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After considering recommendations of a joint task force of Chambers of Commerce from both countries, Federal Minister of State for Commerce & Industry Jairam Ramesh said India will consider lifting the ban on foreign direct investment (FDI) from Bangladesh. The Federation of Bangladesh Chambers of Commerce and Federation of India Chambers of Commerce and Industry (FICCI) have set up six task forces to recommend ways to improve bilateral relations.

Ramesh said that even as "we are seeking to push significant investments into Bangladesh," there should be adequate safeguards and must be on a case by case basis. India will not allow automatic FDI from Bangladesh as the source of funds is often not transparent and there is strong possibility that terrorism-tainted funds get laundered into legitimate business. He also pointed out that "there is no logic in seeking more Indian investments” into Bangladesh “while maintaining a ban on FDI into India from Bangladesh".

The Indian decision to block automatic FDI from Bangladesh had an unfortunate side-effect. The Tata Group had proposed a major investment plan but is spurned by Bangladesh by not providing reciprocal investment protection. The proposed plan would have not only created jobs but also helped Bangladesh reduce its trade deficit greatly.

Ramesh said that the Government will respond to the recommendations, including duty-free access to 16 items, with a minimum value addition of 20%, within a week. In any case the Indo-Bangla two-day Joint Working Group meeting is scheduled early July at Agartala. India is still considering recommendations from the various task forces and it is not clear whether the decisions are bound by political considerations. India does not appear to be overly enthusiastic to address Bangladesh’s concerns as that country has shown scant respect for Indian interests.

Bangladesh has refused to allow rail, road, or port access to India to reach its Northeastern states; the lack of access is seen as a major reason for the lack of development of those states. Hence, India is working with Myanmar to gain access to the Sittwe port and then transport goods via river to Meghalaya 200 kilometers away.

Meanwhile, Bangladesh opposition leader close to India Sheikh Hasina will arrive in India on a five-day visit starting Wednesday to receive the prestigious Mother Teresa Award in Calcutta.