Average nominal tariffs in Bangladesh are higher than other countries


Business Desk :
Bangladesh’s current average nominal tariffs, as high as 27%, are higher than average tariffs of the low-income countries (LICs), middle-income countries (MICs) and high-income countries (HICs), said economist Zaidi Sattar.

The Policy Research Institute of Bangladesh (PRI) chairman said it while presenting a paper in a seminar on “Tariff Protection and Export Diversification are Not Mutually Exclusive: The Bangladesh Phenomenon”.

The Bangladesh Institute of Development Studies (BIDS) organized the event at its conference room in the city on Wednesday.

BIDS Director General Binayak Sen chaired the seminar.

Sattar noted that tariffs are now the principal instrument of protection as well as incentive to import-substitute production.


Consumers bear the brunt of protection tax, as the protection policy leads to significant resource transfer from consumers to producers.

The government should balance the interests of consumers and producers, he also said.

The protection that is afforded through nominal and effective tariffs is a tax on consumers, who bear the ultimate burden of protection tax by paying higher than world prices (tariff-inclusive prices) for imported products and their domestic substitutes.

So, policymakers need to balance the support that they extend to producers by ameliorating the social costs of protection, he opined.

The PRI chairman also said the community as a whole stands to gain from protection, only when the objective of protection is met, that is domestic import-substitute producers become globally competitive in the shortest possible time — so that protection can be removed and domestic prices of import substitutes converge to international prices.