The first issue is the severe trade imbalance. The unabated influx of goods from India has many detrimental effects on the economy of Bangladesh. Bangladesh naturally wants to bring a more equitable status to the imbalance.

But the positive aspect of this lies in the fact that it is in India's interest as well to ensure that the economy of Bangladesh is not affected negatively by this severe imbalance. It is in India's interest as well to address this imbalance.

There are two basic reasons.

First, Bangladesh is within the top five trading partners of India. The formal and informal export to Bangladesh has been estimated to be to the tune of over 3 billion US dollars. This is indeed the hen that lays the golden egg. An economically weakened Bangladesh would have reduced buying power and hence would be forced to lower imports. Indian exporters would be the most affected.

The second reason is India cannot expect to achieve its role as a global power if its economic relationship with its neighbours are not based on mutual trust and a genuine desire for overall growth.

Recent, pre-SAARC Information Ministers' Con-ference offered freer access to the Indian economy. The same concept has been given by the Indian Foreign Minister in an article published on 13 February 2003 in one of the largest selling newspaper in India -- The Hindu.

The business community here is convinced that the Indian political leadership wants the economy of the region to develop. But what we really want to see is a roadmap with dates and objectives that both parties agree on which will rest the trade pattern in a win win scenario both for India and Bangladesh.

Now is the time when the Bangladesh business community must develop confidence in the pronouncements coming out of Delhi. It is true that discussions on reduction and elimination of tariffs have been launched but we would like to see these implemented and formulated in a way where immediate and tangible gains are seen in the trade scenario for Bangladesh.

Specially the economy of Bangladesh has many complementarities with the economy of the North East Indian states. The people of the North East states would derive immediate benefits from increased imports from Bangladesh. This can again be a win win situation.

With relevance to the North East what is the political reality of this region at this moment? The governments of both countries are facing pressures from two sides. One is a rising population. The other is rising expectations. With satellite dish and internet the expectations of the people are rising. The governments of both countries have no choice but to ensure that adequate economic opportunities are created for the population or the rising expectations will lead to frustration and unrest.

The political leadership of both countries must also be aware of the year 1998 when the political economy of the world opened a new chapter. It was the first time in modern history that the volume of worldwide intra-regional trade overtook inter-regional trade.

What is intra-regional trade? In the past two decades we have seen the emergence of regional trade blocs -- EU, NAFTA, ASEAN. These bloc members are the major players in the world market and they are increasing in size and strength every day. In the year 1998 the world received one more signal and the strongest signal yet that neighbours must unite, not fight.

The political leadership of both countries must than recognise the economic reality which is that unless the governments rethink their policies the region as a whole will become rapidly poorer and weaker as compared to other regions who are reaping the benefits of regional cooperation.

A meeting between the Indian Minister of State for Trade and Commerce Mr Satyabrata Mookherjee and the leaders of the Dhaka Chamber of Commerce and Industry (DCCI) was held on 30 December last. Mr Mookherjee is reported to have said that there was nothing apprehensive in the huge bilateral trade gap that exists between India and Bangladesh if it is viewed in the over all context. He also pointed out that Bangladesh, for example, enjoys a trade surplus with USA. In reality the two are not comparable.

The trade surplus India is having with Bangladesh is in many instances at the cost of development of the Bangladeshi economy. The back bone of the economy, the small and medium enterprises (SMEs) are specially affected -- many are being forced to close down. The Bangladesh trade surplus with USA on the other hand is not at the cost of the growth of the US economy.

In an earlier meeting an issue was also brought up by an Indian official that the trade surplus India enjoys over Bangladesh is often politicised. That a similar situation exists in the Bangladesh-China trade scenario.

To be fair this issue is to be viewed in the context of the fact that China does not have the same cultural, social, religious and heritage bonds that Bangladesh and India have.

The Chinese and Bangladeshi economies cannot develop and integrate in the manner that the Bangladeshi and Indian economies can.

And most importantly, India cannot take its place on the global stage if it does not have good economic relationship with its neighbours.

What is the way forward ? The Indian government should extend its hand of cooperation to Bangladesh and make the New Year -- 2004 -- the export to India year. The only solution is in greater economic integration with Bangladesh by giving priorities to a zero tariff access to the Indian market as it exists with Bhutan and Nepal by investment cooperation, reduction and elimination of non-tariff barriers and added cooperation in the spheres of culture and tourism, education and health care.

Finally we must recognise that if countries act alone they act in only self-interest, but when neighbours work together they choose the path of enlightened self-interest.

Sayeeful Islam is Director, DCCI.