Celebrating the remarkable journey of over five decades in diplomatic camaraderie, the relationship between Bangladesh and Singapore has evolved significantly since its inception in February 1972. Commencing with the establishment of a Trade Commission in 1973, the bond strengthened with the inauguration of a full-fledged Diplomatic Mission in 1983, reflecting the enduring nature of their friendship. The recent elevation of Singapore’s “Consulate” in Dhaka to a “High Commission” in October 2023 is a testament to the deepening economic and cultural connections that have flourished between the two nations.
Singapore is a sunny, tropical island in Southeast Asia, off the southern tip of the Malay Peninsula. It is about 275 square miles, smaller than the State of Rhode Island, and inhabited by over five million people, of which the resident population comprises four major communities; Chinese, Malay, Indian, and Eurasian. Since its independence on 9 August 1965, the country has adopted a parliamentary democracy system. Currently, the government and the cabinet are led by Prime Minister Lee Hsien Loong while President Tharman Shanmugaratnam is the Head of State.
Ideally positioned in South-East Asia, where the rest of the region is just a hop, skip, and jump away, Singapore is a thriving metropolis offering a world-class infrastructure, a fully integrated island-wide transport network, a dynamic business environment, vibrant living spaces, and a rich culture largely influenced by the four major communities in Singapore with each offering different perspectives of life in Singapore in terms of culture, religion, food, language and history.
One of the reasons that Singapore proves to be attractive as a home is the ease of living, particularly in terms of residence, transportation, and governance system. Over the years, Singapore has made significant strides in many areas and has attracted an encouraging number of international accolades that recognize the city as vibrant and world-class.
So whether it’s the arts and cultural exchanges, the creation of cutting-edge innovation to enrich the lives of the communities at home or abroad, or the coming together of world-class minds to spark new business opportunities locally and internationally, Singapore is simply, the place where worlds meet.
Bilateral Trade Dynamics:
In the economic arena, Singapore stands as a crucial player in Bangladesh’s trade narrative, having emerged as its third-largest importing partner in the fiscal year 2020-21, with imports amounting to a substantial US$2.4 billion. Despite this, there remains untapped potential for expanding trade ties. Notably, Bangladesh’s imports, particularly in capital machinery and intermediate goods, represent only a fraction of its global requirements, opening avenues for enhanced collaboration. Similarly, while Bangladesh is a major global exporter of garment products, Singapore’s share in this sector is relatively modest, presenting a promising area for future growth and collaboration.
Singapore’s Investment in Bangladesh:
Singapore has emerged as a key investor in Bangladesh, channeling funds into critical sectors such as power, energy, transport, logistics, and ports. The latest statistics from Bangladesh Bank for FY2021-22 reveal Singapore as the fifth-largest investor in the country. An exemplary initiative is a collaboration between a Singapore-based company and a Dutch counterpart, culminating in a memorandum of understanding to establish a shipyard in the Payra Sea Port area, with an investment of US$1.58 billion. This ambitious project, if realized, could stand as one of the most substantial foreign direct investments in Bangladesh.
In a groundbreaking move to balance trade and investments, the Bangladesh government’s Capital Account Transaction (Overseas Equity Investment) Rules, enacted on January 16, 2022, permit Bangladeshi export-oriented businesses to invest a quarter of their total assets in offshore ventures. Sixteen companies have already gained approval, with several eyeing investments in Singapore, signaling the growing allure of Singapore as a strategic destination for Bangladeshi businesses.
Beyond the economic realm, the strength of the Bangladesh-Singapore relationship is evident in the extensive people-to-people connections. A substantial Bangladeshi diaspora and a semi-skilled workforce have found a second home in Singapore, contributing to the vibrant multicultural tapestry of the city-state. Pre-pandemic, approximately 50,000 Bangladeshis migrated to Singapore annually, making significant contributions to the country’s economy. The remittance inflow from this diaspora in 2020 amounted to a noteworthy US$624 million, surpassing the export value by threefold.
Moreover, Singapore has become a preferred medical destination for many Bangladeshi elites, showcasing the diverse facets of their interaction. The Chittagong-Singapore sea link, a critical international business gateway, reinforces the strategic importance of their geographical connectivity.
The diplomatic ties between Bangladesh and Singapore extend beyond economic collaboration. Several agreements, including a double taxation avoidance agreement, a bilateral investment agreement for the promotion and protection of investment, and an air service agreement, underscore the commitment to creating an environment conducive to trade and investment. The regular participation of both countries in the Shangri-La security dialogue emphasizes their shared dedication to regional security and stability.
The prospect of a Free Trade Agreement (FTA) looms large, representing a significant milestone that could elevate bilateral trade and investment to unprecedented levels. As Bangladesh prepares to graduate from the Least Developed Countries status in 2026, an FTA with Singapore would not only be timely but also mutually beneficial, ensuring sustainable market access in the Southeast and East Asian regions.
As Bangladesh embarks on a new phase of growth, the potential for a deeper engagement with Singapore becomes even more apparent. With a burgeoning market of 170 million people, Bangladesh presents an attractive opportunity for Singapore to solidify its presence in the region. The initiation of a full-fledged residential mission in Dhaka by Singapore would not only signify a deepened commitment but also serve as a catalyst for the next level of bilateral cooperation.
In conclusion, the diplomatic journey of Bangladesh and Singapore, spanning over five decades, has been characterized by resilience, cooperation, and mutual prosperity. The recent upgrade of Singapore’s representation in Dhaka symbolizes the maturation of their relationship, while the upcoming FTA holds the promise of unlocking unprecedented economic potential. As both nations reflect on their 50 years of diplomatic ties and look forward to the future, the prospects for an even stronger, more dynamic partnership between Bangladesh and Singapore appear not only promising but essential for navigating the evolving global landscape.
AKM Sayedad Hossain
Associate Editor, Diplomats World Publication