected through mainly secondary sources during the process which is utilized for finding
useful information on trading of Bangladesh.

Sources of primary data: Not available in this term paper.

Sources of Secondary Data:

o Official websites of Central bank of Bangladesh.

o Official websites of commerce ministry as well as concerned websites of government

and its agencies.

o Financial Journals.

o Bangladesh Trade Portals.

o Varieties Financial and Economic Magazines.

o Others websites related with finance trading, economics and banking industry of

international and domestic level.

3.3 LIMITATIONS OF THE STUDY

The paper has focused mainly on limited items of exported and imported products of
Bangladesh. Some limiting factors were faced while conducting process for preparing the
report. These factors are as follows:

o Particularly as we full time job holder so, time was really critical factor for us to

accomplish this report.

o We could not gather whole information of trading of given products equally standard

from the prospect of export and import.

o We have found it so critical to summarize information from different sources because

of some lack of understanding to this process though tried best with our level.

o We have found some data and information (year of 2014 as well as 2015) to the

different websites dissimilar from commerce ministry of Bangladesh government which

has led us to be confused on some particular term of trading of Bangladesh

internationally.