Customs Duty &

Border trade

Custom refers to the government

entrusted with enforcement of laws and
regulations to collect and protect
import revenues and to regulate and
document the flow of goods in and out
of the country.
They are imposed by the government
with the intention of raising the final
price of the product.

1.Basic Customs Duty.

2.Additional Customs Duty.
3.True Countervailing Duty.
4.Anti Dumping Duty.
5.Educational Fess.

Protecting Industry
Prohibiting Goods for achieving the
policy
Regulating export
Coordinating legal provisions

Self-dependency
Protection of new industries
BOP
Industrialization
Foreign exchange reserve
Employment opportunity
Economic development

Basically there are three modes of

imposing customs duty :

1.Specific Duties.
2.Advalorem Duties.
3.Compound Duties.

Custom wing of Bangladesh is

primarily responsible for collection of all
duties and taxes at the import stage.
Apart from collection of government
revenue it is also responsible for trade
facilitation, enforcement of government
regulations, protection of society and
environmental protection, preparation
of foreign trade statistics.

Capital Machinery
Raw materials of medicine
Poultry medicine
Defense stores
Chemicals of leather and leather
goods
Private power generation unit.
Textile raw materials
Solar power equipments

Import Restrictions.
Export Restrictions.
Health Restrictions.
Food Restrictions.

The following goods may be

imported into Bangladesh without
incurring customs duty : 200
cigarettes or 50 cigars or 225g of
tobacco; two bottles of alcoholic
beverages or one bottle if not
travelling for touristic purposes ( nonMuslims only); 250 ml of perfume;
gifts up to the value of Tk500.

Custom authorities may enforce

strict regulations concerning
temporary importation into or export
of items such as firearms, religious
materials, antiques, medications.
Business equipment and other items.
A current list of those countries with
serious problems in this regard can
be found here

Import substitution means

some rules discouraging import of
foreign goods which are already in
production in the home country. It is
one kind of protection policy. It is
meant to generate employment and
reduce foreign exchange demand and
stimulate innovation.

The notion of import

substitution was popularized in the 1950s
and 1960s as a strategy to promote
economic independence and development
in developing countries. Despite this, in
the 1970s, import substitution came into
the U.S. consciousness as a means to
promote national & regional development.

There are some specific objectives to implement Import

substitution policy :

1.
2.
3.
4.
5.
6.
7.
8.

To Protect the local industry and production.

To increase internal production.
To create employment opportunity.
To reduce the dependence of foreign currency.
To reduce the dependence on foreign luxury
imported goods.
To create competition among domestic industries.
To accelerate the growth of country economy.
To ensure the use of local raw materials.

1.
2.

3.
4.

Increase in domestic employment.

Resilience in the face of a global
economic shocks.
Less long-distance transportation
Reducing dependence on labor nonintensive industries.

1.
2.
3.

4.

Industries are inefficient & obsolete.

Cant exposed to internationally.
Increasing in unemployment
internationally.
World GDP decreases.

1.
2.
3.
4.
5.

Able to plug the leaks of capital.

Increase manufacturing sector in case
of foreign exchange.
Make a better economic performance.
Provide local communities path to
economic prosperity.
Increase understanding about the
foreign products.

Cross-border trade- defined as the flow

of goods and services across
international land borders within a
reach of up to thirty kilometers plays
an important role in supporting the
livelihood of border communities,
thereby, buttressing prosperity among
countries.

Significant in rural areas.

Effects are perceptible.
Strengthens local production.
Fosters services provisions.
Generates employment.
Lowers import prices of goods.
Gender dimension.
Transporting goods to the bazaar.

Geographical proximity.
Advantage of demand.
Rendering transportation.
Advantage of supply.
Availability of various goods and
services.
Bonefishes small traders.
Low cost.

Cross-border trade benefits traders

lives and incomes but also strengthens
local production, and fosters service
provision (such as storage facilities,
transportation, and ancillary services in
local bazaars). Such trade generates
income for people working in bazaars
as well as for activities associated with
bazaars and trade.

Vulnerable to government policies

Stimulating local economics
Obstacles relate to visa
Unduly strict restrictions
Encourage smuggling
Restrictive limits on exemptions
Discouragement of contraband trade.

At a meeting in Urumqi, China in

October 2006, minister of the Central
Asia Regional Economic Corporation
(CAREC) countries asked the World
Bank to conduct a study of cross-border
trade. By including cross-border trade
on its policy agenda, CAREC joined
organizations such as the Council of the
Europe and the European Union

Carried out by individuals.

Small quantities.
Agricultural products.
Trade goods on foot.
Depends on price differentials.
Consumers goods.

Pricing Differences
Limited Goods
Limited Quantities
Reduce export
Reduce import
Difficult to manage
Affect foreign currency rate
Threat to national defense