Dhaka, Delhi close to investment deal

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India and Bangladesh are in the final stages of negotiations for a Bilateral Investment Promotion Agreement (BIPA) which is expected to be clinched soon.

This emerged after a three-hour talk between foreign secretaries of India and Bangladesh Shivshankar Menon and Touhid Hossain at the Hyderabad House yesterday.

Briefing reporters after the talks, which were also held over a working lunch, Menon and Hossain said BIPA “is in final stages [of negotiations] and it would be clinched soon”.

They also said the joint technical committee on river embankment would meet soon in view of the seriousness of the problem of soil erosion along the river banks affecting India and Bangladesh.

The BIPA would provide national treatment for foreign investment, most favoured nation treatment for foreign investment and investors, free repatriation or transfer of returns on investments and recourse to domestic disputes resolution and international arbitration for disputes.

The bilateral investment promotion pact, which really took off after India lifted the ban on the flow of investment from Bangladeshi citizens and corporate houses in November last year, is expected to give a push to investments from both sides, official sources said.

The ban on investment from Bangladesh had been imposed for security reasons and although it was lifted nine months ago, investment proposals from Bangladesh would still need prior clearance of the Foreign Investment Promotion Board even if they are meant for sectors which India has put on the automatic route.

The curb on investment flow from Bangladesh was removed also because India could not have signed the bilateral investment promotion agreement with a country from where it did not permit any investment to come in, officials pointed out.

India would have had to withdraw the restrictions even under the South Asian Free Trade agreement, they contended.

Several big Indian companies, including the Tatas, whose three billion dollar investment proposal for Bangladesh is hanging fire for more than four years, and the Essar, have evinced keen interest in putting their money in India’s eastern neighbour.

Menon and Hossain said all aspects of bilateral relations were discussed at the foreign secretary-level meeting.

“The discussions were forward-looking and constructive,” they said.

Bilateral trade and connectivity also came up for discussion, the two top diplomats added without elaborating.

Asked about India finding the links of Bangladesh-based terror outfit Harkatul Jihad al Islami (Huji) to a number of terror attacks in India in the recent past, Hossain said terrorism was a global issue and it has to be tackled.

Hossain led a six-member delegation of Bangladesh which also included that country’s High Commissioner to India Liaqat Ali Choudhury.

Indian High Commissioner to Bangladesh Pinak Ranjan Chakrabarty was a member of the host side at the talks.

Bangladesh urged India to reduce the huge trade deficit of nearly $2 billion by allowing greater access of Bangladeshi products to the Indian market, news agency UNB adds.

Touhid emphasised the need for creating conditions for increasing two-way trade.

He requested expediting the completion of export of the remaining 5 lakh tonnes of rice to Bangladesh. He also requested his counterpart to consider completely withdrawing restrictions on the export of rice from India.

Dhaka also called for expediting work to reach agreement on the sharing of the waters of the common rivers, particularly the Teesta, at the Foreign Office Consultations between the two countries, which began in New Delhi yesterday morning.

The discussions on connectivity also focused on better utilisation of the Protocol on Inland Water Transit and Trade, improvement of border infrastructure to facilitate trade, and the need for approaching specific issues through relevant forums.

Last year had been productive in bilateral relations, Menon said referring to the launch of Indo-Bangla Moitree Express.

COOPERATION IN TERROR CONTROL
India yesterday sought Bangladesh’s cooperation in tackling terrorism “resolutely”.

“The discussions were very useful and led to much greater understanding of each other’s position,” Foreign Secretary of India Shivshankar Menon said.

The Indian side raised the issue of terrorism allegedly emanating from Bangladeshi soil and sought Dhaka’s cooperation in curbing such activities.

Describing terrorism as a global problem, Touhid Hossain said the two countries have the mechanism of home secretary-level meetings to address it.

Agreeing with Menon, Touhid said the talks were “candid” and “forward-looking” and Bangladesh did not shy away from discussing any issue that is important for the present and the future.

“Terrorism has to be tackled resolutely,” Menon said, adding, “We look forward to working together against terrorism.”

Menon said security of the two countries is inter-linked and they should join hands on the issue.

He said home secretaries of the two countries will meet soon to discuss ways to tackle terrorism together.

For India, strengthening relations with Bangladesh is one of the highest priorities, Menon said.

He said Indian Army Chief Gen Deepak Kapoor will soon visit Bangladesh.

Touhid Hossain said he invited Menon to Bangladesh.

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