Renowned economists at a discussion on Wednesday laid emphasis on forming a trilateral platform involving the government agencies, think tanks and private sector to create a regional industrial value chain connecting Bangladesh, Japan and Northeast India.
Highlighting that the region can become a major growth centre by overcoming challenges, they said establishing industries, infrastructures and energy links in the region would require massive investments, reforms to the trade policies and taxation, products harmonization and removing non-tariff barriers.
State Minister for Foreign Affairs Shahriar Alam who joined as the chief guest said Bangladesh helped Northeast India's peace and stability, while taking a visionary decision of establishing the country's first deep sea port.
"Now it is time to further advance the regional industries and development," he said.
Japanese Ambassador to Bangladesh Iwama Kiminori and FBCCI President Mahbubul Alam also spoke at the seminar on improving regional connectivity and establishing industrial value chain in the the Bay of Bengal including Bangladesh and Northeast India, organized by the Japanese Embassy in Dhaka.
Japan, a major foreign direct investor in Bangladesh, is supporting the establishment of Matarbari Deep Sea Port, a power plant and road and rail connectivity linking the port.
Japan is also working to accelerate industries and infrastructure along the Dhaka-Chattogram- Cox's Bazar belt and beyond under a $6-billion worth Bay of Bengal Industrial Growth Belt (BIG-B) initiative since 2014.
Japan is also supporting India building the infrastructure and industries in Northeast India.
"An industrial value chain in the region is very much a need of the day," said Prof Dr Prabir De of the Research and Information System for Developing Countries.
As there will be many actors and factors that should be involved in the process, he suggested that Bangladesh, India and Japan come under a trilateral framework cooperation agreement for advancing the creation of the regional industrial value chain.
Centre for Policy Dialogue Distinguished Fellow Dr Debapriya Bhattacharya said while this is very much a possible and important idea, but it faces some of the challenges that need to be addressed.
"One needs to keep in mind if the project cost is overrunning," he said.
Noting of the Matarbari Deep Sea Port that will be complete by 2026, Dr Debapriya said it is important to assess the demand of the port, if there will be enough cargoes coming to the port for its best utilisation. Actions should be taken now to create that demand.
He said while setting up necessary industries in Bangladesh and Northeast India is important, one also needs to think of how Nepal and Bhutan can be connected to the value chain.
"Matarbari without connecting Nepal and Bhutan cannot be Matarbari," he said.
Debapriya said often competitive advantage is shaped by geopolitical issue. India is a federal system and the foreign and trade relations are determined by Delhi. This issue also needs to be taken into account.
"Whether Japan will relocate its industries from China to Bangladesh will also be a factor," the economist said.
Joining virtually, India-based Asian Confluence Executive Director Sabyasachi Dutta said Japan has already developed many connectivity infrastructures in Northeast India and Bangladesh but much more needs to be done.
Development of multimodal connectivity between Matarbari and Chattogram of Bangladesh to Sabroom and Agartala of Tripura including four-lane highway and railway can be a game changer, he said.
He suggested removing trade barriers between Bangladesh and India, as well as Japan.
Signing Comprehensive Economic Partnership Agreement between India and Bangladesh, improving investment climate, smooth movements of goods across the border, facilitating third country trade should be some of the priorities, he added.