What is trade?
Trade, or international trade, means buying and selling goods and services between countries. A shirt made in a Gazipur factory and sold in Europe is a Bangladeshi export. Buying fuel, wheat, cotton or machinery from abroad is an import. Selling software services or serving foreign tourists counts as exports too.
Exports minus imports gives the trade balance. If exports are larger, there is a trade surplus; if imports are larger, a trade deficit. In Bangladesh, goods imports are usually larger than exports, so there is a trade deficit.
Say a factory makes a T-shirt and sells it abroad for 5 dollars. But much of the cotton or yarn, dye, buttons and machinery used to make it came from abroad, costing, say, 3 dollars. So about 2 dollars of value actually stays in the country, going to workers’ wages, power, transport and the owner’s profit. When looking at big export figures, it helps to remember this “import share”. The numbers are only an example.
Why it matters to an investor
- An effect on the taka: exports bring dollars in, imports send them out. A bigger trade deficit means more demand for dollars and pressure on the taka.
- An effect on prices: Bangladesh imports fuel, cooking oil, wheat and many raw materials. When their world prices rise, it feeds into inflation at home.
- An effect on company profits: export-oriented companies depend on demand from foreign buyers; import-dependent companies depend on world prices and the dollar rate.
- World news reaches home: a recession in a big buyer country, a tariff change or higher shipping costs affects Bangladesh’s exports and jobs.
Why countries trade
Not every country can make everything equally well. Economists say that if each country focuses on what it can make at a relatively lower cost (comparative advantage) and buys the rest, everyone’s total gain can be larger. Bangladesh’s large workforce has given it an edge in labour-intensive industries such as garments, while things like oil or advanced machinery are cheaper to buy from abroad.
What Bangladesh sells and buys
According to reports in The Financial Express and UNB, Bangladesh’s goods exports were about 48 billion dollars in FY2025-26, roughly the same as the year before. Around 80% of this was ready-made garments (RMG). By Bangladesh Bank’s figures, in the first 11 months (July–May) of that year imports were about 64 billion dollars and the trade deficit about 24 billion dollars.
The Export Promotion Bureau (EPB) and Bangladesh Bank count exports using different methods, so their figures can differ. These numbers change every year.
Source: UNB, 24 July 2026
See the numbers as a table
| Ready-made garments | Everything else | |
|---|---|---|
| Exports | 80 | 20 |
Is a trade deficit always a danger?
- No. The full picture is in the current account, which adds income such as remittances to trade in goods and services. In Bangladesh, large remittances cover much of the trade deficit; by the IMF’s figures the current account was roughly in balance (0.0% of GDP) in FY2024-25.
- What is imported matters too: factory machinery and raw materials can raise future output, which is different from importing only consumer goods.
- Heavy reliance on one product is a kind of concentration risk: if world demand in that sector falls, total export earnings suffer. The idea of diversification applies to countries too.
Worked example
- Say in one year a country exports 50 billion dollars of goods and imports 70 billion. The trade deficit is 20 billion dollars.
- A further 4 billion dollar deficit in services (such as shipping and travel abroad) and 5 billion dollars paid out as interest on foreign loans and profits sent home by foreign firms. The total gap is 29 billion dollars.
- Migrant workers send 30 billion dollars in remittances. Current account: 30 − 29 = 1 billion dollar surplus.
Result: even with a large goods trade deficit, remittances can keep the country’s overall external balance even. The numbers are only an example.
Common mistakes
- Treating a trade deficit as always a sign of crisis. You need to look at remittances, investment and what is being imported, all together.
- Taking the total export figure as all earned at home. Part of it goes straight back out on imported inputs.
- Ignoring world news as “someone else’s business”. A recession or tariff change in a big buyer country quickly reaches factories and companies here.
- Reading a trend into one month’s export or import figure. Monthly numbers swing a lot with seasons and shipment timing.
Exports bring dollars in, imports take them out; don’t read the trade deficit alone, look at the whole current account including remittances, because that is what points the way for the taka and prices.