Bangladesh, the second-largest economy in South Asia in terms of GDP (current USD) [1] has sustained an average annual real GDP growth of 6.4% between 2010 and 2023. [2] The country successfully met the UN’s third LDC triennial review in March 2024 and is scheduled to graduate in November 2026.
Bangladesh is pursuing Economic Partnership Agreement (EPA), Preferential and Free Trade Agreements with key partners to address post-graduation challenges by reducing export barriers, protecting national trade interests, enhancing legal frameworks, attracting Foreign Direct Investment (FDI), and boosting high-value exports to strengthen its global competitiveness.
According to the export concentration index data published by United Nation’s Commodity Trade Statistics (UNCTAD) in 2025 the concentration ratio of Bangladesh’s export was 0.40 in 2024, which was more than double compared to 0.18 of LDCs and However, Bangladesh’s export concentration is higher than that of its competitor countries like India, Vietnam, Cambodia, and Indonesia. [3]
Although Bangladesh exported goods to 202 countries, its exports are remained highly concentrated in a few destinations in FY 2024–2025. [4] Only four markets—namely the EU (USD 21.39 billion or 44.29%), the United States (USD 8.69 billion or 18.00%), Canada (USD 1.46 billion or 3.03%), and Japan (USD 1.41 billion or 2.92%)—accounted for export earnings of USD 32,951.88 million in total, representing 68.25% of the country’s total export earnings during the period.
Limited export products and market access amplify the vulnerability of an economy to external shocks. To build resilience against external shocks and sustain higher economic growth, small states should diversify exports and reduce dependence on limited products. Diversification stabilizes export earnings and domestic output by mitigating adverse trade shocks. [5]
Bangladesh is exploring trade agreement with several trade blocs, including the Gulf Cooperation Council (GCC), to create greater trade opportunities, achieve national and international development goals, and address the challenges of the post-LDC era. GCC is a regional, intergovernmental, political and economic union comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE). The Charter of the GCC was signed on 25 May 1981, formally establish the institution.
Bangladesh and GCC Trade Relations
Bangladesh and GCC signed a Memorandum of Understanding (MoU) in 2022 to hold regular consultation for political, economic, cultural, people to people contact, climate change, agriculture, food security and environment protection cooperation.[6] Bangladesh expanded its ties with GCC countries and trade volume has increased over the decades. Bangladesh export to GCC market amounting to USD 1550.95 million and import from the GCC amounting to US 4628.13 million in 2023 with trade gap USD 3077.19 million. In 2023, global import of the GCC was USD 804.71 billion. Bangladesh could leverage this substantial market for export diversification.
Overseas Employment
GCC is the major market for Bangladesh in terms of remittance and overseas employment. Bangladesh exported about 73.78 percent manpower to the GCC compared to total overseas employment during 2004 to 2025 among which 34.49 percent manpower exported to Kingdom of Saudi Arabia (KSA) during the same regime. [7] Bangladesh’s remittance earnings increased in FY24, supported by favorable labor market conditions, wage growth in high-income destination countries, and rising demand for less-skilled migrants in the GCC countries, largely due to higher energy prices.[8] In FY24, the United Arab Emirates (UAE) became the leading source of remittances, contributing USD 4,634.24 million (19.38% of the total). The Kingdom of Saudi Arabia ranked second with USD 2,741.38 million (11.46%), followed by Kuwait at USD 1,496 million (6.26%), Qatar at USD 1,149.95 million (4.81%), Oman at USD 1,122.02 million (4.69%), and Bahrain at USD 639.17 million (2.67%). [9]
Bangladesh’s top export potential sectors to major GCC countries is highly concentrated in apparel, accounting for 89.2% (USD 1.81 billion) of the total, followed by footwear with 2.0% and miscellaneous manufactured products with 1.0%. Other emerging sectors with modest share include leather products (0.6%), fish and shellfish (0.5%), and processed food (0.5%), flax, hemp and natural fabric (0.7%), pharmaceutical components (0.3%), plastic and rubber (0.2%), machinery and electricity (0.2%), and spices (0.16%). This shows that while apparel overwhelmingly dominates Bangladesh’s GCC export potential, there are emerging opportunities in diversified sectors that could reduce overdependence on garments.
According to ITC Export potential by product (Product diversification), Bangladesh’s best options for export diversification in UAE and Saudi Arabia are cashew nuts (shelled) (080132), roots and tubers of manioc (071410), and fresh coconuts (0801XX), while in Kuwait, the best options are roots and tubers of manioc (071410), cashew nuts (shelled) (080132), and tunas (prepared/preserved) (160414). Additionally, mobile phones (8517XX) face the strongest demand potential in all three markets. Overall, the data highlights that Bangladesh’s export strength in the GCC is dominated by ready-made garments, particularly cotton apparel.
The global halal economy is estimated at approximately USD 7.7 trillion in 2025 and is projected to reach USD 10 trillion by 2030. [11] Additionally, around 10 million Bangladeshi expatriates residing in the Gulf region and Southeast Asia represent a significant potential consumer base for Bangladeshi halal products. By focusing on halal exports, Bangladesh can strategically leverage this growing market in the GCC region. Therefore, it is imperative for Bangladesh to tap into the global halal market and expand exports to Gulf countries.
References
1.World Bank. GDP (current US$)-South Asia. (2023) World Development Indicators. Retrieved from https://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=8S .
2.World Bank. The World Bank in Bangladesh. World Bank. Retrieved from https://www.worldbank.org/en/country/bangladesh/overview.
3.UNCTAD. (2025). Merchandise: Product concentration and diversification indices of exports and imports, annual (analytical). Available at https://unctadstat.unctad.org/datacentre/dataviewer/US.ConcentDiversIndices.
4.EPB.Country wise export date 2024-25. Retrieved from https://epb.gov.bd/site/view/epb_export_data/2024-2025//
5.McIntyre, A., Li, M. X., Wang, K., & Yun, H. (2018). Economic benefits of export diversification in small states (IMF Working Paper No. WP/18/86). International Monetary Fund.
6.BSS News. (November, 2022). Bangladesh, Gulf Cooperation Council Sign MoU for consultations. Available at https://www.bssnews.net/news/94789.
7.Bureau of Manpower, Employment and Training [BMET]. (2025). Overseas labour market in 2025. Bureau of Manpower, Employment and Training [BMET]. (2025).
8.Quarterly Report on Remittance Inflows in Bangladesh: April-June of FY24. Page no 3. Retrieved from https://www.bb.org.bd/pub/quaterly/remittance_earnings/remittance%20april-june%202024.pdf
9.Bangladesh Bank Annual Report-2023-2024. Page 292. Trends in country wise worker’s remittances. Available at https://www.bb.org.bd/pub/annual/anreport/ar2023-2024.pdf
10.Export Potential Map, ITC. September 2025. Retrieved from https://exportpotential.intracen.org/en/
11.Industry Insider. Bangladesh seeks bigger share of $10tn global halal market. (August, 2025) Available at https://industryinsiderbd.com/bangladesh-seeks-bigger-share-of-10tn-global-halal-market.
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