Although the U.S. relationship with Bangladesh was initially troubled because of strong U.S. ties
with Pakistan, U.S.-Bangladesh friendship and support developed quickly following
Bangladesh’s independence from Pakistan in 1971.
U.S.-Bangladesh relations are excellent. These relations were boosted in March 2000 when
President Clinton visited Bangladesh, the first-ever visit by a sitting U.S. President, when
Secretary of State Colin Powell visited in June 2003, as well as when Secretary of Defense
Donald Rumsfeld visited in June 2004. A centerpiece of the bilateral relationship is a large U.S.
aid program, totaling about $163 million for 2009. U.S. economic and food aid programs, which
began as emergency relief following the 1971 war for independence, now concentrate on long-
term development. U.S. assistance objectives include stabilizing population growth, protecting
human health, encouraging broad-based economic growth, and building democracy. In total, the
United States has provided more than $5.5 billion in food and development assistance to
Bangladesh. Food aid under Titles I, II, and III of PL-480 (congressional "food-for-peace"
legislation) has been designed to help Bangladesh meet minimum food requirements, promote
food production, and moderate fluctuation in consumer prices. Other U.S. development
assistance emphasizes family planning and health, agricultural development, and rural
employment. The United States works with other donors and the Bangladesh Government to
Since 1986, with the exception of 1988-89, when an aircraft purchase made the trade balance
even, the U.S. trade balance with Bangladesh has been negative, due largely to growing imports
of ready-made garments. Jute carpet backing is the other major U.S. import from Bangladesh. A
bilateral investment treaty was signed in 1989.
Another trade related issue between the two countries involves the export processing zones
(EPZs). The government provides several tax, foreign exchange, customs and labor incentives to
investors in the EPZs. One such incentive provided in recent years was an exemption from
certain labor laws, which had the practical effect of prohibiting trade unions from the zones. The
U.S. Generalized System of Preferences (GSP) law requires the beneficiary country to satisfy
certain conditions relating to labor rights. On July 13, 2004, the government passed a bill
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